Every corner of the internet is trying to figure out what happens when Twitter gets Musk-ified.
The shortform social media platform has agreed to sell itself to the world’s richest man, Elon Musk, an avid user of the site (with more than 83 million followers) and one of its staunchest critics.
As late as last week, Twitter seemed poised to reject Musk’s $46.5 billion offering. That seemed to shift over the weekend. Twitter’s board reportedly met with Musk on Sunday after he secured financing from Morgan Stanley and other lenders, using a mix of debt and cash.
Importantly, the pending deal has revived concerns about how the billionaire’s free-speech absolutism could affect Twitter’s policy on misinformation and hate speech. That includes whether Musk would rescind the site’s ban on former president Donald Trump.
Grid breaks down key questions around the potential purchase.
Why is Musk doing this?
The billionaire has been open about the fact that his desire to purchase Twitter isn’t about the economics — it’s about influence.
“This is not a way to make money,” said Musk, speaking at TED 2022 on April 14. “It is just my strong intuitive sense is that having a public platform that is maximally trusted and broadly inclusive is extremely important to the future of civilization. I don’t care about the economics at all.”
Musk’s plan is to take the company private — giving him incredible power over Twitter because it will allow him to roll out products quickly, make decisions with less scrutiny and overall operate with less transparency than a publicly traded firm.
It could also benefit his other business interests, including Tesla and SpaceX.
“Musk has done very well using Twitter to help build the other brands he owns,” said Aron Solomon, chief legal analyst at Esquire Digital. “He thinks he can do both here — continue to use Twitter to support Tesla, SpaceX and the like as well as do something that by [Twitter founder and former CEO] Jack Dorsey’s own admission last week hasn’t been done, which is take Twitter to the next level as a business.”
That could signal a new phase of Musk’s life as a public figure, one in which he is less of a barrier-breaking entrepreneur and more of a wealthy man harnessing the power of media to extend his impact on society.
Even before he launched his bid for Twitter, Musk’s tweets often generated their own news cycles. Now, as he prepares to take control of the company, he’s solidifying his hold on a site that has helped him build his public persona and that wields outsized influence worldwide.
Why is Twitter doing this?
Twitter has historically punched above its weight in terms of influence, counting among its power users heads of government, journalists and activists. But it has never come close to reaching Facebook’s level of profitability, and its total valuation lags behind many of Silicon Valley’s other major players. Although Twitter launched in 2006, it didn’t record its first annual profit until 2018. The company’s recent internal power struggles have resulted in Dorsey leaving. Twitter’s board, and the company’s investors, may be counting on Musk to finally capitalize on the site’s influential audience. Musk has publicly mused about a number of changes to the platform, including making the algorithm that serves users content open source and adding an edit button.
Musk’s offer of $54.20 per share is below Twitter’s highest closing share price of the past year — $71.69, from last July. But Twitter’s acceptance of the offer suggests the company’s board doesn’t think there’s a reasonable expectation the share will trade that high again anytime soon. When Musk started buying Twitter stock in January, the company was trading at $36.82; it fell as low as $32.42 in early March.
The billionaire has a knack for pushing up the value of shares in companies and products that he touts, whether it be Twitter or Dogecoin. Twitter’s share price rose Monday on the news that a deal from Musk was being finalized.
The potentially imminent deal also illustrates how meme stocks, which Musk has been a fan of, and economic reality are becoming further muddled.
“Rather than looking at fundamentals, people are looking at personalities,” said Howard Fischer, a former senior trial counsel at the SEC and a partner at the law firm Moses & Singer. “That could work for a while, but it presents some serious systemic stability issues — ultimately, historically, companies that aren’t based on fundamentals tend to suffer falls. You can’t keep this going forever. And who is hurt?”
Is buying Twitter a good idea?
Despite Musk’s apparent enthusiasm, the free-speech maximalist may not be prepared for the challenges of moderating content across the world.
Musk has expressed his distaste for permanent Twitter bans, of the sort levied on Trump, and called for the company to err on the side of leaving up tweets in the name of free speech rather than taking down those that violate the site’s content policies. But implementing that freewheeling approach would require reckoning with the patchwork of different laws and cultural attitudes toward free speech around the world.
Twitter currently moderates certain content and blocks users based on various standards; last week, for example, the company said it would ban ads that misrepresent the science and reality of climate change. Those who have been banned from the site include high-profile QAnon conspiracy theorists as well as the former president.
Such policy decisions have sometimes put the company in conflict with governments as well as members of the public. Russia, for example, passed a law that took effect on Jan. 1 requiring social media sites with more than 500,000 daily Russian users, which includes Twitter and other large platforms, to have a legal entity or local subsidiary based in Russia. Critics see that as a way for the government to threaten companies and employees in the country. In India, the government has threatened to arrest Twitter employees in the past over unlocking critics’ accounts. And in Myanmar, it became apparent that social media helped fuel a genocide.
It’s still an open question whether Musk is ready to handle these situations, when he might prefer to just tweet boob jokes. At the recent TED 2022 conference, Musk said that people “should be able to speak freely within the bounds of the law” and that Twitter should adhere to laws of the countries in which it operates.
“Elon Musk is not the first influential person who has notions of free speech that quickly run into the reality that there isn’t a one-size-fits-all across the world,” said Ángel Díaz, a lecturer at the University of California, Los Angeles, School of Law who has written reports on content moderation and marginalized communities.
Will Musk let Trump back on Twitter? What effect could this have on access to misinformation?
One of the most consequential decisions Musk could make would be to let Trump back on Twitter — if he wants to return.
Twitter has spent more resources to moderate its users in recent years than have other social media companies. The company’s decision to ban Trump last year — on the grounds that the then-president had glorified violence in the wake of the 2020 election — angered Trump. It also drove some conservatives to less-regulated platforms like Telegram and Parler.
Social media experts say that Musk’s focus on preserving free speech over moderating potentially harmful posts could very well mean a return of controversial right-wing figures like Trump and Rep. Marjorie Taylor Greene (R-Ga.) to the platform.
“There are no safeguards in place that the Twitter of the past will be like the Twitter of the future,” said Ryan Calo, a law professor at the University of Washington. Musk, a self-declared “free speech absolutist,” has not been shy about calling for a shift in approach. “A lot of people are going to be super unhappy with West Coast high tech as the de facto arbiter of free speech,” Musk tweeted shortly after Twitter banned Trump.
The billionaire has doubled down on that rhetoric in recent weeks. “Free speech is essential to a functioning democracy,” Musk tweeted in March. “Do you believe Twitter rigorously adheres to this principle?” (More than 2 million people responded, and 70 percent answered no.)
On Monday, shortly before his purchase of Twitter was announced, Musk tweeted: “I hope that even my worst critics remain on Twitter, because that is what free speech means.”
“Musk has spoken out about the need for free speech on these platforms, and that indicates to a lot of us that he is likely to outright reverse decisions about who can use Twitter,” said Samuel Woolley, media professor at the University of Texas at Austin. “Other tech company leaders can, and do, run their platforms as if they’re monarchies.”
Twitter has banned a long list of accounts in recent years aside from Trump: Thousands of users linked to the Islamic State and other terrorist groups, right-wing stars like Alex Jones and Milo Yiannopoulos, and users who spread misinformation about covid-19. Last year, the company rooted out a series of fake accounts posing as anti-union Amazon warehouse workers. In 2016, it banned ’00s reality star Tila Tequila, who had (among other infractions) posted a photo of herself doing a Nazi salute.
While critics like Musk say that moderating content online squashes free speech, proponents of say it can play a valuable job in curbing misinformation, violence and hate speech online. University of Washington researchers conducted an analysis of tweets made during the 2020 election and found that “interventions” on Twitter — like labeling or removing false tweets, or reducing the reach of tweets that assert unproven information — can curb the spread of misinformation by more than 50 percent.
What about Trump’s social media app, Truth Social?
Trump and associates have been working to launch a media conglomerate that features a social media app, Truth Social. Shares in a special purpose acquisition company set up to buy the new company fell on Monday after news broke that Musk planned to purchase Twitter, a sign that investors see Trump’s nascent platform and Musk’s Twitter in potential competition.
While the former president regaining his most infamous platform would be a watershed moment in American politics, and not least the 2024 presidential election, it would also be an awkward fit with his own existing business plans.
An open question is whether Trump will decide to return to Twitter even if the company allows him back. On Monday, Trump reiterated that he plans to focus on his own social media service, telling Fox News: “I am not going on Twitter, I am going to stay on TRUTH. … The bottom line is, no, I am not going back to Twitter.”
Trump’s Truth Social app is run by the Trump Media & Technology Group, which is supposed to merge with Digital World Acquisition Corp. to become a publicly traded company. Digital World is an SPAC, set up as a vehicle for investors to merge with another company and take it public without going through a formal initial public offering process. In October, Digital World announced that it had found its target: Trump Media & Technology Group.
Neither company responded to a request for comment.
Truth Social has largely failed to catch on, and has been plagued by technical difficulties and sluggish user growth. Even Trump has posted only once on Truth Social, in February; meanwhile, his staff regularly releases his statements on Twitter.
Investors in Digital World Acquisition Corp. have been unhappy with the performance of their future business partner. The SPAC’s stock price has fallen by almost two-thirds since late February, from a high of more than $97 to around $34 Monday.
Digital World has a September deadline for its merger with Trump Media & Technology; it can extend that for another year, or dissolve and redistribute the money it has raised. But the company faces problems beyond any complications related to Musk’s Twitter purchase.
In December, Digital World disclosed that it had received a request from the Securities and Exchange Commission for “certain documents and communications between DWAC and TMTG.” It also said it had gotten a request from the financial industry self-regulator, the Financial Industry Regulatory Authority for “information … surrounding events (specifically, a review of trading) that preceded the public announcement of the October 20, 2021 Merger Agreement,” with Trump Media & Technology. While the exact nature of the investigation is unknown, companies like Digital World Acquisition Corp. are supposed to raise money from investors first and then find a company to acquire. It’s been reported that Trump and Digital World’s chief executive had met before the Digital World IPO.
Did the media learn its lesson on covering Trump’s tweets?
The prospect of Musk’s purchase of Twitter on Monday brought with it renewed debate over Trump’s role on the platform. One question now is how journalists would handle any return by Trump to Twitter.
Trump’s Twitter following grew alongside his political ascent. He had just under 3 million Twitter followers when he announced his presidential candidacy in 2015 and more than 88 million by the time his account was suspended in January 2021. Before he was banned from the site in January 2021, Trump had used his Twitter account to circulate anti-Muslim content, post tweets widely viewed as racist and spread misinformation about covid-19.
Many observers on Monday expressed fears that Trump’s return to Twitter would bring about a return of similar patterns of outrageous and offensive tweets — often followed by expressions of outrage and fact-checking by journalists and others that inadvertently amplified the original tweet.
Since the suspension of his Twitter account, Trump’s statements continue to circulate widely on Twitter through the account of Liz Harrington, a Trump spokesperson.
“It’s very likely that, should Musk take over Twitter, he will allow Trump access to the platform once again,” Celeste Headlee, a public radio host and author, wrote on Twitter on Monday. “This would inevitably influence political outcomes, but also spread misinformation.”
Despite concern over Trump’s possible return to the platform, some commentators say he will remain a force regardless of his presence on Twitter.
Even without the benefit of his Twitter account, Trump’s political endorsements have already begun to reshape Republican primary races in some states ahead of the 2022 midterm elections.
“The idea that Trump’s existence in the ‘public sphere’ is dependent on Twitter is absurd,” wrote Steve Schmidt, a political strategist who has worked on Republican campaigns. “He is a dominant and malicious figure in our society who has shown that he can break laws with impunity to such a degree that he remains the GOP front runner even after his coup attempt.”
Thanks to Lillian Barkley for copy editing this article.