Musk "declares war" on Zuckerberg

The author | Gu Twenty

Edit the | Page

Musk has become the largest shareholder of Twitter, and for Zuckerberg, who is "addicted" to the metacosm, he may face a new round of competitive pressure.

On Monday morning, April 4, Eastern Time, Tesla CEO Musk became Twitter's largest shareholder with a 9.2% stake, far more than Twitter founder Jack Dorsey, according to a regulatory filing filed by Twitter with the U.S. Securities and Exchange Commission.

According to the details of the content, musk spent nearly 2 months in order to become the largest shareholder of Twitter. Since the end of January this year, it has increased its holdings of Twitter stock in an almost daily purchase, and finally bought nearly 73.5 million shares of Twitter stock when the transaction was completed on March 14.

It may be due to Musk's long-term wealth pioneer effect, which has made Musk the largest external shareholder of Twitter, and at the same time, it has also made Twitter rise by 27% in a single day, the largest intraday increase in nearly four years.

As another major social media platform in the United States along with Twitter, Facebook has not had a smooth time recently. On the one hand, subject to Apple's new privacy policy, the chief financial officer of its parent company Meta said that because Apple's latest privacy policy has caused direct damage to the platform's advertising effectiveness, Meta's advertising revenue in fiscal 2022 may lose more than $10 billion, equivalent to about 8% of its total revenue last year.

On the other hand, the competition from China's TikTok has also put founder Zuckerberg under pressure. On his first earnings call in 2022, he mentioned TikTok five times, admitting that TikTok was under increasing competitive pressure on Facebook, and even acknowledging that Facebook was losing younger users.

The latest financial report data shows that Meta's daily active users in the fourth quarter were 1.93 billion, unchanged from the previous quarter; 2.91 billion monthly active users were also the same as in the third quarter. Obviously, Meta's metacosm has not yet arrived, and the engine dominated by Facebook is facing growth stagnation.

Under the influence of two factors, Meta plunged nearly 27% during the previous February earnings report, setting a record for the largest single-day market value evaporation of the company's market value in the history of the US stock market, and has not yet recovered.

Not only that, for Zuckerberg, the metaverse he is betting on is also being evaluated by foreign media as the largest authoritarian "country" on the earth because of his series of operations. While people are looking forward to the liberal changes that Musk could bring about by becoming Twitter's largest shareholder, it is clear that Musk and Zuckerberg have come to the two ends of the power of tech companies.

01 Everyone is looking forward to Musk's change

Even the relevant public information does not show the purpose of Musk's large-scale purchase of Twitter, and whether there will be any plans to intervene in the operation of social media. However, for Musk to become the majority shareholder of Twitter, all sectors of american society are still full of expectations.

Cathy Wood, founder and CEO of Ark Investment Management LLC, told Bloomberg that Musk's new stake in Twitter could open the door to a management reshuffle at the social media company. Wood believes Musk is sending a "strong signal" to Twitter's current CEO, Parag Agrawal, that could prepare for another leadership change.

Parag, who has just replaced Twitter founder Jack Dorsey as the current CEO in November 2021, tweeted that Musk is exactly what we need and will bring tremendous value to our board.

Musk responded that he looked forward to working with Parag and Twitter's board of directors to make significant improvements to Twitter in the coming months. In the latest Twitter announcement, Musk will also become a member of Twitter's board of directors as a Class II director. At the same time, it is worth noting that according to the documents, Twitter and Musk reached a consensus on their shareholding ratio of up to 14.9%.

Previously, according to the common Interpretation of Wall Street people, a holding ratio of less than 10% for a company often means "passive control", that is, the shareholder does not seek to gain control of the company or influence who will run the company. But the latest 14.9% shareholding consensus has laid the groundwork for the possibility of follow-up.

Whether it is passive equity or active acquisition, for Musk to become the majority shareholder of Twitter, many US political lawmakers have issued articles expressing expectations.

Rep. Lance Gooden praised Musk, seeing the acquisition of Twitter as a warning of the social media giant's "power." He tweeted: "I'm glad to see that Musk is protecting free speech, but Congress must act to let other big tech companies know where they are." ”

Previously, large technology companies such as Twitter, Facebook, and YouTube banned his accounts on major social platforms before the end of Trump's term, after which Trump announced that he would sue these big technology companies for abuse of power. Therefore, whether or not Trump's Twitter account can be unblocked has become a vote for musk's change.

On Twitter, for example, Rep. Lauren Boebert said he wanted Twitter to restore President Trump's account. "Now that Musk is Twitter's largest shareholder, it's time to lift political censorship and bring Trump back," she said.

Monica Crowley, a former Treasury official, similarly said: "He should demand an end to political censorship, company-wide reforms, and the restoration of President Trump's account." ”

Musk also understands this, before becoming Twitter's majority shareholder, he had posted on Twitter: "Given that Twitter, as a de facto public municipal square, its failure to observe the principle of free speech fundamentally undermines democracy." ”

Fox News commented that the surge in Twitter's stock price after Musk became a major shareholder of Twitter proved to be a good buying point to some extent. Because it's hard to imagine Musk buying Twitter stock for investment, after all, he is already the richest man in the world.

However, from a business perspective, Musk's free speech tendencies are also causing concern among many advertisers. Brian Weizer, global president of GroupM's business intelligence business under advertising giant WPP Group, believes that any relaxation of content restrictions could be counterproductive to advertisers.

"Advertisers don't want their brands associated with promoting rebellion or hate and harm, they don't want to be associated with an online environment that can make users toxic."

However, when Musk, who represents the current spirit of Silicon Valley in the United States, crosses into social media, whether it will make Twitter speech more liberal, the change itself is something worth looking forward to. After all, for the current social environment in the United States, there are very few candidates who can challenge Zuckerberg's feudal kingdom.

02 Zuckerberg's feudal kingdom is under pressure

In 2010, when Facebook first overtook Yahoo and became the world's top three websites along with Microsoft and Google, Vanity Fair released its institutional power rankings, ranking Facebook first, calling Zuckerberg "our new Caesar."

This year, the biographical drama "Social Network", based on "The Unexpected Billionaire", was released, showing the history of Facebook to the world, making Zuckerberg usher in the beginning of the transformation from a juvenile genius to a popular star.

However, although it brought traffic to Zuckerberg, because it involved the black history of the early days of his fortune, the film was not welcomed by Zuckerberg.

The New York Times reported that year that Facebook always invited you to show more privacy and share more information. Its business model dictates it, but Zuckerberg doesn't share his fortune with others.

But thanks to the prevailing view at the time that the Internet would bring positive changes to the world, Zuckerberg was still elected as the person of the year in many media and magazines in the following years, even after much controversy.

In an environment friendly to the transformation of the Internet, Vinton Surf, one of the creators of the Internet, also wrote optimistically in the article "Open Internet": "The design of the Internet puts the power and function of the network on its edge and in the hands of the end user." At this time, the Internet as a reformer was full of imagination.

But no one expected that just a few years later, the Internet technology giants represented by Facebook would become another center of power. In 2021, when Facebook announced the change of name to Meta, Adrienne LaFrance, executive editor of Atlantic Monthly, summed up and reflected on this.

She sees Facebook as more of a "country" than a web publisher, social platform, company, or program. For years, Zuckerberg has tended to use governance language rather than corporate orders. Trying to issue money and establish the concept of online land, its 2.9 billion users also exist as "citizens" in his mouth.

Not only that, in the external business competition, Zuckerberg also likes to use politics to solve. According to an internal email exposed by the Washington Post on March 30, in the commercial competition with TikTok, a subsidiary of The Chinese company ByteDance, it has been smeared for four years through "rumors, dirty water and other ways".

Among them, TikTok's Chinese corporate background is the biggest killer of Zuckerberg's smear. In July 2020, Zuckerberg and the presidents of the three major tech giants Google, Apple and Amazon attended an antitrust hearing. When asked whether Chinese companies have stolen the technology of us technology companies, all three gave a negative answer, and only Zuckerberg said affirmatively: "I think the evidence on this matter is conclusive." "This incident has dealt A fatal blow to TikTok in the U.S. market.

Bad fortunes, ambitions of cyber authoritarian states, and politicization of business competition. Under some operations, the #Delete Facebook# that has been triggered in the early years has become more and more intense, and Zuckerberg, who was once again on the cover of Time magazine at the end of 2021, his face was "deleted Facebook? "The pop-up obscuration. The reason for the selection reads" as "to connect the world, regardless of user safety."

Long ago, Zuckerberg once talked to a friend about the trend of technological development, he said: "Obviously, everyone will stay online in the future, so inevitably there will be a huge online community to connect people." 」 Facebook is a product of the evolution of the times, and if we didn't do it back then, there would always be someone else doing it. ”

Little did he know that Facebook, founded in 2004, would be labeled "the world's worst and most destructive website" by The New Republic more than a decade later. As its creator, Zuckerberg was also named "Villain of the Year."

Time magazine even praised Musk in its character interviews with Musk of the Year, while not forgetting to satirize Zuckerberg: "Before Musk came, the United States stagnated, and nothing was produced except rules, restrictions, obstacles, and Facebook." ”

At that time, Musk and Zuckerberg did not have a direct business competition relationship, but from the moment on, when everyone expected Musk to change, it was obvious that the pressure came to Zuckerberg's side.

Resources:

Zuckerberg's Darkest Hour – 21st Century Business Herald

From genius to devil, who changed Zuckerberg – the River Of Three

The biggest authoritarian "state" on earth: Zuckerberg's Ambitions – The Atlantic