If the billionaire could buy the company, he wants to cut Twitter's rules on speech, but experts say Musk may lack social media expertise.
Billionaire Elon Musk is known to have made a fortune from technology, but some media outlets say he's never run a company like Twitter.
Musk, the CEO of Tesla and SpaceX, spoke for the first time on Thursday about his proposal to buy the social media company for $40 billion, and he gave little to no plans or specifics about the matter, though he usually swings wildly on topics such as electric cars and rocket science.
At the TED2022 conference, Musk spoke in general terms about allowing more content on the platform to be censored in the name of free speech — a change that could allow more hate speech and harassment to run rampant — but didn't address core business issues, such as user growth or advertising revenue. Experts warn that if Musk succeeds in acquiring the company, his vision for the platform could lead to significant hurdles in the future.
How Musk leads Twitter
Siva Vaidhyanathan, director of the Center for Media and Citizenship at the University of Virginia, said: Musk's lack of experience in advertising and social media has caused some analysts to be very concerned, he does not seem to have a complicated concept of what it means to be in a global media business, and he has never been in this business, and the business has nothing to do with media or communications.
Musk has built a loyal fan base on Twitter, and his account is one of the most talked about, with more than 82 million followers, second only to singer Lady Gaga and ahead of Indian Prime Minister Narendra Modi.
But that doesn't mean he knows exactly how to raise advertising revenue or attract newcomers to Twitter, and the lack of experience could be a downside for him as he tries to convince Twitter's shareholders and directors to accept his offer. Tesla and SpaceX, as well as companies like Musk's early PayPal, didn't have significantly lucrative businesses in advertising sales. Tesla doesn't even spend much on advertising.
Yishan Wong, former CEO of Reddit, said in a tweet: "I think if Musk takes over Twitter, he's going to go into a painful world, but he doesn't know." ”
Musk could scare advertisers
As Twitter's board of directors unanimously adopted poison pill defenses, Musk's chances of acquisition became increasingly slim, allowing shareholders to buy more shares at a discounted price, which could force Musk to pay a higher price to buy the company.
Still, if Musk can afford it, the avenues to buy Twitter are still open, and he has expressed a keen interest. At the meeting on the 14th, Musk said he would rather abandon some of the content that Twitter is now removing because it says it violates its terms of service. "If it's a gray area, I would say let that tweet exist," he said.
But that's not necessarily the idea of large enterprise advertisers, who in recent years have been a less secretive force pushing social media apps to clean up user-generated content.
In 2020, more than 200 companies participated in the boycott of Facebook, suspending ad spending and citing fears of hate speech and misinformation. Vaidhyanathan said: "No advertiser wants to put their message on the same timeline as anti-Semitism or violence again women. That's just a bad thing," Vaidhyanathan said.
As a result, the advertising industry is wary of Musk's proposal to relax Twitter's speech rules, which mike Zaneis, co-founder of the Brand Safety Institute, is a nonprofit digital advertisers organization that focuses on objectionable material online.
Over the past few days, this topic has undoubtedly been a top concern for marketers," Zaneis said.
"Nobody wants to go back to the Wild West," he said, referring to an era when forums and social media platforms had little content moderation. "It's painful. It is harmful to brands. It is harmful to citizens. We've made incredible progress and I think the reversal would be unfortunate. Musk seems to be well aware of the impact and has criticized it. Musk said in a tweet this month: "If Twitter survives on advertising fees, the company's power to make policies will be greatly enhanced." The tweet was later deleted.
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