After recently criticizing the management of Twitter, and in particular, the platform’s move away from free and open speech in the app, billionaire Tesla owner Elon Musk has today purchased 73.5 million shares in the company, worth close to $3 billion, immediately making him the largest Twitter shareholder.
Musk now owns 9.2% of the company, and while his stake is ‘passive’ – i.e. Musk does not gain a board seat or voting rights – speculation now is that Musk could look to make a bigger move, and take more active control of the company in the near future.
What would that mean?
As noted, Musk has recently taken to Twitter to criticize the company’s moves to restrict free speech. Late last month, Musk shared this poll with his 80 million Twitter followers.
Free speech is essential to a functioning democracy.
Do you believe Twitter rigorously adheres to this principle?
— Elon Musk (@elonmusk) March 25, 2022
Musk also noted that ‘the consequences of this poll will be important’, without qualifying those remarks.
Following on from this, Musk questioned the role that Twitter is now playing in democracy, and raised the possibility of creating his own social network.
Musk has had a complicated relationship with Twitter over time, with the billionaire’s off-the-cuff tweets often landing him in hot water with the SEC and other regulatory authorities. Musk also has a history of sharing seemingly random memes and thoughts, which given his public status, has lead to confusion, and even concern at times for his mental state.
Case in point – Musk recently challenged Vladimir Putin to a physical fight for the fate of Ukraine.
Musk has also been a vocal critic of various government policies, including immigration reforms, COVID response measures and taxation proposals. And given his statements on Twitter’s moves to restrict certain speech, it’s possible that Musk would like to go further in such comments.
But would easing Twitter’s regulations be a good thing? Would it be more beneficial for society, as Musk stipulates, if Twitter were to allow more misinformation, and take a step back from looking to curb concerning movements and trends?
Twitter’s most notable action on this front came when it banned former US President Donald Trump from its platform for sharing comments that could incite violence.
Musk had thoughts on this as well:
So clearly, Musk has opinions on the way that perceived tech censorship is going – but surely a $3 billion investment is about more than simply enacting your own will on your favorite social media platform, and letting more controversial content filter through. Right?
Of course, $3 billion for Elon Musk is not a significant portion of his net worth, but even so, from a business perspective, you would assume that Musk has some angle here, a potential pathway to re-igniting Twitter’s growth and maximizing that investment.
Twitter’s already under pressure on this front after investors from Elliott Management Group bought up Twitter shares in 2020 in order to force Twitter management to up its game, and improve revenue performance at the company. That likely led to Jack Dorsey’s decision to step down late last year, while Twitter is also still being held to its ambitious revenue and user growth targets implemented as part of the Elliott push.
Maybe, Musk sees potential beyond this, and a means to help stimulate Twitter growth even further, and make it an even more significant part of the media landscape.
Many have envisioned the same, with Twitter, at least to some, failing to capitalize on its opportunities – while by comparison, Meta has continued to grow and expand well beyond Twitter’s pace.
Twitter and Facebook were once on similar pace. Maybe there’s a way to bring that back into view, and build Twitter into something even bigger, and more influential, within our broader communicative process.
Or maybe Musk will simply look to boost Twitter’s share price through his involvement and interest, before selling out for a profit. Twitter shares rose more than 28% after Musk’s stake was revealed, and maybe that’s the end game here, another troll from Musk to make even more money.
That seems less likely, but with Elon Musk, no one really knows for sure.
But what do know is that things are set to become a lot more interesting in Twitter’s board room over the coming months. Watch this space.