Twitter (TWTR) is officially Elon Musk’s company. The Tesla (TSLA) CEO took over his favorite social network Thursday after months of back and forth that saw Musk try to buy the platform, then back out, and finally agree to buy it again.
Now he has to prove he won’t turn Twitter into an even greater wasteland of anger, hate speech, and misinformation than it already is. Musk told advertisers on Thursday he doesn’t want the site to become a "hellscape," and that he wants advertisers to stick around. But if he can’t deliver on that promise, the site could lose its advertisers, and its user base, and turn into another irrelevant app like MySpace.
“I think a lot of folks are saying ‘Look, if this place does become a hellhole, I'll leave. But I'm going to give it a chance to flourish,'” explained Eric Talley, a professor at Columbia Law School and expert on corporate law and governance.
But as one of Twitter’s most prolific posters, and trolls, he’ll need to stick to his word that he wants the platform to be "warm and welcoming” for everyone.
“Elon Musk is starting out as CEO with a large trust deficit,” Forrester research director Mike Proulx told Yahoo Finance. “He has work to do to repair the damage that's been done during a very public and dramatic acquisition process and across Twitter stakeholders. And by that I mean, Twitter's employees, its users, and the advertising community.”
The easy part is over
Musk spent the seven months trying to buy Twitter and then fighting to wiggle out of the deal. Now that he’s made the $44 billion deal official, Musk needs to find a way to make his new platform succeed.
“The day has finally come with Musk officially closing the Twitter deal last night,” Wedbush analyst Dan Ives wrote in an investor note last week. “As we have discussed, the easy part for Musk was buying Twitter. The difficult part and Everest-like uphill battle looking ahead will be fixing this troubled asset.”
Twitter has an outsized influence on our culture compared to some of its biggest competitors. With 237.8 million monetizable daily active users — the company’s measurement of users who see ads — Twitter is far smaller than Facebook parent Meta, which has 2.93 billion daily active users, and TikTok, which reported having 1 billion monthly active users in September 2021.
Despite its comparatively small size, Twitter regularly fuels major news stories because of the people who use it. That’s not always a good thing. Former President Trump was banned from the platform for using it to instigate the attack on the Capitol, and the artist formerly known as Kanye West was suspended for his recent antisemitic rant. A hero diver sued Musk after the CEO referred to the man as a "pedo guy" on Twitter.
But headlines don't translate into dollars. For years, investors have complained that Twitter isn’t monetized well enough, calling for the company to introduce subscription features and figure out ways to bring in more ad money. To turn the company around, Musk needs to leverage Twitter’s cultural significance, and to listen to the advice of workers and ad partners.
"Elon Musk [has] to listen to the Twitter community, to listen to Twitter employees and those employees that will be remaining there, to listen to advertisers. These are all important stakeholders that Musk is going to have to energize in order for the platform to be successful,” Pourlx said.
Musk is already making changes
Nobody knows for sure how Musk will transform Twitter. He’s gone from calling for all speech to be allowed on the site to saying that it should be moderated to some extent. On Friday, Musk announced that he is putting together a content moderation council made up of diverse viewpoints that will presumably be responsible for making decisions about user-generated content and accounts.
If he does allow the site to turn into a morass of hate speech and negativity, though, he could end up alienating Twitter’s existing user base.
Musk also needs to lay out a clear vision of what he wants to do with Twitter. That's something he could have done over the last few months if he hadn't been trying to get out of buying the site.
“He needs to be able to communicate that vision in ways that have both a sense of detail, a sense of strategy," Talley said, "and above all, have a sense of commitment by him.”
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