Musk’s $44bn Twitter gamble: ‘Chief twit’ or saviour?

musk2Nearly seven months and a protracted legal battle later, it appears that Elon Musk’s $44bn (£38.1bn) deal for Twitter has finally been sealed, with the world’s richest man confirming the move by tweeting “the bird is free” and changing his profile to “chief twit”.

The move has already triggered the departure of a number of senior executives, including CEO Parag Agrawal, chief financial officer Ned Segal, and top legal and policy executive Vijaya Gadde.

However, Musk has claimed he is not buying the firm “to make more money. I did it to try to help humanity, whom I love”.

Naturally there has been much speculation about the multi-billionaire’s plans for the site, and whether or not he will allow Donald Trump back on and create a platform for free speech. However, in an open letter to advertisers Musk said: “Twitter obviously cannot become a free-for-all hellscape, where anything can be said with no consequences!”

Instead, he has indicated he sees Twitter as a foundation for creating a “super app” that offers everything from money transfers to shopping and ride-hailing.

But he could have his work cut out. Twitter has already fallen way behind most of its social media rivals and is also struggling to engage its most active users who are vital to the business. These “heavy tweeters” account for less than 10% of monthly overall users but generate 90% of all tweets and half of global revenue.

Newspage co-founder Peter Vidlicka said: “The bird may have been freed but the focus now is on how it behaves, as a songbird or the social media equivalent of a raptor.

“Musk’s immediate firing of several of the senior management team is standard operating procedure in many regards but also proof positive that he has new ideas for the direction of one of the world’s leading social media platforms.

“All eyes are now on the potential return of Trump. That’s the ultimate litmus test for Twitter moving forward. Will Musk stand by his word and let Trump back onto the platform or cave to the demands of the corporate world?”

Vidlicka reckons that Twitter could now be heading for a pistols at dawn standoff with corporate advertisers, who will be monitoring events closely and assessing whether the new form it takes remains a viable marketing option.

He added: “Elon Musk describes himself as a free speech absolutist, so in the current socio-cultural climate, we can expect fireworks in the months ahead.

“To many, Musk’s acquisition of Twitter will be seen as a cultural stand, a reinforcement of free speech and a much-needed authentication of everyday people and their everyday views. To others, there is a fine line between free speech and hate speech and many are concerned that Twitter under Musk could become an even wilder West than it already is.

“The digital town square Musk wants Twitter to become is an avuncular metaphor that doesn’t necessarily convey the mayhem that often unfolds there. More often that not, it’s a digital town square, after kicking out time.”

Meanwhile, Marianna Boguslavsky, founder and digital strategist at Boguslavsky & Co, is also cautious about what the future holds. She said: “Marketers, along with any business owners, should be adopting a ‘wait and see’ approach before sinking any further ad spend or resources into Twitter.

“I think we’re in for some significant upheaval and change on this platform and marketers will be monitoring events closely.”

Whether the gamble pays off or not, Musk insists he “very much believes that advertising, when done right, can delight, entertain and inform you; it can show you a product or service or medical treatment that you never knew existed, but is right for you”.

But in what many have seen as a statement of intent, he concluded: “For this to be true, it is essential to show Twitter users advertising that is as relevant as possible to their needs. Low-relevancy ads are spam, but highly relevant ads are actually content!”

However, the $44bn question for Musk is, how can the company woo sceptical advertisers – who are already facing major cuts to their 2023 marketing budgets – and persuade them to switch back to Twitter?

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