Buckle up, because Twitter’s shotgun marriage with Elon Musk could produce business bliss or a messy breakup.
A day after Musk disclosed that he’s taken a 9.2% stake in the social media company, Twitter announced Tuesday that the Tesla CEO and world’s richest man will join its board. As part of the arrangement, Musk is limited to increasing his Twitter stake to 14.9% until he leaves the board in 2024—a signal that he’s not planning an imminent takeover.
Musk, a Twitter devotee who has criticized the platform’s free-speech policies and functionalities, hasn’t said much about his reasons for inserting himself in the company. In a lone tweet Tuesday, Musk stated that he’s looking forward to working with CEO Parag Agrawal and fellow board members to “make significant improvements to Twitter in the coming months.”
At its best, Musk could bring his unimpeachable business credentials to the lagging social media platform, helping the company to build fresher, nimbler, cutting-edge products that attract a larger user base.
As it stands, Twitter finds itself at a precarious moment, in need of strong entrepreneurial chops.
The company isn’t growing all that fast, leaving investors dubious about its prospects for meeting ambitious usage targets. Twitter recorded 217 million daily active users in the fourth quarter of 2021, a modest 13% year-over-year increase. By comparison, Facebook had 1.9 billion daily active users and TikTok claims more than 1 billion daily active users.
Twitter also feels stuck in the 2010s, as new features struggle to gain traction. While Agrawal has brought a renewed sense of ambition to Twitter following co-founder Jack Dorsey’s departure late last year, he’s yet to lay out a convincing vision for the company’s future.
In Musk, Agrawal could find a kindred spirit of sorts. Their personalities certainly differ—Musk can be brash and bawdy, while Agrawal keeps a low profile—but they’re bonded by a love for the technical and theoretical possibilities of their products. Some of their technological predilections also overlap, such as support for cryptocurrencies and algorithm transparency.
“(Musk is) both a passionate believer and intense critic of the service which is exactly what we need on @Twitter, and in the boardroom, to make us stronger in the long-term,” Agrawal tweeted Tuesday.
At its worst, however, Musk could treat Twitter as a vanity project, pushing the company in a direction that turns off users and sends investors running.
To date, Musk’s biggest complaints about Twitter largely center on its moderation policies, which have rankled the libertarian-minded entrepreneur.
In a tweet last month, Musk inferred that Twitter has undermined democracy with its policing, openly positing whether a new, competing platform is needed. Twitter has banned several prominent Republicans, including former president Donald Trump and U.S. Rep. Marjorie Taylor Greene, of Georgia, and occasionally labeled tweets as misleading.
If Musk’s primary push at Twitter revolves around censorship, the effort risks alienating the platform’s core base. A Pew Research Center analysis from 2020 estimated that those with left-leaning political affiliations made up roughly 70% of the most active Twitter users. In turn, a separate Pew poll found Democrats were more accepting of social media companies censoring certain content than Republicans, who vehemently opposed the practice.
Agrawal’s approach to free speech also appears to conflict with Musk, potentially setting the stage for an unwelcome clash. In an oft-cited November 2020 interview with MIT Technology Review, Agrawal said: “Our role is not to be bound by the First Amendment, but our role is to serve a healthy public conversation, and our moves are reflective of things that we believe lead to a healthier public conversation.”
Musk’s involvement with Twitter could go any number of directions. He could strategically rally support for a major corporate overhaul. He could get sidelined by supporters of Agrawal, who had strong board support at the time of his appointment. He could get distracted by other projects and leave with a whimper, similar to his departure from the Endeavor Holdings board last year.
On this, we can be sure: the journey won’t be boring.
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Ready for liftoff. Amazon’s satellite internet division confirmed plans Tuesday for 83 launches that will send hundreds of satellites into space over the next several years, The Wall Street Journal reported Tuesday. The launches would help the Amazon unit, known as Project Kuiper, catch up with rivals SpaceX and Blue Origin in the race to offer high-powered internet service that can blanket large areas. The Federal Communication Commission has authorized Amazon to deploy 3,236 broadband satellites, most of which would arrive in space through the 83 launches.
Teaming up on EVs. General Motors and Honda announced a partnership Tuesday to jointly build an electric vehicle platform that will serve as the foundation of millions of cars starting in 2027, Reuters reported. The two auto giants said they will share design, technology, and manufacturing strategies to produce lower-cost electric vehicles, including a small SUV with a projected price tag of less than $30,000. General Motors and Honda, which already collaborate on several projects, did not disclose terms of the agreement.
Always making things difficult. Tesla CEO Elon Musk likely will draw a federal securities investigation into his acquisition of a large stake in Twitter, the result of a late and potentially incorrect disclosure filing. CNBC reported Monday that Musk took 21 days to file a disclosure of his 9.2% stake in Twitter, exceeding the federal 10-day deadline for disclosing any acquisition of more than 5% of common shares in a company. The Verge also noted that Musk filed a Schedule 13G with the Securities and Exchange Commission, which is intended for purchases where the buyer doesn’t intend to influence company operations, instead of the more-appropriate Schedule 13D disclosure. The errors could lead to modest fines against Musk, who has battled with SEC regulators in the past.
Off the internet streets. German police said they have shut down the world’s largest Darknet marketplace, where thousands of drug traffickers, money launderers, and other criminals operated online, Bloomberg reported Tuesday. Law enforcement officials said the now-shuttered Russian-language Hydra Market processed about $1.3 billion in transactions in 2020. The server structure resided in Germany, though 17 million client accounts were spread across the globe.
FOOD FOR THOUGHT
Will the queen get an NFT? The British are making an about-face of sorts on crypto. Following months of heightened scrutiny placed on cryptocurrency outfits, the UK government announced a sweeping plan Monday for incubating crypto innovation in a more structured regulatory environment, Protocol reported. British officials said they envision the UK as a potential global hub for crypto-asset technology, even though prior regulatory actions and public warnings suggested the government viewed crypto as an overly risky investment. As proof of their newfound crypto bonafides, the UK announced plans to mint its own non-fungible token.
From the article:
The U.K. plan includes setting up a “financial market infrastructure sandbox” where crypto companies can experiment and innovate and the formation of a crypto engagement group that will work with the crypto industry and explore ways to make the U.K. tax system more competitive in relation to the crypto-asset market.
The announcement comes at a time when crypto appeared to be facing heightened regulatory pressure in the U.K., and illustrates the tensions at play where governments at once see an economic opportunity in encouraging the development of crypto as a high-growth financial sector and seek to contain risks of unregulated markets in digital assets.
IN CASE YOU MISSED IT
Crypto hater Jamie Dimon praises blockchain technology in his latest shareholder letter, by Taylor Locke
Can Elon Musk really make a Twitter edit button happen?, by Chris Morris
No ‘union’, ‘living wage’ or ‘restrooms’: A planned Amazon internal app could ban words in employee chats, by Ian Mount
A podcast host left his senior tech job to fight the dangers of hustle culture. Here’s his advice for success, by Mahnoor Khan
Vladimir Putin’s office is relying on technology he stifled for years to bypass the sanctions he brought on Russia, by Jonathan Vanian
Anonymous takes revenge on Putin’s brutal Ukraine invasion by leaking personal data of 120,000 Russian soldiers, by Carmela Chirinos
Snoop Dogg caps years of metaverse and NFT investment by dropping a music video set in his own ‘Snoopverse’, by Marco Quiroz-Gutierrez
BEFORE YOU GO
A huge winner. It pays to be in the video game business. As The Wall Street Journal reported Monday, Roblox co-founder and CEO David Baszucki received a mammoth compensation package last year valued at $233 million, making him one of the highest-paid executives of a public company. Most of the pay plan is restricted stock tied to performance milestones, but it’s still a massive haul for a company with $2.7 billion in 2021 revenue. The package dwarfs the $155 million in compensation awarded in 2020 to Activision Blizzard CEO Bobby Kotick, who took plenty of heat for the total. But don’t shed any tears for Kotick: he’s still in line for a $375 million payday if Microsoft’s planned acquisition of the gaming company goes through.
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