Unless you’ve been living under a rock, you have heard that Elon Musk has finally completed his acquisition of Twitter. This move has triggered a large swath of society to go absolutely berserk. Personally, I am not an active user of Twitter, and it is not a significantly important platform to any of my businesses; so I’m generally ambivalent as to who runs the corporation, but when I see a large group of people collectively losing their minds, some interesting entertainment is sure to follow; so I start paying attention. A sizeable contingent of people apparently believe Twitter is essential to a functional democracy. Reportedly, Thomas Jefferson relied heavily on Twitter for social discourse when writing the Declaration of Independence. The general consensus inside the asylum is that Musk is destroying the platform, the company, democracy, and perhaps humanity, generally describing his actions since taking the helm as “chaos”. It is interesting to see this shift of opinion because just a few months ago, these same commentators widely considered him a visionary genius and savior of humanity. How quickly things change. So, has Elon really lost his mind? Was he a fool masquerading as a genius all along, a secret suddenly reveaedl by the complexity of running a social media platform? I suppose he can orchestrate firms that build reusable rockets, electric cars, and underground hyperloops but a social media firm is outside the scope of his abilities.
Musk is subject to the errors of being human; so he will certainly make mistakes, but it is hard for me to accept that he has suddenly shown himself to be an idiot. So, what is the explanation? I cant know for sure, but I would like to offer an alternate view of what is widely considered “chaos” at Twitter.
In order to analyze Musk’s actions, we need to first have a general idea of what he is trying to accomplish at Twitter. He claims to want Twitter to be a “public square” where free speech is protected but also doesn’t want a “free for all hellscape” as he called it. That may be the end goal for Twitter but it isn’t the only goal because he isn’t turning it into an open-source application; so he still acquired Twitter with the intention to have it function as a business. I have been involved with numerous tech firm acquisitions over the past 20 years, and although the details of each deal in unique, they all can be summarized by just a few categories:
1. Integration
This type of acquisition usually means the firm being acquired has a product or service that the acquiring firm wants to add into their existing catalog of offerings. In these cases, the goal is continuity and absorption. There is usually little redundancy in staff between the two firms except for general operational employees, and there is usually a long-term outlook and strategy for merging the processes and knowledge of the acquired firm into the acquiring one. The idea is to bring the new company in with as little disruption as possible. Incidentally, mergers also fall into this category except there is usually bi-directional integration between the acquirer and acquiree.
2. Brand or IP Acquisition Sometimes a firm simply wants to acquire a brand or intellectual property and isn’t interested in maintaining the operations of the business being acquired. These cases are straightforward, the integration is immediate and usually all the employees of the acquired firm are dismissed except for a select few with important knowledge to transfer.
3. Competitor Acquisition In these instances, a firm desires to acquire a competing firm to both eliminate a competitor and increase market share. These deals can either behave like long-term integrations if the intention is to keep the existing brands/operations or can be relatively quick absorptions if the competitor’s brand and operations are not essential to the acquiring firm.
4. Takeover, Revamp, or Rehabilitation In a takeover, the acquiring firm purchases the acquiree with the intention of modifying its operations. Usually, the firm being acquired is either not profitable or performing sub-optimally, and sometimes the firm is in liquidation or in financial trouble. In these cases, the idea is there is potential value in the firm being acquired but it will take significant work to realize it. This type of acquisition usually carries the most uncertainty and risk. Prior to and immediately following purchase, there is an evaluation period that is intended to develop a strategy and timeline on what steps need to be take n to rehab the business. Employees will be cut; expenses will be cut; products will be decommissioned, and operations will be modified. The longer this modification period takes, the more expensive it gets; so its best to get through the pain as quickly as possible.
Clearly the Twitter acquisition falls into the last category, and it appears Elon has put his evaluation and modification period in warp drive. Let’s look at his actions:
· Fires the board and executives This move makes complete sense and is common in takeovers. The whole idea is that current management is not underperforming; so they are usually the first to go.
· Fires some employees Again, this may be unpopular, but it is a very common action in all acquisition types. Redundancy and low-performers are eliminated along with those that are unsupportive of the new direction.
· Informs employees that there are cultural changes coming
In a widely criticized open letter to employees, he encouraged them to be more committed to the firm along with ending work-from-home. This caused some employees to publicly meltdown, but I simply believe this was a pretty smart move on Elon’s part to create an environment where those employees who potentially would be a problem in the future would self-terminate. This was an especially important move given the ideological bent of many employees who viewed the platform as a way to promote a certain agenda. He basically triggered people on purpose to shake out everyone and rebuild from who is left.
· Informs advertisers that changes are coming In an open letter to advertisers, Musk explains that be bought Twitter to “help humanity”, tries to reassure them that it wont turn into a crazy platform but wants users to be able to customize their experiences, explains the importance of relevant ads, and states his goal of making Twitter “the most respected advertising platform in the world”. It is completely logical to address those who actually monetize the platform to give them an idea of the future, nothing crazy here.
· Charges $8 per month for verification The infamous blue Twitter checkmark, surely that was an idiotic move right? Not necessarily. Although it had some unintended consequences resulting in a bunch of impersonation, it fits with Musk’s goal of diversifying Twitter’s revenue streams from advertising by offering some subscription services. Not only was he able to gauge who was willing to pay for verification, but also he was able to use it as a test to see how quickly his technical resources could roll out a new feature on the platform. Additionally, it provided a quick influx of revenue at the same time that many advertisers were suspending their campaigns.
· Taunts Trump Musk famously taunted Trump with a poll to see if he should come back to Twitter, a move that again triggered a large segment of the population. But think about it, doesn’t Elon know that Trump set up his own Twitter variant, and doesn’t he know Trump is highly unlikely to come back to Twitter? So what’s the point? I think this is another test. He could have used the analytics from that poll to gauge how the recent changes have affected the user base and participation rates on the platform. Such a polarizing poll could hav given him an idea about how the user base of Twitter is shifting after him taking the helm.
When viewing his actions in the context of the normal acquisition process of evaluation and modification, I don’t see that he has done anything blatantly unusual except implementing his changes exceptionally fast. If he hadn’t triggered his employees causing many of them to quit in protest, he could have spent months trying to build a platform that could have had numerous projects sabotaged from within. Now, the employees that are left either actively support him or need the job more than they care about their own agenda. These are people you can work with. Charging for verification pulled in some cash flow while simultaneously testing his productive output and user’s willingness to pay for subscription services. Using analytics from his polls and tweets allow him to watch changes in the user base to determine the profile of active Twitter users which data is not only important to him now but also in the future when he wants to attract advertisers and add more pay-to-play options to the platform.
So why is there a constant drumbeat of negativity around Musk’s actions as Twitter head? Recent developments shine some light on the answer to that question. Two events caught my interest in particular: 1. His developing feud with Apple, 2. The White House’s reaction to the takeover. Apparently, Apple has been threatening to remove Twitter from the App Store. While I’m sure their terms of service are written in such a way that they are fully within their rights to reject anyone they want, there really is no justification for delisting Twitter other than pure biased retaliation. This begs the question, why does Apple care so much? This week’s White House press conference offers clues. The press secretary was asked about the Twitter acquisition to which she replied they are monitoring the situation and reiterated their concern that social media platforms have the “responsibility” to not allow their applications to be a vehicle for “misinformation”. So the government believes Musk leading Twitter could lead to the dissemination of misinformation and Apple stands ready to pull the plug on app distribution anytime it deems the Twitter app to be “dangerous”. The problem with this situation is that misinformation is in the eye of the beholder. Whenever two people have a difference of opinion, one party thinks the other party’s misinformation. Christians and Muslims have very different views on the Bible. Christians believe the Bible is the word of God, while Muslims believe in the Koran. If a Baptist preacher and Islamic cleric both tweet about their differing beliefs, which one is spreading misinformation? Who decides? This is the problem with trying to limit the spread of “misinformation”; someone has to be the arbiter of the truth.
Suddenly it all becomes clear, why there is so much ado about Twitter. Right under our noses, over the past decade a coordinated ecosystem between tech giants like Apple, Google, Facebook, and the government has emerged with the “responsibility” of deciding what the “truth” is, and have collaborated in presenting the public with a common narrative. George Orwell’s Ministry of Truth (1984) has become reality and has been in operation for quite some time with Twitter as one of its pillars. Elon Musk’s acquisition jerked that pillar out of place, outside the control of the matrix, and its members are freaking out.
Cancel culture is nothing new. There have been attempts throughout history to silence those who stray from the narrative and spread “misinformation”. Examples include:
· Galileo published a paper in 1633 espousing the radical view that the earth revolves around the sun which resulted in having his writings burned by authorities and spending the rest of his life under house arrest. He was cancelled by the arbiters of “truth” at the time who’s accepted narrative was that the earth was the center of the universe. I supposed they thought he wasn’t “following the science”.
· The philosopher Socrates was executed for the charge of “corrupting the youth” with his criticism of the government and “refusing to recognize the gods recognized by the state”. His views were considered too outside the mainstream of thought at the time. After all, they the excuse of “protecting the children”.
· The Arabic physician Rhazes was arrested for teaching “western” ideas such as rational thinking and was subsequently beaten in the head with his own books until he was blind, and his writings were outlawed.
· Albert Einstein criticized Hitler’s rise to power and had his bank accounts and property seized in Germany along with having his scientific works being publicly burned in Berlin. The claimed he was spreading “propaganda”. Hitler must have been very concerned about “misinformation”.
If these examples make you nervous, they should. History is filled with examples of persecuted individuals who dared to speak against widely held beliefs. The watchdogs of “misinformation” (in their definition) feel morally justified silencing their critics and truly believe they are protecting society. But, human beings don’t need someone to decide for us what is misinformation. We do not need someone to protect our sensitive ears form hearing something we don’t agree with. The decision about what is and what isn’t misinformation is the responsibility of the hearer. Dangerous ideas today are regarded as common sense tomorrow. It isn’t simply freedom of speech; it is also freedom for individuals to be exposed to different ideas and decide for themselves what they believe.
Whether Twitter exists or not isn’t extremely important, and free speech can exist even if Twitter collapses, but the general meltdown over Elon’s takeover of the platform does reveal a lot about the coordinated effort to control information, and that is what is truly dangerous.
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