It seemed like the deal was pretty much final, but a new argument between Twitter and Elon Musk is putting things on hold.
Late last month, we reported on Elon Musk buying Twitter for $44 billion. The move had a fair bit of buildup where Musk was openly musing about buying the whole platform. Of course, it was hard to really tell if the deal was actually serious or not. That speculation seemed to go from rambling musings to a serious bid.
For many, this represents a problem. Musk’s plans were to take the whole company private, pulling it from the stock market. In so doing, he would be seemingly free to run the whole platform as he sees fit. Given how much he is helping to fuel right wing extremism in Western democracies (i.e. supporting the “freedom convoy” occupation), many openly worried that he would turn Twitter into an even bigger cesspool then it already is. Confirmation came when Musk said that he would “unlock” the potential of “free speech” on the platform as well as his comments about how he didn’t necessarily agree with the banning of impeached president, Donald Trump after the January 6th terrorist attack Trump helped orchestrate.
As news spread that the deal might be all but over and that formalities were all that is left, users began seeking alternatives. The top two alternatives for a number of users seemed to be Mastodon and Countersocial. Right wing extremists were also actively harassing those who were contemplating leaving, seemingly as part of their bid to “own the libs” as well.
Given the history of right wing echo chambers failing, it seemed as though that history was pretty much set to repeat itself – only this time, it was going to bring down one of the social media titans, Twitter, this time. Already, Musk was openly saying that he would reinstate Trump’s account just to drive that image home of what is in store for Twitters future.
Now, we are learning that the seemingly all but final deal is becoming slightly less “final”. A disagreement between Musk and Twitter has now put the whole deal on hold. This is combined with the major drop in share prices since Musk said that he would buy Twitter in the first place. From CNET:
Elon Musk’s $44 billion deal to buy Twitter is “temporarily on hold, the tech entrepreneur tweeted early Friday, alongside a link to a Reuters article about spam accounts.
In another tweet two hours later, Musk confirmed that he’s “still committed to the acquisition.” In the intervening period, Twitter share prices took a significant hit, tumbling over 20% in premarket trading. When markets closed Friday, shares were down nearly 10% to around $40.72, a steep discount from the $54.20 per share acquisition price.
The Reuters article reported that Twitter had said in a filing that false or spam accounts represented fewer than 5% of its monetizable daily active users during the first quarter of 2022.
In Musk’s original tweet early Friday morning, he said the deal was on pause “pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users.” When Twitter released the figure as part of its quarterly results in late April, it acknowledged the number was an estimation and the actual number of fake accounts “could be higher.”
In a third tweet, later Friday, Musk said, “To find out, my team will do a random sample of 100 followers of @twitter. I invite others to repeat the same process and see what they discover.” In a follow-up, he said, “Any sensible random sampling process is fine. If many people independently get similar results for % of fake/spam/duplicate accounts, that will be telling.”
It’s hard to argue that the rollercoaster of developments didn’t have much of an impact on the value of Twitter in the stock market. This latest development seems to be adding a whole lot more unexpected drama to an already dramatic news story. Whether this is just a bump in the road to the acquisition or if it’s the beginning signs that the deal is forming cracks is anyone’s guess at this stage. At the very least, we know that the unpredictable nature of this acquisition just got a whole lot more unpredictable.
Drew Wilson on Twitter: @icecube85 and Facebook.
