But Twitter tells Musk that he’s buying it whether he wants to or not.
“‘Twitter is likely to ask the court for two things in its litigation against Musk,’ said Brian Quinn, a law professor at Boston College. ‘Twitter is expected to seek a ruling that it has not violated its contract with Musk, and it will likely seek a judicial order requiring Musk to complete the acquisition.'”
I believe that Musk is probably correct when he says that Twitter has far more bots and false accounts than they have always claimed. When I had a Twitter account, I knew that many of my followers were bogus. The counterfeits were kind of obvious, because my account would muddle along for weeks with a certain number of followers, more or less unchanged, then one day the number would double for no apparent reason. My account may have been unusual, and I’m not claiming that Twitter’s overall numbers are like that, but I suppose this had to have happened to many accounts, not just mine. I assume the holders of those accounts just accepted it, as I did, because the number of followers is a matter of pride. Who’s going to write to Twitter to complain about having too many followers?
Twitter is an unusual business phenomenon. It is not especially large or profitable, but it exercises a powerful impact on the public, in both discourse and action, in the USA and elsewhere. That impact is far disproportionate to its financial success. Twitter’s annual revenues are only about $5 billion – about the same size as Harley Davidson, DoorDash or Abercrombie and Fitch. But DoorDash doesn’t have the power to get Presidents elected, or foment revolutions. Moreover, Twitter’s revenues are minimal compared to those of the other big internet powerhouses and it has only a tiny fraction of Facebook’s user numbers. It seems that Twitter could be much more if the company could find (1) the route to better user numbers, and/or (2) the right business model. Elon Musk is obviously no dummy. He can see that. But he’s not happy with what he’s seeing, or not seeing, so far in Twitter’s data. Twitter claims that the number of spam accounts and bots is now “well under” 5% of its users. Musk seems skeptical, to say the least.
Or maybe he just got buyer’s remorse and is using the data as his pretext, or just as a negotiation ploy. That is also possible. As of this moment, he is stuck with a bid of $54 a share for a company trading at $37. (It was trading at about $52 in late April). He can’t be that thrilled with the situation.
Bloomberg did a thorough (and surprisingly funny) analysis of the issue.
Uncle Scoopy, you said “But DoorDash doesn’t have the power to get Presidents elected, or foment revolutions.” I am not sure that was a good idea. Please let us know if you get a message from them saying “Challenge accepted!”
They have mentioned that I should think about hiring a food taster.
Wow. Who would have ever thought the conservative morons in this country could be taken in yet again by a laughably transparent right-wing huckster like Musk? The typical room temperature IQ + constant feelings of victimization of conservatives in the US make them the easiest marks of all for the likes of Trump and Musk, as they’ve shown yet again. Conservatives and “libertarians” are such a bunch of suckers.
Musk is a pathological liar who almost never delivers. He’s going to be writing Twitter a check one way or another. I just hope it’s a huge one.
Uh ok. Religions have definitely been replaced with a whole new breed today. I have lost faith that the majority of people will ever have any idea what is true or not anymore. Time to let the robots take over. Maybe they’ll do a better job.
If you don’t see the delicious irony in some pisspants blowhard like Musk blowing $40B all just to “own the libs” that says more about your partisanship than anyone else, friend. But go ahead and keep telling yourself that you’re different and above it all.
He never had the money to buy it in the first place. “Genius”
The real winners here though are us. No twattering from Musk, or Trump back on there covfefe-ing the place up.
I think he enjoyed basking in the (even more) celebrity for a few weeks while conservatives somehow embraced him for the promise of free speech on Twitter; maybe even reinstating Trump’s account. Now he is looking, at best, at a substantial penalty for breaking the contract.
I think he has a shot.
The userbase is the product, as you suggest.
If he can show they’re playing fast and loose with how many are real, or even that they don’t have a handle on how easy it is to generate fake users? That means the product is, to a great extent, fake or easily faked. Can’t hold him to buying a fake product.
Hell of a time to start in on your due diligence there, genius.
Exactly. The thing that hasn’t been mentioned is that Musk waived due diligence. Musk may not be a dummy, but his ego is still several orders of magnitude larger than his intelligence.
Yes…waiving due diligence should sink him in court…especially since he expressed concerns about bots before waiving due diligence.
Most legal experts are saying he will lose in court, but so far investors are not willing to gamble on that. If people really believed that to be true, people would be rushing to buy Twitter stock at 37, knowing that Musk will soon be obligated to buy those shares at 54. That is a large, rapid return on investment. But people are not standing in line to do that.
Also, I’m not at all convinced that Musk is wrong about Twitter failing to provide data in good faith. My gut tells me that it is in their interest to hide as much as possible, an opinion formed because I share Musk’s incredulity about their claim of “well under 5%.” But that is just my speculation. Twitter may be acting with total transparency for all I know.
At this point, either the two parties lawyer up for a protracted and acrimonious court battle (where the lawyers are the only winners), or they sit down and try to work it out, perhaps agreeing to an impartial arbitrator to evaluate their existing claims and counter claims. Good sense suggests the latter, but big egos may steer towards the former.
He’s stupid because he’s not a diehard Democrat? Is that how these opinions should be based? His success suggests otherwise. I believe the 2 large political parties in this country are mostly corrupt. Does that mean all their voters are morons? I’d love to see more discussion on actual issues in this country, but mostly I just find people calling the other party evil. Most issues get ignored, and most everything ends up being a waste of time.
No: He’s stupid because he waived due diligence on a $40B deal on an asset where the value and underlying fundamentals have ALWAYS been very debatable. Most of us would do more research before buying a lawnmower. You can chalk part of it up to ego or whatever, but it also contains a healthy dose of stupidity.
Now, the people who idolize Musk (for any reason)? They’re the stupid ones.
I don’t see where anyone said he’s stupid because he’s not a Democrat.
However there are plenty of counterexamples to your contention that “rich = smart”.
He signed the merger agreement after waiving due diligence.
There’s not a provision in contract law for “my big mouth got way out in front of my brain.” I know many idolize him, but this is one of the stupidest blunders in business history that was 100% driven by Musk’s ego.
Sorry Dark, but no. When Musk was bragging about buying Twitter he was saying he was going to stop all the floods of spam and fake accounts…so now he can’t act surprised that there is spam and fake accounts.
“Oh, ah do declay-ya – ah am shocked that theya ah bots in Twitta. Who evah could have dreamed? Oh, how ah swoon, Colonel Beauregard. Please, ah requiah mah faintin’ divan.”
(Read with your best Lindsey Graham impression)