Elon Musk’s tumultuous romance with Twitter may finally be headed for the altar, with the world’s richest man now close tofor the social networking platform it first tried to buy in the spring for $44 billion.
Musk seems to have plenty of ideas to turn around the beleaguered company, but he has his work cut out for him. Twitter remains controversial, with conservatives accusing it of censorship while liberals say it turns a blind eye to abuse and harassment. Users of the service lament the widespread presence of bots on the platform. Perhaps most uncertain is Musk’s ability and willingness to lead Twitter, which faces major competitive and financial pressures.
“The easy part was buying Twitter, the hard part will be transforming it,” said Dan Ives, technology analyst at Wedbush. “It was a third-rate social media platform. Monetization was extremely difficult. I see a lot of challenges ahead. And then there’s the concern that it’s juggling too many balls at once.”
If the deal goes through, current CEO Parag Agrawal is likely to step down. He and Musk have clashed publicly, with the latter messaging his displeasure with the Twitter chief, as revealed in emails released last week. Twitter’s former security chief Peiter Zatko told the Senate last month that Agrawal ignored hugeleading Senator Chuck Grassley to call for the CEO’s impeachment.
As for who could lead Twitter, experts are tight-lipped, with one caveat: It can’t be Musk.
“He’s the worst guy for the CEO role,” said William Klepper, director of executive education at Columbia Business School. “He’s an inventor, he’s not a manager. He’s like a loose cannon, but he’s a genius.”
The ideal leader, Klepper said, would be someone who has led a startup to a mature stage and has experience building similar turnarounds at other companies, along with a healthy tolerance for chaos.
“Would you want to be in an organization in decline that has been sold to a new leader who has a track record of being unstable, but highly innovative?” he added. “This environment needs to retain as much good talent as it can and invite people who are open to change, and Musk should articulate his vision.”
Tweeting for users
Once Twitter goes private, it will be relieved of some of the pressure to deliver quarter-on-quarter profits to appease Wall Street. This is positive, as the platform has seen user interest since the 2019-2020 election cycle, according to eMarketer. The marketing intelligence firm predicts that Twitter’s user base will shrink slightly this year and continue to decline in the coming years.
But Musk’s involvement could keep the most loyal Tweeters. A poll by Ipsos in April showed heavy users were the most positive about Musk’s acquisition, with the majority believing it would improve the amount of “free speech” on the platform.
In particular, Musk has promised to bring Donald Trump back to the platform, a move that is sure to bring back many of the former president’s fans while prompting others to leave Twitter.
Create an “app for everything”
In a few years, Twitter under Musk could be much bigger and more capable. He previously said he wants the platform, which now has about 238 million regular users, to reach 1 billion users and expand aggressively overseas.
On Tuesday, Musk again suggested expanding the platform’s services, tweeting: “Buying Twitter is an accelerator to build X, the everything app.”
Musk has long touted the idea of a “super app. In a June town hall with Twitter employees, he spoke highly of WeChat — an app popular in China that’s used for everything from hailing a ride to buying groceries and chat with friends.
“You basically live on WeChat in China because it’s so easy to use and useful in everyday life, and I think if we can achieve that or even come close to Twitter, it would be a huge success,” he said.
In a presentation Musk sent in May, he proposed adding a payments platform to Twitter and adding a subscription feature, while moving to quintuple total revenue to $26 billion, according to the New York Times. He also predicted the platform would have 930 billion users by 2028, the Times reported.
For Musk, however, the first step in revitalizing Twitter would involve repairing the damage caused by his months-long public feud with the company.
In Ives’ view, Musk agreed to go ahead with the merger to avoid a possible loss in his legal battle to exit the deal, with the case set to begin later this month in Delaware Court. This suggests that Musk’s attitude could be the biggest obstacle to Twitter’s recovery
“The writing was on the wall,” Ives said. “He was going to lose in Delaware. He would have ended up in the same situation, having Twitter but with a lot more public embarrassment.”
Added Ives, “Now he has a home he didn’t want to have.”