Elon Musk attempted to soothe leery Twitter advertisers Thursday, a day before a deadline to close out on his $44 billion acquisition of the social media platform, saying that he is buying the platform to “help humanity” and doesn’t want it to become a “free-for-all hellscape.”
The message reflects concerns among advertisers — Twitter’s chief source of revenue — that Musk’s plans to promote free speech by cutting back on moderating content will open the floodgates to more online toxicity and drive away users.
“The reason I acquired Twitter is because it is important to the future of civilization to have a common digital town square, where a wide range of beliefs can be debated in a healthy manner, without resorting to violence,” Musk wrote in an uncharacteristically long message for the Tesla CEO, who typically projects his thoughts in one-line tweets.
He continued: “There is currently great danger that social media will splinter into far right wing and far left wing echo chambers that generate more hate and divide our society.”
Musk has previously expressed distaste for advertising and Twitter’s dependence on it, suggesting more emphasis on other business models such as paid subscriptions that won’t allow big corporations to “dictate policy” on how social media operates. But on Thursday, he assured advertisers he wants Twitter to be “the most respected advertising platform in the world.”
The note is a shift from Musk’s position that Twitter is unfairly infringing on free speech rights by blocking misinformation or graphic content, said Pinar Yildirim, associate professor of marketing at the University of Pennsylvania’s Wharton School.
But it’s also a realization that having no content moderation is bad for business, putting Twitter at risk of losing advertisers and subscribers, she said. “You do not want a place where consumers just simply are bombarded with things they do not want to hear about, and the platform takes no responsibility,” Yildirim said.
Musk said Twitter should be “warm and welcoming to all” and enable users to choose the experience they want to have.
“I didn’t do it to make money,” he said of the pending acquisition. “I did it to try to help humanity, whom I love. And I do so with humility, recognizing that failure in pursuing this goal, despite our best efforts, is a very real possibility.”
Friday’s deadline to close the deal was ordered by the Delaware Chancery Court in early October. It is the latest step in an epic battle during which Musk signed an April deal to acquire Twitter, then tried to back out of it, leading Twitter to sue the Tesla CEO to force him to conclude the acquisition. If the two sides don’t meet the Friday deadline, the next step could be a November trial that could lead to a judge forcing Musk to complete the deal.
But Musk has been signaling that the deal is going through. He strolled into the company’s San Francisco headquarters Wednesday carrying a porcelain sink, changed his Twitter profile to “Chief Twit,” and tweeted “Entering Twitter HQ – let that sink in!”
And overnight the New York Stock Exchange notified investors that it will suspend trading in shares of Twitter before the opening bell Friday in anticipation of the company going private under Musk.
Musk is expected to speak to employees directly Friday if the deal is finalized, according to an internal memo cited in several media outlets. Despite internal confusion and low morale tied to fears of layoffs or a dismantling of the company’s culture and operations, Twitter leaders this week have at least outwardly welcomed Musk’s arrival and messaging.
Top sales executive Sarah Personette, the company’s chief customer officer, said she had a “great discussion” with Musk on Wednesday and appeared to endorse his Thursday message to advertisers.
“Our continued commitment to brand safety for advertisers remains unchanged,” Personette tweeted Thursday. “Looking forward to the future!”
Musk’s apparent enthusiasm about visiting Twitter headquarters this week stood in sharp contrast to one of his earlier suggestions that the building should be turned into a “homeless shelter” because, he said, so few employees actually worked there.
The Washington Post reported last week that Musk told prospective investors that he plans to cut three quarters of Twitter’s 7,500 workers when he becomes owner of the company. The newspaper cited documents and unnamed sources familiar with the deliberation.
One of Musk’s biggest obstacles to closing the deal was keeping in place the financing pledged roughly six months ago.
A group of banks, including Morgan Stanley and Bank of America, signed on earlier this year to loan $12.5 billion of the money Musk needed to buy Twitter and take it private. Solid contracts with Musk bound the banks to the financing, although changes in the economy and debt markets since April have likely made the terms less attractive. Musk even said his investment group would be buying Twitter for more than it’s worth.
Less clear is what’s happening with the billions of dollars pledged to Musk by investors who would get ownership stakes in Twitter. Musk’s original slate of equity partners included an array of partners ranging from the billionaire’s tech world friends with like-minded ideas about Twitter’s future, such as Oracle co-founder Larry Ellison, to funds controlled by Middle Eastern royalty.
The more equity investors kick in for the deal, the less Musk has to pay on his own. Most of his wealth is tied up in shares of Tesla, the electric car company that he runs. Since April, he has sold more than $15 billion worth of Tesla stock, presumably to pay his share. More sales could be coming.
Musk, 51, has shared few concrete details about his plans for the social media platform. While he’s touted free speech and derided spam bots since agreeing to buy the company in April, what he actually wants to do about either remains a mystery.
Technology analysts have speculated that Musk wants to use Twitter to help create an “everything app” similar to China’s WeChat service, which allows users to do video chats, message, stream video, scan bar codes and make payments. Musk told advertisers Thursday that much of the speculation about his plans is wrong.
Musk’s flirtation with buying Twitter appeared to begin in late March. That’s when Twitter said he contacted members of its board — including co-founder Jack Dorsey — and told them he was buying up shares and was interested in either joining the board, taking Twitter private or starting a competitor.
Then, on April 4, he revealed in a regulatory filing that he had become the company’s largest shareholder after acquiring a 9% stake worth about $3 billion.
At first, Twitter offered Musk a seat on its board. But six days later, CEO Parag Agrawal tweeted that Musk would not be joining the board after all. His bid to buy the company quickly followed.
In July, Musk abruptly reversed course, announcing that he was abandoning his bid to buy Twitter. His stated reason: Twitter hadn’t been straightforward about its problem with fake accounts he dubbed “spam bots.” Twitter sued, and two weeks before a 5-day trial was scheduled to begin, Musk changed his mind again, saying that he wanted to complete the deal after all.