Elon Musk will buy Twitter for $ 44 billion and make it private – Daily Local

Tom Crischer and Matt O’Brien

Elon Musk reached an agreement to buy Twitter for about $ 44 billion on Monday, promising a softer approach to police content on a social media platform where he – the world’s richest man – promotes his interests, attacks critics and opinions on a wide range of issues. more than 83 million subscribers.

Open CEO Tesla has said it wants to own and privatize Twitter because it believes it is not fulfilling its potential as a platform for free speech.

In a joint statement with Twitter, Musk said he wants to make the service “better than ever” with new features by getting rid of automated “spam” accounts and making its algorithms public to increase trust.

“Freedom of speech is the foundation of a functioning democracy, and Twitter is a digital city square where issues vital to the future of humanity are discussed,” the 50-year-old Musk said, adding hearts, stars and smilies with rockets to the tweet. stressed the statement.

Musk’s approach to content moderation has led many users to worry that the platform will become more of a haven for misinformation, hatred and bullying, in order to mitigate the effects it has worked on in recent years. Wall Street analysts say that if it goes too far, it could also repel advertisers.

The deal was concluded about two weeks after the billionaire first revealed 9% of the platform’s shares. Last week, Musk said he had set aside $ 46.5 billion in funding to buy Twitter, putting pressure on the company’s board to negotiate an agreement.

Twitter reported that the deal was unanimously approved by the board of directors and is expected to close in 2022 until signed by regulators and shareholder approval.

Shares of Twitter Inc. rose more than 5% on Monday to $ 51.70 per share. On April 14, Musk announced an offer to buy Twitter for $ 54.20 per share. Although shares have risen sharply since Musk made his offer, they are well below the $ 77-a-share high he reached in February 2021.

Musk called himself an “freedom of speech absolutist,” but is also known for blocking or insulting other Twitter users who doubt or disagree with him.

In recent weeks, he has proposed easing restrictions on Twitter content – such as rules that suspended former President Donald Trump – while ridding the platform of fake spam accounts and abandoning advertising as a major revenue model. Musk believes he can increase revenue through subscriptions that give paying customers a better experience – perhaps even a version of Twitter without ads.

Asked during a recent TED interview whether there were any restrictions on his notion of “freedom of speech”, Musk said Twitter would comply with national laws restricting expression around the world. In addition, he said he would be “very reluctant” to delete messages or ban users who violate company rules forever.

It will not be perfect, Musk added, “but I think we want it to really have the perception and reality that speech is as free as possible.”

Following the announcement of the deal, the NAACP issued a statement urging Musk not to let Trump, the 45th president, back on the platform.

“Do not allow 45 to return to the platform,” the civil rights organization said in a statement. “Don’t let Twitter become a petri dish for hatred or lies that undermine our democracy.”

As both a candidate and a president, Trump has made Twitter a powerful megaphone for direct conversation with the public, often using incendiary and colloquial statements on pressing issues. After the storming of the Capitol on January 6, he was banned from service forever.

Advertisers, who are now Twitter’s main customers, are also pushing for tougher content rules that Musk has criticized. For them to be happy, we need to moderately limit hate speech so that brands do not try to promote their products alongside “calls for genocide,” said Siva Vaidhyanathan, a professor of media research at the University of Virginia.

“If Musk fires or banishes a team on Twitter that seeks to keep him clean and make it less hate-filled, he will immediately see a drop in user activity,” Vaidhyanathan said. “I think he’s pretty quick to see that inviting fanatics is bad for business.”

Some users said Monday that they plan to exit the platform if Musk takes over. To which he responded on Twitter: “I hope that even my worst critics will remain on Twitter, because that means freedom of speech.”

Musk also clashed with federal officials as a result of his own tweets, some of which he used to mock regulators of the Securities and Exchange Commission.

In one tweet in August 2018, for example, Musk claimed he had the funding to transfer Tesla to private companies for $ 420 a share, although the court ruled that was not the case. This has led to an SEC investigation against which Musk is still fighting. Most recently, Musk seemed to have broken SEC rules that required him to disclose that he had acquired a 5% stake in Twitter; instead he waited until he had more than 9%. Experts say these problems will not affect his acquisition of Twitter.

While the Twitter user base of more than 200 million remains much smaller than that of competitors such as Facebook and TikTok, the service is popular with celebrities, world leaders, journalists and intellectuals. Musk himself is a prolific Twitter with fans who rivals several pop stars in the ranks of the most popular accounts.

Last week, he said in SEC documents that the money would come from Morgan Stanley and other banks, some of which are secured by his huge stake in Tesla, the electric vehicle company he manages.

Musk has a fortune of nearly $ 268 billion, most of which is raised by shares of Tesla and SpaceX, his private space company. It is unclear how much money Musk keeps.

Musk began earning a fortune in 1999 when he sold Compaq Zip2, an online catalog of cartography and business, for $ 307 million. He used his share to create what would become PayPal, an online service that bypassed banks and allowed consumers to pay businesses directly. It was sold to eBay for $ 1.5 billion in 2002.

In the same year, Musk founded Space Exploration Technologies, or SpaceX, after discovering that cost constraints limit NASA’s interplanetary travel. Eventually the company developed cost-effective reusable missiles.

In 2004, Mask wanted to invest in Tesla, then a startup that was trying to build an electric car. He eventually became CEO and led the company to astronomical success as the world’s most valuable automaker and largest seller of electric vehicles.

Mask’s promise to make Twitter a haven for free speech could muffle the appeal of Donald Trump’s troubled Social Truth app, which the former president advertises as a Twitter competitor that will cater to conservatives. Truth Social is part of Trump’s new media company, which has agreed to publish Digital World Acquisition Corp. Shares of DWAC on Monday fell 16.2% and fell 46% after Musk revealed his stake in Twitter.

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Crisher reported from Detroit. This was reported by O’Brien of Providence, Rhode Island. Authors AP Business Writers Marcy Gordon of Washington, Barbara Ortutai of Auckland, California, and Kelvin Chan of London contributed to this report.