Musk Starts His Twitter Ownership With Job Cuts, Insists The ‘Bird Is Freed’

Summary

• Musk says the “bird is freed” after $44 billion Twitter deal
• Musk dismisses Twitter CEO, CFO, policy chief
• Some Twitter users flag willingness to leave
• Poll shows employee job fears
• EU warns: “This bird will fly by our rules”

Elon Musk has assumed ownership of Twitter Inc (TWTR.N) with brutal efficiency, dismissing top executives but offering little clarity over how he will accomplish the ambitions he has drafted for the influential social media platform.

“The bird is freed,” he tweeted after he concluded his $44 billion acquisition on Thursday, referring to Twitter’s bird logo in a clear nod to his desire to see the company have fewer restrictions on content that can be posted.

The Tesla Inc (TSLA.O) CEO and self-proclaimed free speech absolutist has, however, he also said he intends to hinder the platform from becoming an echo chamber for hate and division.

Other goals include purposing to “defeat” spam bots on Twitter and make the algorithms that control how content is presented to its users freely accessible.

Yet Musk has not provided details on how he will accomplish all this and who will be the boss of the company. He has said he wants to reduce the workforce, leaving Twitter’s 7,500 employees worrying about their future. He also said on Thursday he did not acquire Twitter to gain more money but “to try to help humanity, whom I love.”

Less than 10% of 266 Twitter employees who took part in a survey on messaging app Blind hoped to still have their jobs in three months. Blind permits employees to voice grievances anonymously after they sign up with corporate emails.

Musk dismissed Twitter Chief Executive Parag Agrawal, legal affairs and policy chief Vijaya Gadde, and Chief Financial Officer Ned Segal, according to people with knowledge of the matter. He had accused them of misinforming him and Twitter investors over the number of fake accounts on the platform.

Agrawal and Segal were in Twitter’s San Francisco headquarters when the deal was finalized and were shown the door, the sources added.

Musk, who also heads rocket company SpaceX, wants to become Twitter’s interim CEO according to a person with knowledge of the matter and following a previous report by Reuters. Musk also intends to reverse permanent bans on users, Bloomberg said, mentioning a person conversant with the matter.

Musk, Twitter, and the executives did not instantly reply to requests for comment.

‘CHIEF TWIT’

Before finalizing the deal, Musk walked into Twitter’s headquarters on Wednesday with a big smile and a porcelain sink, later tweeting “let that sink in.” He changed his Twitter profile description to “Chief Twit.”

Musk said in May he would scrap Twitter’s ban on Donald Trump, whose account was deleted after the attack on the U.S. Capitol. A Trump representative did not instantly reply to a Reuters request for comment, but the former U.S. president had earlier on said he won’t return to the platform and has instead created his own social media app, Truth Social.

Musk attempted to quell Twitter employee fears that major job cuts are coming and promised advertisers that his past criticism of Twitter’s content moderation rules would not damage its appeal.

Musk said in an open letter to advertisers on Thursday:

“Twitter obviously cannot become a free-for-all hellscape, where anything can be said with no consequences!”

As news of the deal became known, some Twitter users were quick to indicate their willingness to leave.

“I will be happy to leave in a heartbeat if Musk, well, acts as we all expect him to,” said a user with the @mustlovedogsxo account.

European regulators also renewed previous warnings that, under Musk’s leadership, Twitter must still conform to the region’s Digital Services Act, which levies massive fines on companies if they do not regulate illegal content.

“In Europe, the bird will fly by our EU rules,” EU industry Chief Thierry Breton tweeted on Friday morning.

European Parliament lawmaker and civil rights proponent Patrick Breyer proposed that people seek alternatives where privacy is a priority.

“Twitter already knows our personalities dangerously well due to its pervasive surveillance of our every click. Now, this knowledge will be falling into Musk’s hands.”

Musk has said he sees Twitter as a foundation for developing a “super app” that offers everything from shopping to money transfers and ride-hailing.

But Twitter is grappling to engage its most active users who are crucial to the business. These “heavy tweeters” make up less than 10% of monthly overall users but create 90% of all tweets and half of global revenue.

Musk will face a challenge boosting revenue “given that the controversial opinions he appears to want to give more of a free rein to are often unpalatable to advertisers,” said Hargreaves Lansdown analyst Susannah Streeter.

A PERSISTENT TWITTER SAGA

This deal’s road to fruition was full of ups and downs that evoked doubt over whether it would happen at all. It started on April 4, when Musk revealed a 9.2% Twitter stake, becoming the company’s biggest shareholder.

The world’s wealthiest person then agreed to join Twitter’s board, only to refuse at the last minute and put in a bid to buy the company instead for $54.20 per share. In the course of just one weekend later in April, the two sides struck a deal without Musk conducting any due diligence on the company’s confidential information.

In the weeks that came after, Musk had a change of heart. He complained publicly about Twitter’s spam accounts and his lawyers then blamed Twitter for not fulfilling his requests for information on the subject.

The acrimony led to Musk telling Twitter on July 8 that he was bailing out of the deal. Four days later, Twitter sued Musk to compel him to finalize the acquisition.

By then, the stock market had crumbled on concerns about a likely recession. Twitter blamed Musk for buyer’s remorse, claiming he wanted to pull out of the deal because he thought he overpaid. Most legal analysts thought Twitter would likely win in court.

On Oct. 4, Musk performed another U-turn, offering to close the deal as promised. He was able to do that, just one day before a deadline to escape going to trial.

Shares of Twitter ended trade on Thursday jumping 0.3% at $53.86, just below the agreed price. The stock will be delisted from the New York Stock Exchange on Friday.