Twitter Mania: The Deal That Broke Elon Musk

On October 27th, 2022, Elon Musk signed a $44 billion deal for total control of Twitter. Hours later he gathered executives in San Francisco in what the New York Times calls a “war room,” to cut bonuses across the board and commence mass firings. This is the deal that broke Twitter. 

After the spur of immediate firings and layoffs, Twitter was in chaos. Musk, well known as the CEO of Tesla and SpaceX, seemed to have many ideas for the giant social media platform but no proper experience to execute them. 

Musk explained that his deal in acquiring Twitter was vital for “the future of civilization to have a common digital town square” without censorship and healthy debate. He described how “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." Altogether, Musk aimed to create an economically beneficial social platform in which everyone can participate in discourse important for the betterment of our society, meaning a society in which everyone has a voice in the dialogue. 

But how realistic is this? Twitter has always been a platform for extremism and hate speech. With the Twitter takeover, the New York Times reported a massive surge in hate speech across the platform. One alarming statistic is that before Elon Musk’s takeover of Twitter, slurs against Black Americans occurred 1,282 times per day on the platform but increased by more than 300% afterwards. CBS also reports that slurs against the LGBTQ+ community rose 58%. It seems that “healthy debate” and a “lack of censorship” do not go hand in hand. 

Another issue arising is Musk’s plans to transform Twitter into an economic commerce platform similar to that of Facebook, Pinterest, Instagram, and Amazon where individuals can shop and sell. 

However, Twitter is not designed as a commercial platform; it gained popularity from providing a network for users to share updates, talk about interests, and stir casual debates worldwide. Twitter’s current role in society would make a switch into the economic world difficult. 

On the topic of economic concerns, after the Twitter takeover, Musk lost immense amounts of advertiser revenue. “There’s concerns with advertisers around brand safety, and that’s really what this is all about,” said Rachel Tipograph, CEO of advertising technology firm MikMak. Musk blamed activists for putting pressure on his top advertisers. In response, Musk held audio broadcasts to address the concerns of advertisers such as General Motors and Volkswagen, who took active steps in reducing their ad campaigns on the platform. As documented by NPR, since then, 48 more major advertisers have also reduced or cut their involvement in the Twitter mania including Chevrolet, Chipotle Mexican Grill, and Kyndryl. 

According to a recording heard by the New York Times, Musk is aware of the rapid decline of the platform and even admits that bankruptcy is not out of the question. Due to its growing debt, Twitter continues to lay off workers, cutting employment boards by 50%. These numbers include higher-ranking employees, such as Vijaya Gadde, Twitter’s top legal and policy executive, a vital player in the company’s prior success. Musk decided to replace these employees with his own advisers, the majority coming from his other businesses. His own Tesla engineers who temporarily worked for him at Twitter concluded he would have to cut mass amounts of employees to stay afloat; only a few days later the company realized they had reduced too much of the workforce. After this major loss, more employees decided not to support his actions anymore, resulting in major walkouts. This left Twitter barren, unstable, and insufficient. 

Musk claimed that “Twitter can form an incredibly valuable service to the world and be the public town square.” He believes it can transform into a “battleground of ideas” where debate could “take the place of violence in a lot of cases.” But to reach this goal, Twitter will once again have to make the platform safe, stable, and enjoyable -  which can best be supported by a recovery of workforce numbers. With the recent decision of Elon Musk to step down, the fate of Twitter will be in the hands of new leadership -- the question now, will Twitter survive?