Even before the poison pill was adopted, the evidence is the market wasn't taking Musk's offer seriously. That's because he was offering $54.20 per share (ha ha, 420), but the stock price never closed higher than $48.36. So almost $6/share was left on the table.
Part of it is that Musk doesn't have $43B in cash, he'd have to raise it or borrow it. He's worth more than that but it isn't liquid; as an officer of Tesla there are some restrictions on when he can trade. Another part is that many doubt whether Musk is serious or if he is playing games again, like the last time "420" appeared in a financial announcement from him.
It means the market doesn't think it's likely but it doesn't mean it's 75%. To illustrate why that makes no sense, if Musk had offered $35 instead of $54, the buyout would be much less likely, since the price would be way lower and the board and shareholders less likely to accept it, yet under your model the likelihood would go up.
Estimating probability from price action is something you can do, but not like you did it.
Why would the likelihood go up under his model? If Musk had only offered $35 and people thought that was only 20% likely to happen (for the reasons you listed) then the market price would have only gone up to $31.
Say I offer to buy Apple for a penny/share. The price for their shares won’t move because of my offer but may move from normal market conditions. If the shares increased a dollar the day after my offer, would you say there’s a greater than 100% chance of my offer being accepted?
There of course the implicit assumption here that Musk's offer is causally related to Twitter's stock price. OPs comment make sense if you keep that in mind.
Interesting. As a point of comparison, when Microsoft bid a 62% premium for Yahoo back in '08, Yahoo stock spiked about 48%.
Doing the math, the market placed the likelihood at 48÷62=77%.
Where does the $30 come from? The last time Twitter was that low was May 2020. There’s no evidence that the market values Twitter at $30 without Musk’s bid.
That fair value valuation is subjective. The $35 number was arbitrarily chosen and is unknown, so the derived probability is meaningless as well.
The possibility of a take over changes the potential long term valuation of a company and thereby changes the demand for the stock. Basically, if enough people think the buyout would happen, or would just make Twitter more valuable (as a stock) than it is now, that increases the number of buyers and hence drives the price of the stock up.
If a buyout is certain, then the demand for free money is 100%, and demand for a sure loser is 0% of potential buyers. Hence the share price would quickly converge to a buyout price in that situation.
It’s definitely just a stunt… he doesn’t have the money, and said he expects larger shareholders to sign on to the deal… so he can take the company private and do great profit-maximizing ideas like turning their office into a homeless shelter. He’s presented no ideas that would increase twitters profits or market share. What shareholder would sign up for this?
The parent believes, based on Elon's own claims, that part of his plan of raising the money is to get some existing shareholders on board, essentially having them finance the deal, obviously by promising them a stake in the future private company.
They are also assuming an existing shareholder would only do this if they believe the future private Twitter would be a more profitable endeavor for them, which Musk's comments really shouldn't inspire confidence in.
That does make it seem less serious IMO, given he made the same claim about somehow keeping shareholders when he pretended he was going to take Tesla private
Ah, thanks for clarifying. I misread the parent's comment. Looks like they were referring specifically to the shareholders that choose to stay on as investors.
They wouldn't be divested. He's said he intends to allow the maximum number of shareholders legally allowed to continue as shareholders, that is, the biggest investors get to not divest if they want.
GP is implying that since Musk is relying on this in order to finance it since he doesn't have 43B in cash.
>He's said he intends to allow the maximum number of shareholders legally allowed to continue as shareholders, that is, the biggest investors get to not divest if they want
If this is a plausible scenario, and I don't know that it isn't, do you think it's what he means or is trying to express?
Because it seems to me that the way he says he'll keep the shareholders, it's intended to communicate to his countless groupies that they will somehow still be able to own Tesla in their Robinhood accounts. Which would be nonsense, right?
The real question is why would shareholders that care about profits own Twitter stock? In its entire history there have been 2 years it didn’t lose money and actually recorded a profit.
It's all about potential future profits. Not everyone agrees on what those profits could be, and hence why there is a market for shares, and is the reason why share prices are not stable.
Essentially, the holders believe that past performance is not reflective of possible future performance. The shorts and sellers and non buyers believe that us the case or that there are more efficient allocations of their money.
Went through a similar situation where a company was taken back private. The RSUs converted to cash value day of deal close and had a staggered payout with roughly the same vesting schedule.
Tesla has a rule that you can only borrow 25% of the value against the shares. From Money Stuff:
> Or Musk could borrow more against his Tesla stake. Tesla’s own policies prohibit Musk from borrowing more than 25% of the value of his shares, which is barely enough to buy Twitter, even ignoring the fact that he has already used at least some of that capacity. Of course he’s in charge of Tesla and its board is famously deferential to him, so I guess he could change those policies, but that still requires finding a bank to lend him $40 billion against his Tesla stake to finance this lark. Tesla’s stock has quadrupled since mid-2020; if it fell back to mid-2020 levels — say because its charismatic attention-seeking CEO found a new toy — then the loan would be underwater, and selling out of a gigantic Tesla margin loan does not seem like a lot of fun for a bank.
He also does not need to fund all of it; just enough that a bank would be willing to consider the Twitter shares he is purchasing as collateral for the rest of the loan.
I don't see this deal happening. He can't afford it (without exposing himself to unnecessary risk). If it does go through in the ways described here, he's an idiot ... and I don't believe that, despite my personal opinions about him.
Of course it's a lot of money and a lot of risk, but like him or hate him one thing Musk has consistently showed is that he's willing to take huge risks.
This deal likely won't haooen, but due to the poison pill, not due to the risk.
But in any case, my point was merely exactly what I wrote: he does not need to raise anywhere near the full amount, because he can utilize the shares he buy as part of the collateral.
A few when ago when Microsoft announced it was buying LinkedIn, the shares were trading around $10-$15 less than the announced acquisition price for months. I wouldn't put too much weight into any sort of imputed probability from the price.
> I wouldn't put too much weight into any sort of imputed probability from the price.
It's absolutely fair to impute a rough probability of deal closure from the stock price. The whole "merger arbitrage" industry works around that premise.
That's not the same as saying the market wasn't taking the offer seriously.
> The whole "merger arbitrage" industry works around that premise.
If the market price reflected the probability, then an arbitrage strategy should not be profitable.
Usually, these folks have better experience/skills/knowledge about M&A, antitrust, etc than the market average. In other words, the market doesn't reflect the probability of an event happening.
Yes, I wasn't commenting on the original "taking it seriously" language.
> If the market price reflected the probability, then an arbitrage strategy should not be profitable
> The market doesn't reflect the probability of an event happening.
No, the market's implied probability could be right, on average, across all deals...and the top merger arb funds could absolutely still be profitable by selecting deals when they think the market is mispricing the probability (for the reasons you mention: better experience, knowledge, etc.)
It's like the sports betting market: you can roughly impute a team's win probability from the (opening) betting line...and even if that's right on average, the top gamblers are still profitable.
And, of course, sometimes things with a say, 40% chance of happening do happen...so that doesn't mean the market was "wrong" about the chance (i.e. your LinkedIn mispricing exmaple).
But sounds like we're in full agreement you can't look at the implied probability from the market price and draw some conclusion about it definitely happening, or definitely not happening (e.g. the market not taking it seriously).
It’s important to also note that one of Musks strengths is marketing. He makes bold claims that makes headlines. We should be all used to his charade by now.
A lot of the stuff he claims that actually works has teams of people supporting him. Those weren’t one man efforts like this.
As you can see yourself, he's saying "great job team!" not "great job me!".
I just don't get all these olympic level contortions around denying the achievements of an immigrant who made good on the American dream, and has done more for climate change than literally anyone. This is to be celebrated and embraced!
FSD, Starlink never being jammed in Ukraine, Tesla Solar Roofs, and other such things are all things Musk has hyped up that are somewhat counter factual.
He was a RICH immigrant that made good on the American Dream. Having a truckload of money ready for you before you venture out in the world would be inspiring for anyone, believe me.
He may have started with less than the median American when he emigrated. Rich parent doesn't always equal rich kids. The ones that are mostly just consume. It's plainly obvious he's not some rich trust fund kid.
Which is why so many people are threatened by Elon's success and project their own insecurity onto him. Unresolved personal insecurity and envy are a potent combination. I promise this is unhelpful and it's better to resolve one's own insecurity than to spend time projecting it.
> He may have started with less than the median American when he emigrated
Except it is known that he didn’t. There is no need to speculate on the facts.
Elon Musk is far more successful than anyone else who started with his financial resources. He has outperformed everyone in his wealth bracket. There’s no need to pretend he was abandoned by his family and came to the US destitute.
There are internet rumors vs what he, his mom and brother say about him showering at the YMCA and only being able to afford one computer when starting Zip2.
That's why I said "may have", because his mom and brother aren't non-bias sources, and nor are insecure people on the Internet who want to explain away why they have achieved little despite having relatively the same or more privilege. The latter project this discomfort the most aggressively.
"After two years at Queen's University, Musk transferred to the University of Pennsylvania. He took on two majors, but his time there wasn’t all work and no play. With a fellow student, he bought a 10-bedroom fraternity house, which they used as an ad hoc nightclub."
Exactly! Many people underestimate the value of privileges'. Privileges' give "unfair" advantage. Anyway, there are many people like these and Elon is few among them that have successful ventures like Tesla or SpaceX.
Very interesting editing to your original post, when making such drastic edits that change the tone as much as you did it would be useful to make note of them so everyone knows.
You asked about things he had said/promoted, or something like that, which I listed in the first sentence of my response, care to respond to them?
The idea that his success is due to that is another olympic level contortion. He wasn't given millions of dollars to start, let alone billions. Even if he was, it would still be impressive converting that into Tesla and SpaceX, as opposed to a yacht.
Realize that most people born to well off parents don't do shit. If insecurity needs an outlet, maybe redirect it to the rich kids of Instagram, not the guy who is helping solve climate change and get us back into space.
I was not really commenting on how he achieved his success.
I was commenting on the appeal to the "American Dream(tm)".
Though if you want to follow it to the root if he was born black in the townships he likely would not have amounted to much, no matter how hard he worked it is unlikely he would have ever made it out of the country.
I don't understand why there would be something ironic, postmodern, satirical, or unexpected about a relatively privileged white South African who grew up in the era of apartheid being associated with space travel or other technology that is considered futuristic.
Nothing has changed. It is still as it has always been.
The US space program and the Moon landings can be traced directly back to Wernher Magnus Maximilian Freiherr von Braun and his work at Peenemünde, utilizing slave labor to build rockets for Nazi Germany.
"More people died building the V-2 rockets than were killed by it as a weapon"
The course of history was shaped by Von Braun being terrified of the Soviets and choosing to surrender to Americans.
Some people see this sort of historical note as extremely relevant to everything today, and some don't. I see nobody trying to bridge that gap.
Okay i explain the joke to you: First and foremost note how the comments upthread used the term "the american dream". Second note that "the american dream" is a media trope, a literary device and story we tell people to inspire them to follow certain ethics.
The traditional american dream is about social upwards mobility from rags to riches, about a promise that all that is needed to become wealthy is hard work, determination, a bit of ingenuity and puritan virtues. In its classic version it often features an immigrant family who comes to america with nothing but worn out clothes, works hard jobs and long hours to create a livelihood, overcomes hardships and struggles so their kids can get an education and better jobs. It often also calls out oppression, poverty and war in the old world as reasons for migration and to further highlight the ideals of liberal society in america.
The modern version ignored the generational aspect and instead focused on individuals becoming millionaires. Entertainment loves extremes, the lower the start and higher the end, the better. The quicker the journey, the better. And this became accelerated to the absurd. Be poor, wash dishes, millionaire. Since this is so very unlikely, and real people who fit it, like Rockefeller, became so unpresentable, media turned more and more towards fictitious comedies. Yet this version is still very dominant in culture, because it calls out a truth: when asked what the american dream is, many will say it is about becoming very rich. That is, what the modern american dreams of.
Now in contemporary media we see a return to the original idea, but with twist lampshading its problems. Migration is no longer a central topic, america no longer the beacon of hope for the tired, poor, huddled masses. Instead we see a focus on the disenfranchised and marginalized within american society. The post-modern MTV generations version of the american dream is B-Rabbit living in a trailer park with his alcoholic mom, making it as a rapper despite his peers attacking him for having the wrong skin color. It plays the core straight about making it with hard work and being virtuous, but it doesn't only look at materialism and individualism, as it also expects society to hold its promise of being liberal. The postmodern loves to play with dualities and reversing structures.
Lastly the post-modern satire version instead picks up the part that got dropped, the dream of becoming very rich. It teasers a protagonist from an african minority and reveals a wealthy and well educated white man from south africa. It shows upwards social movement from upper class to ultra rich, subverting the idealistic to instead highlight the reality that those who start well have more opportunities to venture and do even better. It holds up "being born rich" like Diogenes holds a plucked chicken, and calls out "behold: the american dream"
The pattern that I pointed out, that includes Von Braun, and Musk, is of people who, whatever their advantages and sins, were not privileged enough to be born in the US, and they then found unimaginably more opportunity in the US than in their homeland.
Is that how some people conceive of the "American dream"? I don't know, but I think it's the easiest to find factual evidence of happening over a long period of time.
The only version of the "American dream" I've ever heard was getting a small house on a ~1 acre lot and starting a family. I don't know what all this about becoming a millionaire is from.
-- a idk probably 10th generation American living on the East Coast.
> and has done more for climate change than literally anyone
What a sensationalist claim! What is the carbon offset of one rocket launch? If Elon stopped focusing on Mars, and instead bought every coal plant to then shutter and replace them (could be done for under 40b), then maybe. Until then, the few percentage of market share for EVs does not justify this claim. You also have to assume that every purchaser of a Tesla would have bought a gas car instead, which is seemingly not a safe assumption. So, citation needed!
Maybe if elon purchased a train system and made public transit exceptional and widely used could a person start to make this claim.
I thunk the sad reality is that elon is bored and us focused in sci fi that is more possible 500 to 100p years in the future (ie mars), at the expense of actually solving present day problems.
Any regulation reducing coal emissions has an out-sized impact compared to a few percentage of emissions from non-commercial transport, the claim "more than anyone else" seems hyperbolic and just flat out wrong
I don’t deny that, but it is not what he is doing here.
I am not sure why people shy away from the obvious: another of Musk’s strengths is market manipulation.
On 4 April, the announcement[0] of his becoming the largest shareholder jumped his Twitter stock[1] from a 73486938×33.03 = $2.4B purchase to a $3.7B asset, a $1.2B gain.
He sold 371900 stocks, for a $6M gain.
His 14 April announcement[2] of his offer to purchase Twitter was likely intended to boost the price further before the expected poison pill would justify him divesting everything as he stated he would do in the SEC filing[3], thus netting an even bigger gain.
It didn’t boost as he expected, but the value has remained higher than it started at. He will still make half a billion and his actions, this time, are hard to sue, since he did not lie on anything but intent, which is impossible to prove.
These paper profits are hard for him to realise, since he has to sell 9.2% of Twitter's stock without the price falling. Given the current price depends on his claimed intent to takeover, the market will react swiftly to any evidence that he is in fact reducing his stake.
> On 4 April, the announcement of his becoming the largest shareholder jumped his Twitter stock[0] from a $2.9B purchase to a $3.7B asset, a $779K gain.
I would upvote this as insightful if we were still on Slashdot. These one-man pioneers like to further the impression that they are the sole reasons for their success, but the reality is that we all build on the shoulders if giants. I am not shitting on his ability to make his endeavours successful - I am just saying that the proportion of his responsibility for it is much lower than most people think.
I'm not sure what it is about some societies that like to make a single person out to be an idol. We see it in team sports, scientists who work in large teams, businesses where CEOs are deemed several thousand times more of a factor than other workers, medicine where doctors are placed on pedestals. I guess people like a hero, and the alternative explanation, that hundreds of hard working and bright people came together to make something happen, is less compelling.
I would also mod your comment insightful ;) Egocentric individualism makes people forget that everyone, absolutely everyone, is indebted to people past and present, from his current fellow co-inhabitants of earth to the past generations all over the world that bequeathed him the world and the culture he inherited.
Ad hom is pushed by the media because “small minds talk about people,” and that sells ads/clicks. Another example beyond personal fanboyism is the vilification of a person which surpasses rationality. Or the vilification of other groups of people. In all of these you will see fundamental attribution error, ignoring the situational factors and placing all perceived agency on the individual, like most all of our media were doing from 2016-2020. The reality is, few humans are all that important in and of themselves, and those that are often have become so as the result of external factors like the quality of the people that surround them, or “luck.”
This rings so true for Elon Musk fanboys. I also like the full quote, "Small minds talk about people. Average minds talk about events. Great minds talk about ideas."
1) It's not a Trumpian charade because many of the things he says actually work out. He'd already be done otherwise.
That's what makes it so interesting. I suggest he would buy Twitter if he could - and - he benefits from the free PR either way.
Yes, it's a bit cynical of him, but the PR is worth it, and, it's not like he's playing with election outcomes, or starting wars.
2) We know he's not 'doing it himself' and I suggest his Eng. knowledge is way overstated, at the same time he is very 'detail / hands on / insightful at that level' and with the big vision stuff he gets people motivated. I disagree with almost everything he says publicly and loathe is fanboys, but he still deserves enormous credit.
The whole thing seems like a stunt by Elon. I don't care either way, but it would have been interesting for the board to call Elon's bluff and watch him back out at the last minute.
Elon should really focus on his unfulfilled promises to folks he already took money from, not playing immature games to keep himself on the front page. I don't know what drugs he did with his ex-girlfriend, but they don't appear to have had a positive effect on his well being.
This makes no sense because if the market was 100% confident in Elon’s offer, but saw a 25% chance of a poison pill you would end up at the same place. The market was in fact incorrect in the likelihood of a poison pill, not Elon’s wealth or ability to raise funds.
Are you saying that if a share is destined to be sold for 54.20 people will buy it for 54 prior to that? its only reasonable to think it will be somewhat lower.
So, I'm not very corporate savvy and this might be a very stupid question. Is there a NON-culture/political reason for all the push back against Musk buying Twitter? From the read, this just seem to be opening the door for someone else to try and take majority control and pining away for the days of Dorsey (which, if looked at objectively, weren't great... just filling an opportunity).
The pushback is simple: Twitter stock price was higher than Musk’s offer for most of 2021. We are in a downturn affecting the entire tech industry, and it’s likely that prices will return to previous levels at some point. Elon’s offer is a lowball and Twitter can bring more value to shareholders with or without Elon.
I don't immediately buy the logic of "Stock A hit a peak of $X last year, therefore that is the correct price/valuation, and not the lower price it is right now"
If Twitter was worth more, it'd be worth more.
With that logic, you should put a huge chunk of your savings into Twitter to benefit from the insight, as it's currently trading at 39% below its 52-week high.
Indeed, note that the only rational reason not to buy TWTR right now is the simultaneous belief that (a) it's not underpriced but also (b) Musk will never [be allowed to] make the purchase. If you disagreed with either of those statements, then it would be irrational not to buy TWTR, because either way you'd profit.
The argument is not that is worth more, it is that it can be worth more in the future than Musk offer. No one can predict the future, but it is a legitimate reason to believe it can be worth more than $54 in the future and pointing that it was worth more last year is just an argument for the belief. Which makes sense to me.
As legitimate as it is to believe that the stock price will never again reach $54.
The disconnect between you two seems to be an understanding of what the price of a stock means.
The stock price today represents what investors think the future value might be. The speculation that the dip will bounce back is built into today's price.
The reduced price over the high represents the perceived risk that it won't return.
Musk values the stock higher than the mean investor.
I think we have to tolerate a certain amount of irrationality from shareholders.
If you bought a $100k home which then dipped to $80k during Covid, would you accept an unsolicited bid of $90k?
It's reasonable for some people to take the bid, since you could arguably buy another comparable house for $80k and pocket the $10k difference, but I think a lot of other people would reasonably choose not to.
(I'm not totally sure if this logic scales to board rooms / billions of dollars, but curious to hear thoughts.)
I don't think the logical disconnect here is about whether it scales to billions of dollars. The problem is that people live in their homes and there are many frictional costs associated with moving. You need to pick something much more fungible.
I own several stocks that have dropped in the last few months. If someone offered me a 20% premium to sell them today, I would do so in a heartbeat. I would even do so if it meant the company would go private and I couldn't buy that stock again.
It seems a little funny to me that people flock to the idea that Twitter's market cap in a fed-fueled stock market when literally everything was moving up is some kind of true valuation for Tiwtter. If anything Twitter is likely trading at or very close to its fair value now then it was last year when retail was throwing money into anything.
I think the argument is that if long term holders wanted to sell at this sort of valuation then they would have last year when it was way higher. If there was a bunch of retail money fuelling it then they could have took advantage and got out but they didn’t. So why would they sell now for a smaller upside?
GME is a bit weird because it was essentially a crowdsourced fundraising round for Ryan Cohen SPAC, expecting an NFT play. (Which I expect will fail spectacularly)
> We are in a downturn affecting the entire tech industry, and it’s likely that prices will return to previous levels at some point.
So why not take the offer (which is 20% higher than the current market price for the stock) and put the received cashed into other tech stocks? Is Twitter uniquely/excessively down compared to other tech stocks, and due for a bigger rebound?
Twitter wouldn't exist in this scenario from the stock holder's perspective. They would get cash and then put that cash into other investments of their choosing.
The only way this makes sense is if there is a bigger offer incoming OR if the Twitter board has a plan to make twitter much more successful in the near term and succeeds at that plan.
I think the "not a hedge fund" part is referring to the fact that this would be a taxable event for the average stockholder. You can't just presto move that same amount into another tax stock.
No, they meant that Twitter is a specific business that shareholders believe in, not just a financial vehicle. Like part of the value of your house is that it is your home, not just a liquid investment.
Taxation is only a concern for folks who have big unrealized gains and lack harvestable unrealized losses.
In 2016 Microsoft acquired LinkedIn at a $26 billion valuation, which was at the time a premium of ~40% or so over the current price, but still lower than their valuation was the previous year. So it isn't unprecedented to accept an offer for an amount lower than your all time high Elon's offer is a 38% premium over the price it was prior to him disclosing his position in the company.
> We are in a downturn affecting the entire tech industry
Some companies are down more than others, and some are doing fine. Twitter revenue is largely driven by ads and they are likely also going to be hit by Apple's privacy changes like all other ad based businesses. Meta (Facebook) has already said they expect ~$10 billion revenue hit from the changes. It's feasible to think that Twitter revenue for the year may actually drop and the stock price may not recover to the 2021 levels any time soon.
IIRC The Apple privacy changes hit a very specific kind of targeted advertising that Facebook was great at monetizing. I’m not familiar with Twitters ad platform but it’s unlikely to have affected them as hard as they hit FB.
Counterpoint: it's not a downturn, just a return to reality. Tech stock valuations were sky high in late 2020 / early 2021, and even considering recent drops most are still above their pre-pandemic levels.
Totally possible, but the original question was "Is there a NON-culture/political reason for all the push back" and "Twitter stock price was higher than Musk’s offer for most of 2021" is definitely a non-cultural/political reason to push back on the offer.
Again, you might be right that Twitter's price was over-inflated in 2021, but "it was worth more" is certainly a non-cultural/political reason to push back on the offer - even if they're wrong about Twitter's long-term value.
>Twitter stock price was higher than Musk’s offer for most of 2021.
That's cute but the past is gone. Twitter is clearly going downhill, both with their product and with their management (good thing they got rid of Dorsey, but perhaps that was too little too late), the stock just follows on that. If anything, people like Musk are the ones who still attract interest to the platform.
>Twitter can bring more value to shareholders with or without Elon
Twitter is on a very dangerous spot right now, their MAUs peaked long ago as young people go to other platforms, and overall, everyone is a bit of tired of the kind of discourse that predominates there, for instance, Trump was banned and I STILL find out everything about him because the people there (left and right-wing) are absolutely obsessed with him.
Honestly, Twitter is the one social media platform that I wouldn't really mind if it just disappeared. At least Facebook has some family members in there and some pictures from my earlier years. Twitter brings nothing of value to my life and I'm sure I'm not the only one who feels like that.
> and it’s likely that prices will return to previous levels at some point
Wow, that's great news for Velodyne Lidar -- currently trading around $2 and was $28 less than 2 years ago. (Why bother with paltry 2x return on Twitter when you could get a 14x return?)
Their stock dropped along with Facebook and other media platforms the second Apple stopped them from tracking users everywhere. That's without mentioning the crazy overvalue problem such companies already have.
Against this specific bid: the price is arguably low and holders aren’t likely to want to sell at that price. From Money Stuff:
> problem with Musk’s offer is that it is pretty low. Musk points out that $54.20 “represents a 54% premium” over where he started investing in Twitter, and a 38% premium over where the stock was before he announced his position. But Twitter was in the $60s in October, and a lot of its big long-term holders seem unlikely to be sellers at $54.20. “‘No board in America is going to take that number,’ said Jefferies analyst Brent Thill.”
Against the bid coming from him:
- He famously pretended he was going to take Tesla private and got in trouble because he was pretending. Takeover offers usually don’t have that history I guess.
- He doesn’t have financing, not even pretend financing like when he said he was going to take Tesla private
As a shareholder, either you are happy with the price Musk is offering you, or you think the company can do even better long term. Twitter is clearly a very valuable asset, considering this fight is happening in the first place, so it is not inconceivable that >50% of shareholders will want a larger buyout. Heck even if you are completely happy with the terms, pushing back and asking for more is a standard negotiation tactic. They'd be foolish not to try.
Surely there is both a status quo and survival bias going on with the existing leadership/management team. When you have an outside person who wants to change some fundamental things about the company, it seems natural that there would be resistance.
As an outsider, I'm personally intrigued by the prospect. There are two things he's mentioned that I think could be very beneficial (outside of freedom of expression) to society:
1. Transparency - open sourced algorithms for what shows when and transparency about moderation decisions
2. Reduced short-term financial incentives - Given it'd be bank-rolled by someone with a lot of money and private, they wouldn't need to play the gray area game of increasing advertising & data sharing that other sites do.
The sad truth is that this is an intense political battle. I would personally favor Elon Musk taking over and shaking things up, any other position is untenable. And, I am saying this as a progressive. I think an open and transparent social platform would be great for the society.
The issue is that managerial class of America, both in private and public sector, are in bed with each other. The government cannot suppress free speech using the frontdoor, but these social media companies (Meta, Twitter) as well as Big Tech machinery (Google, Apple, Microsoft, Amazon) act as a proxy for supressing political speech through opaque algorithms and straight up censorship.
We, liberals, used to be exceptionally devoted to free speech. Just look up ACLU's cases from the 90's and prior. We were against the establishment. Against the managerial class crushing labor. Against the fucking 3 letter agencies.
Now, my own party wants to turn America into an authoritarian censorship dystopia. It's hard to stand by that.
Just as the Republican Party has been taken over by neocons, the Democrat Party has been taken over by neolibs. They both have the same ideas and are never on the oposite sides. That is why you see endless and meanilingless wars, media conglomerates, censorship, billionaire-class, 3-letter-agencies off the leash, workers in diapers.
> Now, my own party wants to turn America into an authoritarian censorship dystopia
You could start by lobbying to force tech companies over a certain size to disclose reasons for users or content being removed from the platform. The legislation would have to have teeth, naturally.
There's nothing conspiratorial about pointing out the close ties between organisations like the ACLU and HRC and the Democratic party, if that's what you mean.
Sad truth is, the moment an advocacy group and a political party become too close, the advocacy group ceases to be effective. This has nothing to do with Democrats in particular; cozying up to the Republicans is no different (e.g. the NRA).
I'm heartened by the emergence of organisations like FIRE that are picking up the baton for free speech in some of the contexts where the ACLU has completely dropped the ball, but still feel a pang of sadness at the hollowing out of the old, bad-ass ACLU.
I don’t understand how any board can implement a “poison pill”, not just Twitter but Netflix and others, and not be found working against the interest of shareholders. Can anyone help me understand?
You’re categorically changing the profile of the stock. This has a chilling effect on large investors, including but not limited just to Musk, right?
Vanguard, for example, has just had its range of further investment limited arbitrarily. Isn’t that bad for all stockholders, to know that large stakeholders will not drive the price up if they somehow gain substantial belief in the company?
The risk portfolio of Vanguard just went up considerably because in the case that they fully lose faith in the board, they no longer have the option of installing a friendly board, they must simply liquidate their holdings. This, in turn, makes them more skeptical of further smaller (non-takeover) investment because it’s more to liquidate and more risk.
Who does this benefit besides the board? I guess I understand that the board is not beholden to the interests of all shareholders equally, and I’m not suggesting that this doesn’t benefit some shareholders, but where does the line start?
If I was a member of Twitter's board, Musk's history of erratic public behavior, SEC settlement, and openly hostile attitude towards the company's employees would be more than sufficient to justify my belief that his controlling ownership would not be in the interest of the current average shareholder.
That opinion would also be consistent with how "fiduciary duty" is interpreted by US regulators: companies are not required to perform any particular action that might reasonably be in the interests of shareholders; they must merely show that the company's actions were intended to be in the best interests of the shareholders.
Yishan Wong , the CEO of Reddit until 2012 have tweeted a long thread about how Musk doesn't understand the current state of moderation necessary because he was much more involved with an earlier Internet. But I am of opinion that Yishan is also behind as one half of the debaters simply left facts and reality behind. This post here is an example.
Shareholding is not democratic. It is one-dollar-one-vote and therefore plutocratic rather than democratic.
(I was going to say it also involves too much money to be lefty, but then I realise that just might be my Overton window and isn’t necessarily related to what you think “lefty” means).
The massive and immediate shift from "It's a private company and they can do what they want" to chanting in unison "This is a danger to our democracy" has been horrifying to watch.
I don't own a TV, and yet I can tell you what the chiron said this morning, nearly verbatim. Ask anyone who watched it.
> fate of the company after it has been taken private doesn't matter as far as "fiduciary duty" is concerned
If it goes private. As always, Matt Levine says it better than I can:
"...the financing seems to be made up of cobwebs and phlogiston. But also Musk has joked about taking companies private before, and he generally changes his mind a lot. (He agreed to join Twitter’s board last week! And then changed his mind four days later!) If you are a well-advised professional public company board, it is just catastrophic to imagine that you might say 'okay Elon $54.20 it is' and then he’d say 'ha no I was kidding, psych!' That would be crippling for a public company. Also that is basically what he did to Twitter’s board last weekend!"
Levine is being disingenuous, as usual. Obviously he would have banks and investors fighting to finance the deal. Wouldn't a breakup penalty address the breakup problem?
> Wouldn't a breakup penalty address the breakup problem?
No. If you’re at a table negotiating a break-up penalty, you’ve already crossed the Rubicon. You have indicated that the price was at the very least worth considering.
If that buyer then walks before agreeing to the break-up penalty, the damage has been done. Board seats have been lost for less.
Not to mention he is being disingenuous by implying there was no material change between getting offered a seat at the board, and hearing what accepting that seat would entail.
It sounds like Musk received the offer, accepted it and changed his mind afterwards. That is, after accepting the terms, not after receiving them. If that’s the sequence of events, I don’t think Levine is being disingenuous.
However, I think it's a harder case to argue when twitter stock closed at $.18 above the price they went public at in 2013. Sounds like whatever it is they have been doing hasn't been in the interest of the average shareholder either.
One can equally argue that opens sourcing Twitter algorithm and building trust would bring incalculable number of new users, have a profound impact on their ad business and not to mention, cut down their competitor's moat. People will flock to Twitter like bees. Ad revenue + subscription would skyrocket.
So, it can go either way and can be argued either way.
which part do you want open sourced? timelines are generated after going through machine learning and then multiple services. even then, some of the infrastructure limits what you see in the end.
> Unfortunately, Haplo has its limits. Since we try to pull every single Tweet ID in a conversation every time a conversation is loaded in real-time, this is potentially an unbounded amount of data. We’ve found that if our platform tries to load more than a certain number of entries from our cache at once, our cache request latency will spike, and we begin to time-out on a significant fraction of read requests. Because of this, there is a limit of thousands of Tweets per conversation tree in this cache.
even just showing an ad is a ton work has a bunch of services involved
Also genuine, why would a person believe that would happen? The foremost thing that comes to mind is they'd be giving something of great value and receiving nothing in return.
Transparency i can agree with, i think twitter does a horrible job at that. especially explaining the rumored shadow bans and stuff. But i think thats different then open source code
> If I was a member of Twitter's board, Musk's history of erratic public behavior, SEC settlement, and openly hostile attitude towards the company's employees would be more than sufficient to justify my belief that his controlling ownership would not be in the interest of the current average shareholder.
That... makes absolutely no sense. The interest of the current average shareholder ends when they sell their stock. There is no point in time at which both (1) the current average shareholder owns more than zero shares, and (2) Musk has a controlling interest. So it's impossible for those two things to conflict.
If you were a member of Twitters board, would it be in the interest of the current average shareholder to sell their shares at well above the market price?
> If you were a member of Twitters board, would it be in the interest of the current average shareholder to sell their shares at well above the market price?
That definitionally depends on whether you, as that hypothetical board member, believe that Twitter has the potential to reach a share price higher than $54.20 if it stays public.
Also, remember there is nothing that binds the board of a company to solely consider potential shareholder value in the actions they take. There's a widespread belief that "fiduciary duty" overrides all other concerns, but from a regulatory/legal standpoint, that's simply not so. The board obviously needs to take it into account, but if they believe a merger or takeover is not in the best interest of the company, they don't have to take it.
It depends on how you define fiduciary responsibility. If it’s a point in time, transactional view, yes. If it’s a long term view of maximizing share holder value over time, not necessarily.
> If I was a member of Twitter's board, Musk's history of erratic public behavior, SEC settlement, and openly hostile attitude towards the company's employees would be more than sufficient to justify my belief that his controlling ownership would not be in the interest of the current average shareholder.
But all that is irrelevant because he wants to take the company private- no shareholders. The impact to shareholders is the massive bailout he would give them on their shares.
If they cared about shareholders best interests they would bring it to vote.
As a Netflix shareholder at the time they adopted their poison pill, I feel like the subsequent ~40x increase in share price has been very much in my interest. :-)
Of course hindsight is 20/20, but even at the time, it seemed like the company was prioritizing long-term growth, whereas if they were taken over by Carl Icahn, they'd certainly not be.
Twitter definitely isn’t Netflix. It’s been a dog since IPO, languished under a part time disinterested CEO, and only peaked because of the pandemic meme stock era.
As an individual and index shareholder I’d love for Musk to take it away at a premium, I have zero faith management will do anything positive.
Strong agree, Twitter hasn't grown their user base more than 10% since 2015, they might be making more revenue per user but annual revenue is likely ready to plateau if it hasn't already. Getting a premium on your stock is a good option if you can get it and a natural outcome of investing.
Wait, if some ETF accidentally exceeds 15%, then what? First of all, that'll screw over a bunch of small investors, right?
Second, could Elon swoop in at that point?
Edit: Also, if Elon is reading this, I'll happily buy 14.9% of twitter, and vote as part of your block. Just pay me enough to cover the sale and taxes, plus 1%.
> Edit: Also, if Elon is reading this, I'll happily buy 14.9% of twitter, and vote as part of your block. Just pay me enough to cover the sale and taxes, plus 1%.
You might want to speak with a lawyer who is familiar with inchoate crime.
What you publicly proposed to Elon is a crime, since you intend to conceal beneficial ownership of shares.
> since you intend to conceal beneficial ownership of shares
Promising voting rights doesn't change beneficial ownership. Twitter would have precedent, however, to find "conscious parallelism" and thus "a de facto control bloc" between the commenter and Musk, and thus bundle them for purposes of the poison pill's activation [1].
Still, not a crime. Civil dispute under corporate law.
As of January 2021 there is a whole bunch of new reporting requirements for beneficial ownership to combat money laundering and hiding assets. Structuring a stock trade to conceal the actual owner of securities (note the parent poster didn't offer to vote HIS shares) and failing to file disclosures is absolutely criminal.
The Yale Law article you cite is just about groups of investors working together, which is within their rights.
It's not a crime to publicly finance someone else's stock purchases, or even to publicly solicit others to finance your stock purchases (it's not "solicitation" in the inchoate sense, since the inducement is not towards a crime).
> What you publicly proposed to Elon is a crime, since you intend to conceal beneficial ownership of shares.
Not really.
Setting aside the other issues, first and foremost this is obviously a joke. Prosecution would have to establish mens rea for this to rise to a criminal act. Do you think anyone could prove true intent for these events to unfold, based on this comment?
Yeah, there's no concealment and no beneficial ownership. "I'll vote as part of your bloc" isn't beneficial ownership. (At most it's delegating the 'control' aspect of the equity, but even that is a stretch - in context, it's clearly a statement of incidental agreement with his opinion on this point, not a total delegation of control no matter what he should choose to do in future.)
Agreed, but there'd be no attempt at concealment (I didn't know beneficial ownership of shares was a thing), so, while it would be dumb to hand me and the IRS a large pile of cash, it sounds like it would probably still trigger the poison pill, and not be illegal.
If doing it above board wouldn't make sense anyway, that means the idea is to do something illegal. You'd know who controls the board, how many shares the person currently buying it has secured, which way votes are going to go before they happen, etc. The rest of the shareholders, the rest of the whole market, wouldn't. You'd claim (and would probably have to in sworn testimony) that billion dollar gifts to you from Elon Musk, including your stock itself, were incidental.
It’s pretty fundamental to investment / mutual funds. Vanguard, Blackrock, etc. None of them are the beneficial owners of Tesla, but all of them are coordinating the activities of millions of investors they represent.
That's what I mean. If it were the case that coordination can't be done, it violates every normative expectation.
Keep in mind, I lump in people's behavior with normative restrictions of the First Amendment. If the Government can't do it, and the Government is us, we shouldn't be doing it. So businesses doing it because business doesn't hold for me either. Especially if it happens as a method of indirection to work around literal interpretation.
So if there is a restriction on shareholder coordination, I don't see how our legal system in this case can be taken seriously as anything but a tool utilized by those in positions of influence capable of more tightly coupling to other people of influence.
I agree with your conclusion but not really your reasoning. There are countless things the government can’t do, which individual people can do. I can respect an establishment of religion. I can spend money without a transparent and disinterested tender process. Etc etc. You seem to be taking a very literalistic, almost theological reading of “the government is the people” - yes, the people choose and appoint a government to represent them, but hopefully you understand that the government isn’t metaphysically the same thing as the people.
Saying “the government is the people” is much like saying “the shareholders are the managers of the company”: yes, that’s true in an oblique, ideal sense, but you’re going to run into trouble if you start trying to literally substitute the one for the other in random sentences.
They all register and file disclosures though. A private fund of this size concealing its existence, its structure, and its objectives, is immoral and bad for the stock.
And inchoate crimes don't require the person to do as you commanded them. Just the statement above would probably be enough to charge someone. And even if the crime you are encouraging someone to commit is impossible (for instance, asking Musk to buy 110% of Twitter through you), it is *still* a crime for you to have asked him.
I’m not sure how the second part of your claim holds up if you treat your first contention (with which I agree) as a precondition. In particular, I think it wouldn’t be possible to prove mens rea, which you’d have to do if no crime ended up being perpetrated and you’re charging someone only for the alleged solicitation of an inchoate crime?
I imagine if an ETF accidentally exceeded 15% then the board would go talk to the fund managers and maybe get them to sign some documents. This isn't a computer program that will automatically trigger armageddon. It is just some new rules that mean if you turn up at a board meeting saying 'haha, I just bought your company and you are all fired', the board gets to say 'nope, we just issued a bazillion shares and gave them to all the existing holders except you, and you now own just 14.9%, sorry not sorry for your loss'.
This happened with SKT (Tanger outlets) which is a high dividend paying stock in SDY ETF. The ETF was approaching 50% ownership stake.
The fund needs to report their holdings. Not all companies have a poison pill provision. Not all companies that do have a poison pill will activate it. In the case of an ETF there's usually a discussion between the portfolio manager and the company. They know where they stand. Plus it's not really in a passive fund mandate to go activist.
Don't think that's true. ETF fund managers, when faced with a corporate action decision, will always vote for whatever maximizes their shareholders value.
Courts have upheld poison pills that treat 13D and 13G filers differently. I'd wager most ETFs that hold 5% of major public companies are 13G filers. Vanguard files a 13G for twitter. To be fair idk what the twitter pill will do - maybe it will be more aggressive.
An ETF isn’t going to “accidentally” exceed 15% ownership of Twitter.
Seriously, do you think funds playing with the kind of money to buy 15% of twitter often make careless purchases?
>Edit: Also, if Elon is reading this, I'll happily buy 14.9% of twitter, and vote as part of your block. Just pay me enough to cover the sale and taxes, plus 1%.
Such an arrangement would make Elon the beneficial owner of your shares.
Barclay's literally forgot to register with the SEC to be allowed to issue securities, then issued $15bn of them over the course of years, and lost $600m as a result. If you think "funds with this kind of money" are any better than a pack of chimps, then you should direct that "seriously" back at yourself.
Just because one tiny fund screwed up once does not mean that it is anywhere near likely that any ETF would screw up in a manner that would trigger this poison pill.
$15bn is tiny, presumably we’re talking about big ETFs like SPY here.
And anyway, you’re pretty much agreeing with me. It’s absolutely possible for a big fund to make a huge and hilariously stupid mistake, but this twitter poison pill does not meaningfully affect the chances of that happening.
In a world where you can shoot yourself in the foot in a million ways, it is utterly pointless to speculate about this one extraordinarily unlikely situation.
What? Barclays is one of the largest financial institutions in the world with $1.9tn in assets.
I think we're in agreement that this Twitter thing isn't worth the attention, but we are far from agreeing that large financial institutions are inherently competent because they're large.
I was literally wondering what would happen. ETFs are supposed to be algorithmically traded right?
There's a race condition between the poison pill being instated and the ETF updating their strategy. I wonder if a board could maliciously take advantage of that somehow.
ETFs generally aren’t managed without human involvement, and this poison pill isn’t software either. You’re taking concepts that exist in worlds like Ethereum and applying it to normal finance. That’s not how it works.
> but we are far from agreeing that large financial institutions are inherently competent because they're large.
I don’t see anyone making that argument.
Speculating on an ETF “accidentally” acquiring more than 15% of Twitter implies a whole different level of incompetence than a big ETF ever fucking up big.
Could you please stop breaking the site guidelines, regardless of how bad another comment is or you feel it is? You've been doing it a lot, unfortunately, and we've already warned you several times. If it keeps up we're going to end up having to ban you.
What’s the problem with my comment? The word “fuck”? The fact that the other commenter got offended because I pointed out their very real struggles with reading comprehension?
I did not call kolbes comments bad, but patiently explained where they got it wrong.
I think you’re seeing fighting where there’s none, at least not on my side.
For starters, "Yeah, I’m sorry that you can’t understand English" was obviously an egregious violation of the site guidelines.
We don't care about people saying "fuck". We care about the things that are in the guidelines, such as being kind, not being snarky, not calling names, and so on.
What you wrote would be taken by most readers as an obvious personal attack. If you say you didn't intend it that way, ok, but we still have to ban accounts that post like that, because such comments are indistinguishable from garden-variety personal attacks.
Good luck with that perspective in life. I'll stick with writing clearly. You stick with writing poorly and flipping out whenever people misunderstand your intentions.
You broke the site guidelines badly in this thread. Please don't do that, regardless of how bad another comment is or you feel it is. We ban accounts that do that because it's so destructive of what this site is supposed to be for.
Index funds do, that's pretty much the definition of an index fund.
ETFs are a different concept, but a good index fund will be structured as an ETF, and it looks like this thread is using "ETF" to mean "index fund"? If so, then the answer to your question is an unambiguous yes.
I’m curious what happens in that case, then - let’s say hypothetically that SPY has enough cash come into the fund that they’ll cross that threshold if they follow their stated investment policy (“buy the S&P”) - what’s the move, then?
How far can you go with that strategy? The derivative assets aren’t going to fully move with the price, and can have much higher volatility than the asset you’re trying to avoid buying.
They will talk to Twitter board and make an agreement with them to not trigger the poison pill, and continue buying shares.
Such an agreement would be reached incredibly quickly, there would be no need for stopgap measures.
From the article:
> Under the new structure, if any person or group acquires beneficial ownership of at least 15% of Twitter’s outstanding common stock without the board’s approval
> You’re categorically changing the profile of the stock.
Mechanically, it's not much different than an issue of new shares. From Twitter's announcement:
>> each right will entitle its holder [...] to purchase, at the then-current exercise price, additional shares of common stock having a then-current market value of twice the exercise price of the right.
There's no obvious breach of fiduciary duty through this plan. Existing (non-Musk) investors get new shares, but Twitter also raises capital at the current market price.
You can read "Barbarians at the Gate" for some 1980s history of corporate raiding. Back then, it was pure greed and ego. So unlike today [smile emoji].
The "poison pill" defense is very old. I'm not going to defend or attack it; it is what it is.
I WILL observe that, once a stock is "in play" it usually gets acquired, or at least gets a bunch of new board members.
Elon's offer is at the same time an hostile offer, and conditional on obtaining financing from banks. This is never heard of in the history of hostile acquisitions, and is a BIG risk for the board to entertain any attempt by anyone to buy Twitter before they know what their loan percentages are.
The offer is technically hostile because it was unsolicited, and the offer was made at the same time he indicated he wanted to buy-out the company (usually there's a gap).
A more typical way of doing this would be to make a proposal directly to the board first. The fact that Elon did it in public means he's trying to pressure the board (via the shareholders) into taking an action they wouldn't otherwise want to take which makes it hostile.
No it isn't. They key is that management and board are against it and the deal is still pursued by the (potential) acquirer. It is perfectly possible to initiate a conversation regarding an acquisition and this is not a hostile takeover per-se though it could develop into one.
Musk made an unsolicited, and what seems to be a non-investment choice, purchase of almost 10% of the shares and wanted to join the board. As far as I can tell, the board made his board seat contingent on Musk not buying more than 14.9% and Musk said no, and a few days later offered to buy the company outright. Now Twitter is taking moves to prevent a hostile takeover. That sounds like a hostile takeover to me.
Yes it does, and this is underlined by the fact that they adopted the poison pill proposal. Though, in the past such tactics have been used just to get a better price, in investment banking 'no' doesn't really always mean 'no', it may just mean 'really, no, not at this price'. That said this is already a pretty premium and they might end up regretting that move if they really are after the money and don't have a different motivation.
What? This is not just wrong, it's comical to even think of what it would mean if it were true. The board would have to clairvoyantly foresee any possible acquirer who might be interested in the company, or else reach out to every company and individual in the world, stating its willingness - or otherwise - to be acquired. That would be, uh, quite something.
Not necessarily, the offer could be amended and increased that's perfectly normal and still not hostile. Hostile is when you pursue against the wishes of the current owners of the company and their management, so in other words if they have indicated that they are either not for sale or that they are not going to sell their shares to you.
You could then try for a hostile takeover by buying up as much as you can on the open market and possibly to try to get one or two smaller shareholders to sell their shares to get you more than 51% (and in some cases more than 66% aka a supermajority) to be able to call the shots.
Even then, the Twitter board has staggered terms, so it is impossible to do a wholesale replacement of the board and thereby gain control of Twitter. The board voted unanimously to invoke the poison pill provisions in the bylaws so it isn't a matter of swaying a small number of board members.
Tender offers can be hostile - a "hostile tender offer" is an offer directly to shareholders to buy shares at a certain price, without getting the blessing of the board.
Of course it does, but we also have no idea what happened behind the scenes and the board does. He turned down joining the board last week basically because he could act like a troll if he did (I’m being facetious). Calling musk the richest man in the world is also kind of silly because he’s not offering to stock swap for Tesla shares…he has a lot of theoretical wealth, which as with many factors would play in the boards decision about whether this is serious.
My point is that the number on the offer is not an objective and singular measure of whether this is a good deal for Twitter. Who is making the offer clearly matters as well to how serious it is.
Hmm, not sure I understand what you are saying here. If Elon gets a loan using his Tesla stock as a guarantee, the risk is solely his. If he puts together a consortium to do the purchase, then that group is taking the risk. It doesn't matter though, given the Twitter bylaws, if the Board doesn't want it to happen it won't happen.
Unless I'm missing something, 'leveraged buyout' doesn't specify that it's Twitter's equity which has to be leveraged. Off the top of my head, I think Elon Musk has some other bits and pieces which he could scrounge together for collateral.
Hm, that doesn’t sound right, and Wikipedia agrees with my understanding, that an LBO means the buyer borrows money for it:
>> A leveraged buyout (LBO) is one company's acquisition of another company using a significant amount of borrowed money (leverage) to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loans, along with the assets of the acquiring company.
Note how the second sentence says that the assets of the purchased company can be part of the arrangement, but the “L” in LBO means the buyer’s borrowing, however they accomplish that.
What if Tesla stock tanks (it could happen) forcing Elon to sell stock to repay his debt incurred to buy Twitter. He could decide to dump Twitter instead in a fire sale, massively undercutting its value and hurting it in the way Yahoo and AOL were hurt by the constant swaps.
In most other countries, such a poison pill would be illegal as it violates the principle of equal treatment of all shareholders. Also, in most other countries, the decision to issue new shares requires a shareholder vote and cannot be done by the board alone.
>I don’t understand how any board can implement a “poison pill”, not just Twitter but Netflix and others, and not be found working against the interest of shareholders. Can anyone help me understand?
So let's say you put in a shareholder rights plan that allows all current shareholders to buy 10 new, discounted shares whenever a new shareholder reaches 20% ownership and for every share they buy from then on. That effectively dilutes that one owner without anyone else, and if they continue to buy it makes all the other shareholders much more money.
That's not always legal, but it would help the interests of shareholders.
> That's not always legal, but it would help the interests of shareholders.
Except the guy at 19.9% trying to move up. Considering he has already invested quite a lot of money on the company, shouldn't the board also work for him ?
Why should he be treated differently and his share give him different "rights" than others people share ?
The poison pill was mostly developed at a time when the alternative was him selling all the company assets and leveraging the company to load it with as much debt as possible then give out as large a dividend as he could before selling off the stock leaving the company insolvent and everyone out of work.
So imagine a company taking $100 million in debt, giving all that out as a dividend then the stock price tanking through quick sales. Poison pill keeps the company going and avoids that fate.
...Companies do not warrant immortality. I fail to see how a corporate vehicle being able to persist against those that have bought in sufficient stake to move policy makes any sense whatsoever.
Today's price and the 'expected' future price is all that matters. The 90% lifetime price history is not relevant. All transactions of this nature are based on future value. The offer is only an 18% premium at a time when many tech stocks are being hammered due to extrinsic reasons. It is not a serious offer.
The share price tells you nothing by itself—you also need to know the amount of shares outstanding at both points in time to make an actual comparison.
That is irrelevant. To show a breach of fiduciary duty with this kind of argument, you would basically have to prove that it is objectively impossible for Twitter stock to be worth more than what Musk offered over some horizon. I very much doubt there has ever been a successful case taking this approach.
To be clear, they haven’t actually rejected the offer yet, they’ve simply limited the ability of Musk to acquire a majority stake in the case that they reject.
Fiduciary duty, such as it is, only extends to dollar value; and there is no other criteria to sue the board over.
Note that I'm all for companies having much more legal responsibility to other stakeholders, not just shareholders, but that is somewhat irrelevant for a discussion of whether the board could be successfully sued over adopting this decision.
True, but the GP's phrasing of "equate dollar values" implies a sort of cut and dried interpretation. A mechanical calculation of a short-term price snapshot is not the only thing that matters. If the board has good reason to believe that Musk will be bad for the stock price in the long-term then there wouldn't be any breach of fiduciary duty.
That's not exactly true, as Musk's offer is to buy the company outright, making it private (and thus buying out all shareholders), as I understand - so there is no concept of how Musk's ownership would affect the stock price. Still, the board can easily argue "we believe shareholders will be able to achieve higher profits in the future by maintaining their ownership than by selling all stock at Musk's offered price today".
He claims that he wants to “retain as many shareholders as is allowed by the law” [0] which is just as fictional as it was when he pretended to try to take Telsa private.
If North Korea offered $60 billion to buy Twitter would Twitter be forced to sell? Not comparing Musk to NK, but money isn't the only consideration when an offer to sell comes in.
Indeed, what happens when Elon starts his own platform instead and uses some of the ~$40 billion he'd otherwise buy Twitter with instead on paying top users of Twitter to exclusively use his platform instead?
He wouldn't bother because it'd be a failure. Twitter's tech stack isn't worth 40 billion, Musk could clone twitter for less than $500m, but just having a platform doesn't accomplish much, the overwhelming majority of twitter users have no reason to leave twitter.
Parler failed because it was never actually able to do and be what the incoming user base thought they were promised —- a free, uncensored bastion. Since that would never work at a bigger size with mainstream attention, there’s no real diff. Parler being a grift makes it all muddied any how.
I'm aware, and do you realize nobody of note is using the alternatives? Why would you recommend someone invest time building a presence in yet another loser platform with bleak future prospects? Doesn't seem helpful or all that bright.
For a real alternative to succeed, solid backers focused on dethroning tw are needed to inspire confidence and stability, then we all need to jump at about the same time to get the momentum going and bounce out of the twatterverse.
Your two comments show you’re the perfect audience and user for an Elon social platform. Every failed or failing Twitter esque platform has some number of perfect audience fits. The problem is that those aren’t enough users. There is no reason to believe an Elon venture would fare markedly better.
The amount of users who once used twitter minus still use twitter is greater than current twitter users. You could build off of everyone rejecting twitter.
Most people who have “rejected” Twitter did not do so because of Twitter issues but wanting micro blogging sort of social platform.
Most rejected the overall concept. The amt of users that stil want something similar but not Twitter AND who will be appeased by whatever alt Twitter is made is an even smaller number.
That only makes sense if everyone who stopped using Twitter is some kind of united cohort. Many people were simply not interested in the format, didn't find content that cared about, didn't have friends using it, drifted off to other social networks etc. Good luck gathering all of these people together on a new platform.
Do you remember Google Plus? Google had excellent financing and an existing team of excellent software developers and couldn't pull of a credible alternative to facebook.
The world is littered with the expensive corpses of failed software.
Much of Facebook could be cloned by many startups see VK.
Google's product lacked purpose. It died because of a lack of vision and leadership and product mistakes (real names).
It died prematurely. Google treated the product like a pilot a network threw on the first week of September. It had solid numbers and given time it could have found itself if it found a backer in leadership.
Twitter has operated for 16 years and public for about 10, explosive growth of their userbase is in their past and monetization strategies have already been implemented for years. There is no reason to believe it has the potential for such growth.
> b: You're absolutely expecting a quick short-term gain
To put this in perspective, 20x in 5 years is an 82% CAGR. And five years is far short of the length of an economic cycle. Traditionally, "long term investing" meant across at least one whole business cycle.
> If I expect Twitter to 20x in the next 5 years why would I want to sell my share to Elon?
Vote with your dollars: buy shares at a price higher than Elon's. Borrow if you must. If you are not ready to take that risk, then maybe your expectations are more wishful thinking than anything real.
And why wouldn't be? He is offering a premium from the current valuation. You either accept it or reject it if you think the premium is low, or am I wrong?
The board’s mandate is to maximize shareholder value. They have an offer that will objectively maximize that value. To scorn it in favor of intangibles is to act against the interest of shareholders.
According to your logic, any offer to go private above market value must be accepted. That's not the case. Stockholders might be interested in owning Twitter stock for a long time. Elon's offer might not make financial sense for them.
No, a board is mandated to act in the best interests of the shareholders. That might be different than just maximizing the share price. They may believe this is a bad idea for the company as a whole, and that long term, it's objectively better for the company to not be owned by Musk.
isn't musks offer to buy out all the shareholders. i.e. lets take a crazy example.
you have a company that is worth $1mil and we only imagine that it can be worth $100mil (based on the size of the market we are addressing). someone comes and offers $200mil but we know he will shut the company down (i.e. liquidate all its assets, or even simply the desire to destroy the company).
While this might be sad for the company, why is it not in the interests of the shareholders to take the offer?
so if Musk is willing to offer more than shareholders expect to see in the forseable future, why does it matter what will happen to the company after that? their interest in the company ends when their shares are purchased.
Musk is trying to buy everyone out because he wants to influence the direction of Twitter. Why not ascribe a similar set of motivations to the other current shareholders? If that is a motivation for them, then shareholder profit is not the only relevant sense of shareholder value.
This isn't an argument for the poison pill clause, but is an answer to the following quoted question. It is funny to see this motivation of most existing shareholders ignored in order to bring into being analogous motivations of another. Especially when Musk's offer for Twitter has been in order to change it promote certain values, but conspicuously, better profits has not been one of those touted values.
> While this might be sad for the company, why is it not in the interests of the shareholders to take the offer?
I will sabotage my own argument somewhat though and say that I believe the economic motive dominates over time and is almost always (in macro and micro) the primary force.
> willing to offer more than shareholders expect to see in the forseable future
That is your assertion/opinion (yes, shared by many, sure). But it's not the only opinion in this case, and so I don't think the analogy holds.
Sure, I could see in the abstract times where an offer it just unavoidably good, and so it would not be in the best interest of shareholders to take it. But in this specific instance, there is a lot to be said on both sides of the offer (taking vs. rejecting it).
I would also argue that, depending on the purpose and goals of the company, knowing that a person intends to shut it down would be a reason to value existing (in order to continue carrying out their purpose) over money.
Sure - if an offer is greater than the conceivable return then of course you take it, but Musk's offer is less than the stock traded at 6 months ago and 30% below the stock's all-time-high from 14 months ago.
It's also not just about $$. In your scenario, it's just negotiating. It's possible the Twitter board and shareholders are just unwilling to ever sell, regardless of the money involved. (I don't know if that'd ever be the case, just that is is possible, and possible within fiduciary responsibilities.)
If someone offered to buy your house at a 25% premium, would you sell? A house is a place to live at, in addition to having a dollar value, and so is Twitter - a powerfool tool to control speech, in addition to its dollar value on the market.
Guaranteed profit at the point in time is great for speculators. If you're doing long term investment, realizing profit at random point in time, isn't really that attractive.
They should, provided transaction fees and gains taxes don’t exceed their estimation of the difference in value times the number of stocks adjusted for the time value of money.
People with more complicated positions should consider covariance and factor in uncertainty. But if you’re a shareholder in a single stock and estimate that it’s overvalued by a significant margin, the rational choice is to sell your position, invest in a low risk, highly liquid asset, and rebuy.
Maybe - it depends on the growth prospects of the company - if they were high anyway - then it is better from a capital gains tax perspective to just continue holding the stock until you need the money.
I'm sorry that sort of argument makes no sense. Anything could happen in the future, but the price today is what the market judges it to be worth.
The historical price is irrelevant as well. Looking at the historical price is the same sort of thinking that leads to "throwing good money after bad".
I'm pretty sure a majority of shares of Twitter care about making the most money ahead of everything else.
But just offering a 50% premium might not be enough. They'll need to pay taxes on the realized gains and they'll need to find other places to put their money.
Recently there have been many accounts getting banned for being critical of US foreign policy in Ukraine conflict, disagreeing with western media propaganda around specific events. Also many got banned for posting "conspiracy theories" around COVID that eventually became conventional wisdom like its origin in the Wuhan Institute of Virology.
If one disagrees with liberal establishment rhetoric on gender issues, you also get banned very quickly. There are a bunch of these consensus political issues that are off limits for debate.
Don’t have one. Let’s go with Trump or Alex Jones. People who say a lot of things people don’t like but aren’t illegal or their illegality hasn’t been proven in court yet.
Instead this is how I’d moderate twitter, when a court orders a tweet to be banned or a judge rules that a user should be banned that is when the moderation team would step in.
I’d also make it easier for people to filter content themselves. So if there’s POVs they don’t want to ever see they don’t have to see it.
Essentially this would reverse 99% of the mod teams decisions.
The interesting thing about Twitter is that people are banned arbitrarily and politically.
Take the case of Megan Murphy, a woman who is in a lawsuit against Twitter. Rules were added to Twitter that were used as a justification for her ban retroactively:
I’d make them publish their content moderation policies, and have all decisions documented and filtered through those public rules.
The speech is made in public and should be adjudicated in public. Today’s Twitter hides its moderation policies and decisions. Even though they are a private company (albeit publicly traded and the effective public square), this is wrong.
The example that people use, would be any speech that legal within the US.
If it is illegal, then most anti-censorship advocates are still fine with it being banned. But generally speaking, the best case scenario for them would be all legal speech in the US.
I'm not the OP but Twitter has at various times suppressed information about covid and covid vaccines. They are well intentioned but they occasionally overreach.
As a quick example, [1] lists some categories of tweets which they will delete. Twitter seems to have overreached with category 2:
> Claims that specific groups or people (or other demographically-identifiable identity) are more or less prone to be infected or to develop adverse symptoms on the basis of their membership in that group;
This is nonsense. Your risk increases with your age. Your risk increases with your BMI. Men are at higher risk than women. Those working in customer-facing roles are at higher risk than those who can work from home. Each of those statements are apparently banned on twitter.
How many people were banned or blocked by Twitter for COVID misinformation, when it turned out that those spreading “misinformation” were actually the CDC, WHO, and government institutions, and when said institutions blatantly lied to the public about masking, vaccines, lab leak theory, and lockdowns, Twitter did absolutely nothing, except punish the people who criticized said institutions.
Not OP but Elon has stated explicitly that all speech legal in the USA, so if I had the choice it would include parties left, right, and center: Occupy Wall Street, the AntiMedia project, Global Revolution Live, President Trump, Milo Yiannopoulus (sp?) Alex Jones, Robert Stacy McCain, Laura Loomer.
What value does a platform have when people are fed up with those who complain about "I want free speech" and leave for greener pastures?
Just look at Facebook. It's widely seen as "boomer garbage" that's only used as a least-common-denominator resort for communication by the target group these days, and conspiracy crap groups and peddlers of propaganda are a huge part of the reason.
Platforms and societies that fail to maintain some basic social order all eventually disintegrate into chaos.
Platforms should be able to censor and ban whoever they want for whatever reason. Any other stance violates the platforms free speech.
If Trump was on the mod team of a platform, I simply wouldn't use that platform.
No one needs to use Twitter. Most people's life wouldn't change the slightest bit if Twitter disappeared tomorrow. There's no serious argument that the platform has a monopoly on anything.
That’s been it though. If the board of Twitter isn’t concerned about what is best for the share folders, a direct violation of their fiduciary responsibility, then what is their interest?
If Twitter isn’t a business to make money to them, what is it, and who is it for?
A parameter in assessing the relative value of the offer to shareholders is the time horizon.
Perhaps the board believes the value of the shares over the next year or two is substantially higher than Musk's offer, such that they should reject the buyout so that shareholders can reap that gain.
Because they are taxed on annual profit, not capital gains. If they sell a stock and buy a different one, there is no profit.
The private analogy is a professional gambler. You don't pay taxes for winnings on each bet. You pay taxes on what you have cashed out at the end of the year.
Tax on individual sales is only a thing for individuals.
The fiduciary duty of the board is to protect the company as an ongoing concern that seeks to increase its enterprise value, and also to protect the interests of shareholders, including minority shareholders.
This is to prevent say a majority shareholder and/or group of employees from raiding the business of its value.
So a case for a poison pill might be well made to prevent a person from taking a controlling stake to then expose the company’s IP (code base) because they have some agenda, or prevent them running the company into the ground by causing a flight of talent, or by breaking some success formula.
I think the answer is that "the interests of shareholders" can be interpreted in a much broader fashion than some people, including board members, like to pretend.
Isn’t it still possible for Musk to make a tender offer which then would have to go to a shareholder vote, or for the board to accept (or put to shareholder vote) the offer he did make? The point of the poison pill is that it prevents a certain type of hostile takeover and you may have reasonable opinions about whether or not such clauses are good/should be allowed, but I don’t think they stop takeovers in general, right?
> The risk portfolio of Vanguard just went up considerably because in the case that they fully lose faith in the board, they no longer have the option of installing a friendly board, they must simply liquidate their holdings. This, in turn, makes them more skeptical of further smaller (non-takeover) investment because it’s more to liquidate and more risk.
It sounds like your interpretation Vanguard's risk profile / likelihood and their interpretation differ. And given that I trust Vanguard's assessment.
Frankly, if I were an institutional investor, I'd probably prefer the poison pill than have Twitter become a toy subject to Elon Musk's random political fight.
Wasn't he all in on Doge coin, except he wasn't, and all in on bitcoin but then not fully, then some other random alt coin, oh and then he's back in on Doge again and how to improve it.
It sounds like sound fiduciary duty to not let your company be subject to those whims.
> Vanguard, for example, has just had its range of further investment limited arbitrarily.
As I understand vanguards structure, they have no beneficial ownership of any company and therefore never trigger the poison pill.
> Who does this benefit besides the board?
This benefits anyone who is concerned that a rich person will buy 50%+1 of a company and use their equity to make decisions they are opposed to. Now if a rich person accumulate 20%, the other shareholders can dilute that rich person. That means the rich person has to convince other shareholders that decision is correct.
"they" if there is such a they, depend far more on social media hypnotizing us and controlling what we perceive and believe. its not the absence of free speech that is the problem, its that truth about our situation cannot make a dent in our psyches while we are hypnotized with a firehose of propaganda and marketing.
I don’t understand how any board can implement a “poison pill”, not just Twitter but Netflix and others, and not be found working against the interest of shareholders. Can anyone help me understand?
You’re categorically changing the profile of the stock. This has a chilling effect on large investors, including but not limited just to Musk, right?
Correct. Hence the term poison pill. Now nobody else will be interested in buying them either and Elon selling out will tank the stock. As a reminder their stock steadily dropped all the way to $14 after the initial IPO pop and they've been losing money since before Covid.
Woke means broke I guess. I think his plan B will be to start a competitor. I'm very tempted to heavily short as soon as he walks away definitively.
As to your question of, won't the other shareholders get mad at the board and potentially sue them - I think the board is drinking their own koolaid.
Poison Pills are rarely exercised, this is a positional move. Unlikely Elon is the only interested party at this point. If the board can use a pill to force a slower buy-out discussion and negotiation it is very much beneficial to shareholders.
Their stock price was over $70 in the trailing 12 months.
Even with Elon's offer they are still worth 10 NFL teams combined.
I can find zero credible evidence to support your position. Please short the stock :)
I wasn't aware NFL teams was a unit of measurement. One has to wonder if you think I am wrong why you wish for me to short the stock and lose my shirt.
a) The poison pill only affects those who are looking to control the company in some way. Which isn't most large investors at all. So I doubt you will find any who will be concerned by this.
b) Twitter's stock price is now $45, peaked at $77 only last year and is profitable. Not sure where you get this ridiculous idea the company is unsellable.
c) There are plenty of free speech competitors to Twitter. None are even remotely successful. Because as Reddit also showed far more people want a moderated experience more than those that don't. And Twitter is a business first and foremost.
d) Musk is offering shareholders a premium as the stock is today. But as I mentioned even just last year it was significantly higher. And so I can't imagine shareholders would have an issue about them turning it down if they believed Twitter was still continuing to head in the right direction as it is now.
>The poison pill only affects those who are looking to control the company in some way. Which isn't most large investors at all. So I doubt you will find any who will be concerned by this.
That's not the right way to think about it. Anything that scares off ambitious, optimistic activists from buying big stakes, will then suppress the stock value in general, which hurts all shareholders, including the smaller ones.
More broadly, going public is a tradeoff. You potentially give up control to outsiders, in return for greater share value (and the cash infusion). Moves like this go the opposite direction: decrease the potential for outside control, and with it, the upward pressure on the stock's value.
> I think his plan B will be to start a competitor
I hope it isnt: I think that starting a top down, meaning "look I built this, everyone move over from twitter", competitor has a very low probability of success, regardless of who starts it. There is too much of an attack surface, there will be too much drama on real Twitter about it, early adopters will be gun nuts or some other out group and that will be how they get characterized, etc etc.
The real chance at a competitor would be something that grew organically, that people wanted to move to because it offered something valuable before it reaches scale. This is how actual businesses start. The top down approach is how massive flops happen.
Incidentally, the same holds true for the Facebook metaverse and imo suggests it will certainly fail
Remember that this IS Musk; not very predictable. But I'm going to try...
Since Musk has stated that this was NOT to make money, I imagine that triggering the poison pill, and THEN dumping the shares would tank the stock. Musk did say "final offer, and if rejected, re-evaluate". The poison pill trigger? Not something talked about.
I hold some shares of TWTR, and would continue. For the lulz.
You're probably right. On the other hand he is one of their biggest users and has a lot of celebrity friends.
There's too much drama on real twitter about it anyway. They might be stupid enough to ban him too soon, and if they keep on doing that nobody will want to use it. A lot of the top users haven't tweeted in over a year.
He can buy one of those other competitors used by right-wing folks. Hell, if "free speech" is so important to him and to everyone else he wants to rescue he can just tweet to use those other platforms. It's certainly cheaper.
Spoiler alert: other platforms are not in any way more "free speech". Gab for example bans porn, which is both free speech protected by the First Amendment, and allowed on Twitter. TRUTH Social seems to forbid a lot of things, such as depictions of violence, lewd content, libelous/slanderous content and lying (true to their name, I guess?).
Twitter is "losing hundreds of millions of dollars every year" (I don't know if that's how we're using air quotes now, just following your lead), it is already circling the drain. No need to buy anything, it would be trivial for him to setup a clone and fund it indefinitely while it tears itself apart.
Twitter is where the network effect and users are, so no it makes more sense to take over Twitter and shape it to your own views if you are a billionaire who wants to make an impact on public discourse and free speech.
That sentence alone means you weren't even discussing this in good faith.
It's very well possible that the Twitter board believes that they can achieve higher value for the shareholders than what Elon offered. It's also very well possible that after talking to Elon through private conversations that you were not part of, they fundamentally disagree with his value and the direction he wants to take the company.
>I think his plan B will be to start a competitor.
Hey, maybe he would buy Parler, that would sure get him all the attention he desperately craves for. /s but maybe not.
> That sentence alone means you weren't even discussing this in good faith.
Is that what good faith means now? Being religiously part of Camp A or B?
The balance sheet speaks for itself. Incidentally Parler or his potential Twitter clone will also end up a toxic internet community. Who cares? I personally wouldn't use either one.
Certainly with Twitter already doing a great job losing money and alienating most people (almost nobody actually tweets and usage is falling) an alternative would split the user base and accelerate their demise and the inane concept of web micro-forums being worth tens of billions of dollars. Companies will simply decide advertising on Parler/Twitter is not worth the hassle.
>Is that what good faith means now? Being religiously part of Camp A or B?
No. But you immediately made this into a Camp A vs. Camp B problem when in reality there could be a million different reasons for the Twitter board to not want to get acquired means you weren't trying to discuss this specific situation, you were looking to turn this into a debate on "wokeness". That's why I said you weren't discussing in good faith.
>The balance sheet speaks for itself.
Does it? Elon has seen the same balance sheet and he thinks the true value of the company is higher than what it is now as well. So obviously he thinks Twitter has the potential to achieve much higher value through implementing XYZ. The board agrees too but just disagree on what that XYZ is.
> Elon has seen the same balance sheet and he thinks the true value of the company is higher than what it is now as well.
Up to you to take him at his word however he has stated otherwise.
"It's important to the function of democracy, it's important to the function of the united states as a free country and on many other countries and actually to help freedom in the world more broadly than the US.
You know I think this there's the risk, civilizational risk, uh is decreased if twitter, the more we can increase the trust of twitter as a public platform and so I do think this will be somewhat painful and I'm not sure that I will actually be able to to acquire it.
I mean I could technically afford it um what I'm saying is this is not a way to sort of make money you know..
It's just that I think, my strong intuitive sense is that having a public platform that is maximally trusted and broadly inclusive is extremely important to the future of civilization"
His net worth is over a quarter trillion dollars. Flipping twitter for profit is very far from a sure thing and seems like a waste of his time.
Why out of everything that he could invest in would he bother with twitter specifically? Whatever his intentions are it seems plausible that this isn't about money.
I get that you don't like him but this attitude of "I am right, you are wrong, and if you disagree you are drunk" is.. not a good look.
>Whatever his intentions are it seems plausible that this isn't about money.
It's very plausible that this isn't about money, and I never said it's about money. However it's far more plausible that this is about a narcissist buying media and social influence and he wants to be able to shape public discourse that paints him in a positive light. He really cares what people thinks of him.
All of that would seem far more likely (and suits his past track record) than him doing this to "save democracy".
> Elon has seen the same balance sheet and he thinks the true value of the company is higher than what it is now as well.
Also I'm pretty sure a narcissist is exactly the sort of person to genuinely think he is saving democracy by buying a website.
Do you know him personally? Are you a trained psychiatrist? Narcissistic personality disorder can be a serious affliction, tell him I hope he gets the help he needs and that I wish him the best.
I personally just want to know what will happen to the stock.
He is already an influencer and owning a social network where he gets to set his own rules would be the best way to ensure his influence increases further.
Free speech on social media is an oxymoron. SM is designed to give you power in proportion to the number of connections you hold. Its a popularity contest of twisted, faked, carefully crafted viral thought - most real, true and meaningful things get lost in the sea of professional influencers.
You will find more real free speech with a single visit of a subreddit than you will within a week of being on social media.
elon wants to save us from woke people, and sees that this is a trillion dollar opportunity.
have you seen the matrix? they powered a cluster the size of the planet using humans for batteries! this is the same scale problem, that and pedophilia.
> Elon has seen the same balance sheet and he thinks the true value of the company is higher than what it is now as well. So obviously he thinks Twitter has the potential to achieve much higher value through implementing XYZ. The board agrees too but just disagree on what that XYZ is.
Yes, but one version of XYZ (the board's) has been tried while the other (Elon's) has not. Elon's plan might lead to even worse results than the board's, but he doesn't think it would, hence his optimism if they adopt his plan.
> c) Profit of $273m in 2021 when you exclude once-off litigation expense.
The once-off litigation expense might soon be recuring in 2022, after this move. The former was a shareholder class action lawsuit, and the latter will most likely be the same.
> It's very well possible that the Twitter board believes that they can achieve higher value for the shareholders than what Elon offered
Who would believe that? They’ve had years to prove it and as they stock market has doubled in value their stock has been cut in half.
Share holders should sue. It’s time to trick their world and either drive the stock price to a few bucks or force then board to do their fiduciary responsibility and sell the company.
All of this is possible, but the reality is: Twitter is a 16 year old company that has changed imperceptibly since its inception. Elon has several polls over the past month, voted on by literally over 3M people, vehemently disagreeing with some of the policies Twitter holds dear. Their revenue is flat and down. They literally had a chokehold on global politics during the Trump era, and did nothing with it toward building a better business, or even a better social network.
Their board can believe all they want. But they're failing, miserably. Elon isn't perfect, but at least he doesn't have a demonstrated history of driving his companies' value into the basement, like Twitter's leadership does. This move by their board serves no-one but them; it doesn't serve Twitter's users, it doesn't serve their customers (advertisers), it doesn't even serve the vast majority of shareholders (which will be evidenced by an unprecedented sell-off on Monday).
Goldman advised them to block the purchase, because $52/share was too high, while simultaneously holding a $30 sell benchmark on TWTR. Its not even ironic that this is where Twitter's stock is going; its what they predicted, and then caused. The idiots in the room are the Twitter board, who actually believed the advice was given in good faith.
This makes me wary of your post. You could have easily fact checked this and you would have seen that this is incorrect. It's up 37% compared to the year before that. [0] I checked the last 3 years and the growth has been positive during all 3 years. [1]
> Elon has several polls over the past month, voted on by literally over 3M people,
Oh sh*t i don't follow him and didn't care about those votes ... should I write a bot to make my voice heard? Is that how it goes? (Or in other words: such a vote has no statistical significance aside from pleasing Musk's ego or whatever is driving him and his need for attention)
Not having value is a value in itself. It takes a crazy amount of effort to be completely neutral.
>that my communication-medium
Twitter is first and foremost a publishing platform, you should not rely on it as a private communication medium. None of the chat apps I know censor stuff, so use them instead.
Use Twitter for public communication if you want, but since it's in the public domain you can't complain too much if there is content moderation.
> Not having value is a value in itself. It takes a crazy amount of effort to be completely neutral.
The phone company does a pretty good job of it, and we have regulations that force them to be mostly "neutral".
Those regulations have worked out quite well. Perhaps it time to expand our existing, and working regulations to other platforms, given that they work so well on existing platforms.
I dunno man. My email software seems to accomplish that feat quite easily.
Sure I can complain. When it's the defacto public forum any administrative conversation-tweaking is pure poison to our society.
And also, yes, there is an implicit promise that the conversation between you and me is not getting fucked with by an invisible rat in the middle. So when I smell one of those rats, heck yes I'll complain. That's objectively ratty.
This implies American culture is pro-fascism, and while there are elements of that I don't believe that encapsulates American ideas - the gamut of ideologies have been part of the nation since its founding, though the ideas and what that means have shifted over time
It isn't just the shareholders they have a fiduciary duty to: they also have the duty of care, the duty of loyalty, and the duty of good faith. Selling to an adderall-addled toddler just because he happens to have accumulated more money than any person should have could be argued to violate all three.
They're doing it on purpose so people will sell off TWTR, then they will secretly buy and approve the acquisition offer. It's a blatant insider trading scheme.
> and not be found working against the interest of shareholders.
It depends on what the interests of the shareholders actually is. Monetary only, or are there other considerations they care about?
I assume the boards of such companies have had private discussions with the majority shareholders to find out exactly what their priorities are, and then acted accordingly.
Twitter is not a B-Corp indeed. However any company, not just B-Corps, can have a purpose other than shareholders value maximization. Check this article: https://doi.org/10.1111/joms.12660
>any company, not just B-Corps, can have a purpose other than shareholders value maximization.
It's moving there but I don't think it's there quite yet according to case law. The board motivations at present still have to tie back to maximizing value for shareholders.
Every company I know of that did a poison pill to prevent a takeover wound up tanking within a year or two and the shareholders wound up with sand.
As a Twitter shareholder myself, the board is making a big mistake.
As a legal matter, I don't understand how a board could sell shares to other shareholders at a lower price than to the entity wanting to buy shares to gain control.
Icahn was claiming that Netflix was undervalued. To be fair, he was also angling for an acquisition. But a bid like that usually has a half-life; the market trends to a good price — and indeed, Netflix doubled in value by mid-2013.
Elon is arguing that Twitter is mismanaged. He already probably pushed them on the edit button, even though they claimed he didn't. If he's right — and Goldman Sachs seems to agree — he could have an easier go of it next year.
> It is because at Certain Times, given Certain Circumstances, humans will Behave Badly when confronted with Certain Ideas, and if you are The Main Platform Where That Idea is Being Discussed, you cannot do NOTHING, because otherwise humans will continue behaving badly.
To paraphrase: "Ideas are dangerous, people cannot be trusted to argue on the internet because it leads to violence, therefore people have to be censored, even if the things they're saying are true".
First, the idea that lab-leak theory was related to violence against East Asians is highly, highly dubious. Second, again and again, I see people arguing that we have to dispense with our ideals because they are Too Dangerous. At some point you have to realize that these people are just cowards.
> I see people arguing that we have to dispense with our ideals because they are Too Dangerous. At some point you have to realize that these people are just cowards.
We don’t have to dispense with the ideal. But that’s what it is, an ideal. We have to remain pragmatic.
It is both funny and sad that this country made it through a revolution, a civil war, various recessions, two world wars, the looming threat of nuclear holocaust, decades of ill-advised military adventurism but apparently it's "people arguing on the internet" that causes us to stop believing in free speech. Like I said, cowards.
Bullshit. We did just fine, and the populace did just fine ignoring the quacks, just like we'll ignore all the quacks without tech companies censoring everyone. Lord above, we might come to terms with the fact we're all nuts, which would be a far more productive and unifying form of civil discourse.
it's not that we stopped believing in free speech, it's just that, like many other words and terms, "free speech" has been "Newspeaked", redefined before our very eyes, in our very lifetimes, and all they had to do to accomplish it was put the Internet in everyone's pocket and convince them it will brainwash them into being evil mindless automatons or something, unless The Right People oversee and moderate what can and cannot be discussed online. literally nobody thought this way 15 years ago.
More precisely: ideas are powerful, which means they can be dangerous.
Anyone who doesn't understand that is actually a deeper enemy of discourse than a platform owner who says their forum is not a venue for topic X or opinion Y.
Some stop here at a dichotomy: "you want to ban ideas, I will be oppressed!" or "I must literally be allowed to put my words in your speech vehicle and be given full access to its audience without any abrogation of that privilege or I am being oppressed!"
Others start to understand what the legal system has with both weapons and speech: perhaps there are some activities or forms it takes that need nuanced consideration. Time, place, manner, associated behavior, fire in a crowded theater, threats, etc. You will find these considerations where people actually take speech seriously.
> Ideas are dangerous, people cannot be trusted to argue on the internet because it leads to violence
You seem to be merely summarizing with scorn here rather than actually addressing the situations where this happens.
It's not hard to find stories where distorted worldviews oriented around agentive threats regarding the pandemic have led to people threatening and even assaulting health professionals. I know some of these people.
You probably know families or acquaintances that have banned certain topics from dinner gatherings because they lead to heated conversations or even violence. It's not that they believe no one should ever talk about them. It's that they understand what Wong is talking about here: there's problem behavior and carving out a domain where the related topic isn't carried is one way of fixing it.
And when it's your house that people are yelling or coming to blows at, I'll bet you try the same solution.
Arguing on "the internet" is a freedom that has never been threatened by limitation that Twitter and Reddit have put in place. What's at stake with Twitter and Reddit is what Wong describes well here: they're stewards of the platform where this is taking place, they get to see the effects. They feel an obligation to do something about it.
And you know what? Their right to do so as stewards of the platform is also a freedom of speech right. And it's every bit as important as an individual's right to spout off about whatever it is they want.
The freedoms to watch more strictly are those where the state or other entities impose violence or loss of physical freedom as a consequence for touching a topic. Twitter and Reddit battles are about people's sense of privilege.
You sir, are ascribing nuance where there is none.
Moderation's place is at the end agent. Period. I.e. it is the responsibility of people and end users to be aware of the actual physical world we share with others. To distort it is to do injustice to everyone.
I assure you. The poisoning of reality for "people's own good" leads to slippery slopes, and complete dysfunction and fraying around the edges which will always start targeted against undesirables, then be weaponized against everyone else by whomever happens to be in a position of power.
Either accept the world unfiltered, or don't try. Half efforts are doomed to abuse.
In your long, meandering post that reminds me of the long, meandering thread you linked, you claim that anyone who supports free speech is "actually a deeper enemy of discourse" than a censor. That's creepy Orwellian nonsense and anyone "smart" enough to convince themselves that up is down should not be making decisions.
This actually isn't hard. Ban racial slurs, "doxxing," calls to genocide, and low effort provocations. Don't ban ideas because you're convinced they are wrong or dangerous.
> you claim that anyone who supports free speech is "actually a deeper enemy of discourse" than a censor
Not what I said. If you care about speech, try to be careful about parsing, interpreting, and summarizing it. If something still doesn't make sense, try asking questions.
It's exactly what you said. I took your dissembling and accurately reproduced its message in one sentence.
> More precisely: ideas are powerful, which means they can be dangerous.
> Anyone who doesn't understand that is actually a deeper enemy of discourse than a platform owner who says their forum is not a venue for topic X or opinion Y.
In order to have REAL FREE SPEECH (which you call DISCOURSE) we have to CENSOR BAD OPINIONS.
No. Stop playing whack-a-mole with "bad ideas". "X idea leads to Y bad thing" is almost always wrong, the world is chaotic, no one knows the result of a tweet, and people who claim to are just looking for excuse to shut down debates they're afraid to have.
> Ban racial slurs, "doxxing," calls to genocide, and low effort provocations.
Hey everyone, look here! We have the answer to the thorny issue of what governs free speech in clear black and white. Twitter, facebook, reddit execs, take note!
No, "low effort provocations" has nothing to do with "disinformation" or "spreading knowable lies". I am genuinly astonished that you think all those things are synonyms.
news.ycombinator.com does this right -- moderators rarely moderate based on the message or idea in a post and their opinion about its truth-value. Rather, posts are moderated for being provocative, overly rude, including slurs, low effort, and so on.
I'm making the point that deliberate misinformation is provocation. Claims without evidence, baseless contrarian assertions with no semblance of logic, is provocation. Posting snarky one-liner "rebuttals" to a paragraphs-long post is provocation.
Not all of those things deserve the same level of reaction, but they are a disservice to useful conversation and should be moderated/downvoted accordingly.
I agree that HN does it correctly, so I wonder where our disconnect is.
No I didn't. The twitter thread we're talking about used "lab leak" as an example of something that had to be censored but the author also admitted he thinks the lab leak hypothesis is true. Something that was true had to be censored! (I don't think lab leak is true, I'd give it a ~30% vs ~70% for zoonotic).
I don't care about trolling, it's just a neologism for "making a joke" or "taking the piss". "Bad faith" and "disinformation" are words used by people who want to shut down certain debates.
That's only from a content moderation point of view. I would argue Twitter is incredibly mismanaged from a product POV. Barely any new features, buff Android app (at least for me), and Twitter Blue being pretty useless.
I mean, if you take it as a case for why moderation is hard, that's fair. But while Elon describes himself (identity politics) as a "free speech absolutist", his concrete proposals seem to include things like an edit button, long-form tweets and some monetization strategies.
I think the fairer critique of modern Twitter is that it prioritizes the needs of media personalities and PR firms over ordinary users, not that it isn't "free" enough. I am blandly optimistic about the prospects of things being shaken up at Twitter, and for who Elon is, it could easily be someone much worse.
It's very clever. It redirects of a raft of points Wong makes into a narrative Musk is pushing. It probably represents one of the reasons why he's so successful. :)
It also loses its luster on a bit of reflection -- this particular novella was in fact published on Twitter, and obviously got plenty of attention, including from Musk, so it's not exactly clear that Twitter's an unacceptable venue for novellas. Also, there's other long-form platforms that don't seem to have competed well with Twitter so far.
But maybe someone could pull off making such a thing work. Which is why personally what I'd like to see Musk do is take the assets he was going to use to purchase Twitter and build another platform, one with the features and values he's envisioning from the ground up. He might have the juice to pull it off, and it would help diversify the media landscape and discourse culture rather than just being a tug-of-war.
Isn't your sample biased? Distressed companies are more likely to attract takeover attempts (hostile or not) compared to healthy ones; and they are also more likely to tank. As far as I can tell, Twitter is not in financial distress.
Not really, as a counter argument, there is every reason to believe that Musk will make a mockery of twitter and run it into the ground. A social media platform with a lot of responsibility is not for someone as egotistical as Musk. If Zuckerberg is bad, Musk could be catastrophic.
Elon has run several companies immensely more successful than Twitter. He also planned to address some glaring issues on the platform. There is almost no question he would have been better than current management, which is destroying their platform.
I don't think it's run like a public utility. Twitter takes stances that might seem 'centrist' in politically blue areas, but seem biased in red areas.
Personally, I think Musk would run it more fairly.
That need not be what the board wants and long term shareholders want. This pressure to accept an offer is for institutional (hedge funds) and short term investors. This thought process is similar to when the company decides to invest in the business at the expense of stock buy backs for example, the way Bezos ran Amazon for a long time.
I'll let you in on a secret: every person who runs a company is egotistical. It's not possible to run a company otherwise. You've got to have confidence in yourself and your ideas.
Of course, some hide it more assiduously than others. I don't mind Musk boasting. He earned it. It's more refreshing than the fake modesty of others.
A CEO friend of mind once called me up all worried because someone called him arrogant. I told him of course you're arrogant. He was shocked. I laughed, and told him to look at his accomplishments - who but an arrogant person would ever have even attempted those things!
Egotistical is quite different to confident. Narcissistic and egotistical people often have a fragile self-image. Prone to destructive rage[1] with the slightest insult.
[1] like calling someone a paedophile without any evidence.
It’s a completely ridiculous narrative to think that musk is interested in anyones free speech but his own. We should all be more aware of when the narratives billionaires pitch about themselves become perceived to be objective reality.
While I don't dispute that Elon is first in Elon's mind, I (perhaps in ignorance) have no reason to believe that he wouldn't take a principled stance and apply the standard he wants for himself to all. That's certainly what he's claimed.
I don't find the assertion that billionaires inherently lack integrity a compelling argument. In the spirit of honest inquiry, do you know of any reason specific to Elon that I should not take him at his word?
Because it takes a particular kind of person to become that rich and wealthy. When the whole Epstein scandle unraveled, it was eye-opening to me that all these people intent on being wealthy, powerful and influential, were also morally dubious. Elon has clearly sought wealth and power throughout his life. Twitter is the most influential social network on the planet - maybe he thinks that he could transition from the richest person in the world, to the most powerful.
It’s important to note I didn’t say anything about his integrity.
There’s a pretty significant area of scholarly research in business and entrepreneurship that criticizes “mythicization” of successful individuals.
What those scholars argue, basically, is that media as well as business researchers take the words of successful people as inherently true and important. The result in, say research on entrepreneurs, is that what successful entrepreneurs think is meaningful is reported as de facto true and important. The critique is not of them saying it - it’s of others accepting it as valid based on the heuristic that successful people must be right. It’s a critique of the resulting research for not being objectively defensible, but instead just reinforcing societal norms as reality.
In my comment, my criticism isn’t of musk it’s of others. Believe me, musk, you, me, everyone tells stories about our selves and our beliefs from our own perspectives. It’s how other evaluate and use those stories as objective rather than subjective that can be problematic.
If Elon was really only concerned by his own free speech he could easily using the small change in his pocket to create elonmusksays.com, have 10 people run it, and his daily quips and insights would be there for all to see and presumably quoted anywhere and everywhere.
Elon always has bigger plans and ability to execute on them then people seem to acknowledge.
Even if you think Twitter stock will go up 20% next year, you'd want to take this offer. If you think it will go up 50% next year, you might still take the offer because of the risk:reward ratio.
Yeah, I don't know much about TA, but I think it probably works better for well-established cyclical stocks, not for growth (or lack thereof) stocks like TWTR.
I think last year was some serious bubbliciousness, not the true value of Twitter and all the other tech companies (and shitcoins and NFTs and basically everything else people were throwing money at)
"Elon said" is not a stamp of trust anymore. Elon also said TSLA would accept Dogecoin, which he had accumulated prior to communicating it. Then he sold it off.
History should be a lesson here, it's almost Deja Vu with Twitter
The big reason it tanked was privacy regulations from Apple/Android. That's not changing to favor Twitter and effectively took away one of their biggest revenue streams. That's a big deal for a perennially non-profitable company.
Read some Matt Levine, he's way more articulate and makes finance quite fun. But if I were to take a stab at it:
The market has been so weird recently that stock splits - which according to previous theoretical belief do not create shareholder value - have in fact increased the share price for extended periods. So issuing stock for whatever reason (high price, poison pill) could be seen as shareholder maximizing.
One could say diluting the stock so that a particular personality cannot buy the whole company could be shareholder maximizing as it would entrench ESG held values -- emboldening new shareholders to purchase the stock (saving the stock price).
And point of information, by diluting rather than selling already owned shares, control is not ceded to the potential acquirer -- unless the potential acquirer doesn't care about the poison pill and will pay the premium for the new issue as well.
> The market has been so weird recently that stock splits - which according to previous theoretical belief do not create shareholder value - have in fact increased the share price for extended periods
You're right that theoretically, they shouldn't create value, but I think even back to the 80s and 90s it's been shown that companies that go through a split tend to out perform the market for years after the split. The main reason isn't that the split creates value, but rather that companies who go though a stock split are usually successful and already on a trajectory to beat the market, split or not.
I think it still is. I'm going to try to find a source, but I saw an analysis where they measured from a year before the split, the day the split was announced, and the day the split was executed all until one year after the split was executed and the returns on all of them beat the market as a whole.
That being said, holding before the announcement performed the best.
> I'm going to try to find a source, but I saw an analysis where they measured from a year before the split,
There's a bit of time travel / survivor bias with this one. A company that has not beaten the market is much less likely to split its stock. In other words, if I know nothing other than that a company is splitting its stock, I can reasonably guess that it's shown good returns in recent history.
IMO, Matt Levine is mostly writing with his tongue firmly in his cheek when he suggests stock splits and meme stock antics are Rational Things Boards Should Do For Value.
Excellent source for financial news though, I agree!
Stock splitting isn't dilution. It is the equivalent of breaking a $10 bill into 2 $5 dollar bills. Dilution is just printing more $10 bills aka inflation.
This POV needs to shove it, because even those institutions can have their resources revoked by people waking up and accepting capital allocation is their responsibility.
This is the toxicity that has younger people rightfully angry at how the system works, and how it is "rigged". People just haven't had the info bandwidth previously to even contemplate these problems.
So no. WalterBright should absolutely do with his shares as he wilt, as should everyone else. Frankly, I wish institutional investment was deconstructed to at least get people coordinating with each other from the ground up to accept what it is their institution's manager was actually perpetuating.
Institutional investors are the backbone of municipal bonds that help small towns borrow and build. They back all of the retirement vehicles in the U.S.
They give a financial stability to places that need them.
One of the reasons Twitter is stable is because of those types of investors and is not subject to the whims of individual shareholders.
No corporate leadership wants to be subject to the whims of the stock market if they can avoid it. Twitters board and its institutional investors the firewall against such things.
Did I give the impression anyone would? I pointed out that I have a financial stake in Twitter in order to show that I have skin in the game that contributes to my pontifications on the topic. I'm not merely a disinterested observer.
I'm not. Though I wouldn't have been too upset to pocket a 20+% gain, I bought at the start of 2022, bolstered by Jack's ouster. They need to figure out a paid tier for celebrity accounts, cut the fat from the staff (it's really not that complex a piece of software relatively speaking), and get profitable. Scott Galloway saw the potential well before Musk got involved.
The idea that the board's fiduciary means they must maximize profits at the expense of all else is a bit of a myth. Yes, they need to look out for their shareholders but they also need to do right by the company, and companies can be formed for any legal purpose and everyone (the company and the shareholders) values things differently. It's generally been upheld that the board has a lot of autonomy and, outside of gross negligence, is generally protected by the business judgement rule.
Under DE law, my understanding is that you are slightly off on this.
Boards do have a duty to maximize shareholder value. THAT SAID, the business judgement rule provides that judges will not second guess the board absent evidence of gross negligence or total disregard of duty. This is because the Delaware court has decided that judges are not better than boards at evaluating business decisions.
BUT! Overcoming the BJR is very difficult unless management stupidly says the quiet part out loud.
Dodge v. Ford is a celebrated case in this regard because Ford basically said at trial "Yeah my main consideration in taking [specific action] is not maximizing shareholder value" and the judge was like "Haha no, that's not how any of this works - you can't do [specific thing] now." But if Ford was like "Yeah [specific thing] would be GREAT for shareholders" under the BJR the judge would have been like "Okay, great, keep doing what you are doing. How could I possibly know better than you?"
Also there is no "need to do right by the company" - squeezing value out of the company and all of its stakeholders is completely consistent with the duties of the board members. How else would the private equity industry exist? (jk!)
I said this below but I don't think Dodge v. Ford is particularly really plays much into modern case law outside of the judgement rule. To my knowledge, it's never been cited in Delaware (against the board at least).
A case that stands out more to me (being both more modern as well as at the federal level) is Burwell v. Hobby Lobby: "While it is certainly true that a central objective of for-profit corporations is to make money, modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not do so." in reference to furthering religious goals instead of profit. (https://supreme.justia.com/cases/federal/us/573/682/#tab-opi...)
I hear what you are saying. Hobby Lobby is an important case but to me Hobby Lobby doesn't really implicate the same policy concerns. Hobby Lobby was a closely held (read family held) private corporation. I agree that the language is dramatic, but I don't really think it the case has much to say about the duty to maximize shareholder value in widely held or public companies.
I read that quote from Hobby Lobby as saying "Sure, where you own the whole thing you can do what you want, whatever, it's not like you are hurting any other shareholders" but I would hesitate in relying on getting that type of language in other fact patterns.
Note that the plaintiff in Hobby Lobby was the secretary health - not a disgruntled shareholder.
Right, though I don't think it is so vague as to be meaningless. The stakeholder / shareholder value debates in corporate governance play on the extremities of this distinction a lot, with the current koan being that what is good for stakeholders is good for shareholders.
It's not, particularly in the context of takeover defenses. There were cases in the 80s where Delaware ruled that only shareholder interests--not all stakeholders'--can be considered when a Board uses its "business judgment" to deploy a poison pill. But shareholders can have aims other than maximizing profit, and companies are free to respond to them.
Right, though it is an interesting question of whether those values either have to be (1) directly fiducial (2) couched in some theory of fiducial return or (3) can be entirely non-fiducial. Doesn't really mean much in practice because management can always just cover their ass by saying that the other aims are also good for the bottom line - even if it is nonsense.
> Yes, they need to look out for their shareholders but they also need to do right by the company, and companies can be formed for any legal purpose and everyone (the company and the shareholders) values things differently
The board has a lot of leeway into how they achieve profit for the shareholders, but all decisions they make must be nominally in the interest of that goal (assuming we're discussing a for-profit company such as Twitter). They can basically claim anything they do is done in the interest of shareholder value and be safe, but if they said "we know the company will lose money on this, but we really like X so we'll spend company money on it", they would pretty clearly be in breach of their fiduciary duty.
At least in Delaware law, a board's fiduciary duty involves a duty of care, loyalty, and good faith. While acting to maximize their personal interests or egregiously working against profits could be considered a breach, not trying to maximally make profits probably wouldn't be.
All of this would need to be litigated on a case-by-case basis, but many modern cases have found that companies can freely act to maximize the wages of their employees at the expense of dividends or act charitably even when there aren't tax breaks.
That said, I'm not sure this really even applies in the case of Twitter---I think its not unreasonable to argue that the innate value of Twitter is so much higher than what Musk is offering that its better for the shareholders to wait even thinking purely in terms of profits (I would probably personally disagree with that, but I don't think its any more unreasonable than plenty of other valuations I see)
Yes, they don't have to maximize profits, but they also can't ignore profit to the benefit of other values they deem more important, per the very old but still in force Dodge v Ford.
As long as they are not egregiously and obviously acting against that goal, or taking decisions without deliberation, the law would favor them in any trial that only hinged on whether the price offered by Musk was better than the market. Basically the burden of proof to show that it could not have been a good business decision would lie with the plaintiff, and I very much doubt that you could build a solid case of that.
I mean, saying "We are concerned about a hostile takeover attempt by a person who isn't allowed to be an officer of a public company anymore because he has show himself either unwilling or unable to be a fiduciary for stockholders, and we are trying to protect our stockholders from him" seems like a slam dunk in court.
Musk is offering to buy out all stockholders, so if the sale goes through, he will be the sole owner of Twitter, and all current stock holders will receive cash.
On the other hand, the board can easily say "we don't beleive this deal offered by a person who isn't allowed to be a public officer of a company anymore will ever go through, either because he will retract it or because he will be unable to secure funding; and we beleive attempting the deal will hurt stock prices and profits for current shareholders" and then I agree, it would probably be a slam dunk in court.
I don't think Dodge v. Ford isn't a great case to cite here for two reasons:
1) I think the trend of accepting that corporations can exist for reasons other than to generate profit is a post-ww2 phenomenon and this case is from 1919
2) Perhaps more importantly, Dodge v. Ford was a case before the Michigan Supreme Court and, to my knowledge, has never been used in a case in Delaware.
We are the largest perennially unprofitable company to ever exist. The richest guy in the world offered to invest a fifth of his net worth into the gamble of turning our company profitable while making our shareholders a massive profit.
Instead, we poisoned the system knowing that the stock is all but guaranteed to tank massively reducing our market cap and hurting our ability to take out still more loans to continue our unprofitable venture.
But we're holding true to our other nebulous values.
To prove a breach of fiduciary duty, you generally have a very high burden of evidence, unless you can show some conflict of interest or obvious lack of deliberation.
Otherwise, the business judgement rule is applied, where the presumption is that the directors acted in good faith, and you would essentially have to prove that it is impossible for Twitter stock to grow beyond the current offer.
What answer could they give for their actions that isn't immediately disprovable garbage?
Do you really think that discovery would show that this was all in good faith?
I'd bet heavily that a lot of ideological discussions would be disclosed. As that is completely contradictory to what Twitter claims is their goal, bad faith would be the only remaining option.
I would bet that no such ideological grounds would be found in discovery, even if it were true, unless the board are complete morons to discuss such things over email.
Instead, it is easy to expect they would discuss the sincerity of Musk's offer (the chance that they may accept it only for it to be retracted, as happened with the board membership offer), the plausibility of him having the required financing, the stock price today vs 6 months ago compared to the offer, and similar business discussions.
I also don't personally believe this is an ideological battle at all - it's much more likely to be a financial manouever or simple ego-driven ambition by Musk.
You gave a very clear example of a breach. To add to your point, Elon's offer is both conditional on financing and too low, so we will implement a poison pill would never be seen as a breach.
A for-profit company is there for profit. There is no other way to interpret shareholder value in a for-profit company, for purposes of discussing fiduciary duty.
Now, providing profit/share-holder value need not mean maximizing said profit - it just means that profit must always be considered in any business decision, it can never be entirely ignored in favor of other things.
Note that not even shareholders get to decide what kind of value they expect their board to offer them. That definition of value is set in stone by the type of corporation. The board of a for-profit company has a fiduciary duty to the shareholders of the company as pertains to profits.
If 100% of the shareholders of Twitter voted to ask the board to sacrifice profit for free speech; and the board decided to ignore this request entirely and publicly announced they would limit free speech at every trun to focus on profits, the shareholders would have no chance of winning a breach of fiduciary duty trial against the board. The board has no legal duty to uphold some abstract values that shareholders hold dear, they only have a legal duty to act in the interest of company profit as they see fit.
> it just means that profit must always be considered in any business decision, it can never be entirely ignored in favor of other things.
The word "entirely" is doing a lot of work there.
> The board of a for-profit company has a fiduciary duty to the shareholders of the company as pertains to profits.
This is a dramatic oversimplification that borders on falsehood, as you noted yourself in your previous paragraph. As a trivial example, the board would be entirely entitled to claim that their goal is very long term profit maximization, and that this will result in decades of losses (effectively Amazon's strategy).
We also now have "Public Benefit Corporation" as a codification of a for-profit corporation that does not have profit as its primary motivation (at least in 35 states & DC), but obviously that does not apply in the case of Twitter.
> As a trivial example, the board would be entirely entitled to claim that their goal is very long term profit maximization, and that this will result in decades of losses (effectively Amazon's strategy).
Yes, but that's still a profit based motivation. My point was that the board of a for-profit company doesn't have a fiduciary duty to represent non-financial interests of the company or shareholders.
That is, you can't sue the board of a for-profit company because they didn't uphold their fiduciary duty to represent your interest of having a free-speech platform, even if you had made it very clear that to you this is much more important than profits, and even if you owned 100% of shares [well, you can sue, but the case will be quickly thrown out]
Conversely, the board can always claim that they made free speech a priority because they believe that will help drive long term profits, even if shareholders asked them to focus on profits to the detriment of free speech, and even if profits immediately tanked after this decision; and they will likely win in a trial.
I'm not a corporate lawyer, and by no means an expert, but I think this is propagating one of the great myths of the last 40 years or so. Profits/finances are not the sole-arbiter of success, even in for-profit companies. A fiduciary duty is not simply to profits, but to the success of the company (however it and the shareholders measure it). Granted, they likely need money to continue with whatever is their measure of success. There will always be those that feel that the sole duty of a company is to profit, but that doesn't mean they are correct.
Ok, try to find a breach of fiduciary duty trial that didn't involve profits (discussing a for-profit company, not a public benefit company or other organization).
The famous Dodge v Ford was about Ford increasing employee wages and reducing prices, at the cost of profits. One of his main motivations was to avoid paying out dividends to the Dodge brothers, who were using said dividends to bootstrap their own car company. The trial found that Ford has ample leeway in running the company as he sees fit, but can't simply ignore profit completely or do things with the sole purpose of avoiding profit.
That trial specifically seems pretty specific to his attempt to avoid paying the Dodge brothers. And I'm not saying the courts don't sometimes say that profits are the most important thing, and I'm not even saying they aren't important. But that it's not the sole thing (or even the definition of) fiduciary and so a board of directors could, as fiduciaries, make decisions at the expense of maximizing profit.
People are overlooking the fact that a poison pill will likely increase the price of Musk's final offer, and in doing so will maximize shareholder value.
Put another way, Musk may be willing to pay a lot more than a 25% premium for Twitter (he already said he doesn't care about price). Without this poison pill, Musk can force a takeover by accumulating shares. With this poison pill, the board has leverage to maximize his final offer.
I don't think its possible for Musk to ever attain 51%, everytime the price sinks and he accrues shares, they would just choose to issue more shares diluting his equity.
really think Musk knew this ahead of time...but what's his end goal i can't figure out. is it to profit off his purchase? because if he wanted to acquire 51% this is the worst way to do it (creating a hostile board who can at will issue infinite amount of shares)
He said it's not an economic decision, that doesn't mean price he pays isn't considered; he also said it's his final offer, whether that's just presenting a firm stance as a negotiating tactic or not, I don't know; ~$40 billion investment (far less) could create a better platform than Twitter with mass but it wouldn't be a head start that it looks like he's wanting to buy.
or the stock can be dumped with public fanfare, bringing it to a fantastically low price. Then, it can be purchased back, even with the 25% premium, likely for the same total price.
1. The Twitter board of directors has become a status thing. It's like a country club. They don't have real skin in the game; they don't own much stock. They're not aligned with the shareholders. It's about status and cultural power.
2. Why should we believe that the company will become more valuable when the stock price is where it was way back in December 2013? Compare to how the S&P or Tesla did during this period. Twitter has languished for a long time.
3. They should put it to shareholder vote.
4. One AI engineer from Tesla could solve Twitter's bot and spam problem.
5. The elites have somehow inverted history so they now believe that it is not censorship that is the favored tool of fascists and authoritarians, even though every fascist and despot in history used censorship to maintain power, but instead believe free speech, free discourse, and free thought are the instruments of repression.
> One AI engineer from Tesla could solve Twitter’s bot and spam problem
I think you underestimate how hard the problem is or you don’t fully understand how it works. The scale at which Twitter operates makes it near impossible to take down spam in real time. You don’t think Twitter is working on it, but they are. What you see is a much smaller percentage of the actual spam generated, and the reason you see it is because users are creative on circumventing all the preventive actions they take.
To think that a company that has failed to create self-driving for nearly a decade could solve "content moderation", one of the hardest problem on the internet that every single of the big companies (who btw hire the best talent) have been struggling with, is truly a shocking statement to me.
If all Google and Facebook couldn't solve it, why could a Tesla engineer of all people...
The idea that an AI engineer for self driving could be trivially retasked to content moderation is fairly laughable as well.
That's not to say there aren't overlapping skill sets, but the AI tech involved is quite distinct (although there is overlap, I believe some of the latest perception research is trying to adapt transformers from NLP to replace CNNs). Many of my colleagues are AI/ML engineers working on the self driving problems (perception, prediction, planning) and they're all super smart, but they'd still take a while to get up to speed in another area.
I have no idea why a serious business would hire a non-NLP specialised engineer to solve content moderation (they'd maybe hire someone who was interested in changing sub-field, but not to build out the backbone of their teams).
Also to think that an engineer who’s intentionally joined a company to work on AI self driving tech wouldn’t immediately quit when they where forced to move and work on Twitter content moderation is laughable. They’d find another job faster than Musk changes moods.
I also find it "laughable" how literally everyone is taking the comment. They weren't saying they'd just take some computer-vision expert and retool him to fix all of Twitter's spam problems.
Spamming "$$$ TSLA to the moon! Get latest tips on my free Discord http://biy.ly/ocozxc #TWTR #GOOG #AMC #GME $$$" thousands of times for days being suspended is hardly the hardest problem on the Internet
Spamming "$$$ $TSLA to the moon! Get latest tips on my free Discord bit.ly/ocozxc #TWTR #GOOG #AMC #GME $$$" thousands of times for days before suspension is hardly the hardest problem on the Internet
Heck, you could even just limit the number of hashtags in a single tweet (say, 2) and fix 95% of Twitter's spam problem without harming legitimate users in any way
Uh, wouldn't spammers just...stop using lots of hashtags? Part of what makes the problem difficult is that spammers are agents who respond to the techniques you use to stop them.
1) I think Elon Musk's angle on Twitter spam is rather different than ours. Look at replies under his tweets.
2) I am not an ML engineer, but still a software engineer and in my opinion the problem of self driving cars is at least two orders of magnitude harder than the problem of Internet spam. Maybe even three orders of magnitude.
3) We actually know that the problem of spam is successfuly solved by Google. When was the last time you saw a spam message in Gmail? I am seeing them in my inbox approximately once a month. There are about 8 messages in my spam folder per day, so it is about 0.4% false negatives. This is a great result.
4) Social networks are not interested in fighting spam. It just will make their metrics worse. All they need is to keep it at moderately acceptable level, so users won't flee in bunches.
We're not talking about the hardest content problems on the internet. Look at any of Elon Musk's (or anyone in crypto's) popular tweets and you'll see a flood of incredibly obvious bots that poorly mimic his account, spamming some shit coin or advertising a BTC address.
Also, you're really understating how good Tesla self-drive is. It's not full self-drive but it's a real achievement.
Yes, and Youtube and Facebook both have similar problems. There is survivalship bias at play here, you do see the bots that manage to get past the spam protection, but never see the ones that don't. For all you know, Twitter could be blocking 99% of the spam. Of course, as long as there's money in it (and there is), spammers will constantly be coming up with new and unexpected ways to bypass your systems. It's a neverending battle, and if you think it's trivial, you are the one understating how hard the problem is.
I never claimed Tesla self-driving wasn't an achievement, but clearly they underestimated how hard that would be themselves, so I wouldn't be surprised if they'd do the same for content moderation.
> Youtube and Facebook both have similar problems. There is survivalship bias at play here, you do see the bots that manage to get past the spam protection, but never see the ones that don't. For all you know, Twitter could be blocking 99% of the spam.
If you spend 5 seconds on YouTube and Facebook and compare that to Twitter, you'll see a massive difference.
The spam bots on Twitter are incredibly unsophisticated. It's literally bots with the same profile picture and name as the person they're trying to spam.
On the other hand, YouTube spam bots are actually incredibly sophisticated. They're using GPT-3 or some language model to generate text and reply to each other. Like, sometimes I'll read a comment and not be sure if it was a spam bot or not.
Obviously YMMV but in 2021, every tech video I commented on would get these replies, which all had 18+ profile pictures. Clicking their profile every account had the exact same "playlist" with a porn site ad inside, and the channel header had the exact same website link. I kept getting these for months.
There's a substantial qualitative difference between what gets through Youtube's and Facebook's filter, versus what gets past Twitter. They're not even practicing the current state of the art, as practiced by their peers.
I know there was one instance when an engineer using an internal build got fired for vlogging it (which is not at all unusual, Apple would also fire you for showing off an internal build).
Tesla FSD is level 3. You still need to be fully aware and hands on the wheel. Level 4 is when no one needs to be at the driver seat, which is what Cruise and Waymo are doing.
Quantity != Quality. Just because McDonalds serves billions of people doesn't magically make it good food.
A large part of the problem for twitter Google and Facebook is their ever shifting goals for content moderation to appease their politically activist employees and media critics.
Something tells me Elon would have different goals that should be less of a moving target and easier to accomplish. Less subjective target like "hate speech" and more objective target like true threats of violence, illegal activity, actual bot detection not "people who disagree are bots", etc
Spam volumes are also down dramatically due to conventional means like making it illegal, and taking down bot farms that were sending it. Also the introduction of DKIM and DMARC making it harder across the board to be seen as a legitimate sender, and the fact that many-to-many emails are a huge red flag for spam filters, and not a concept for social media.
Spam is a dramatically easier problem, and has many more mechanism to suppress it both legally and technologically.
Occasionally? Recently (maybe the last 6 months) I have been seeing a huge amount of spam getting through (comparatively - maybe 10 a day make it to my inbox). Previously I rarely saw any.
In the last two weeks my gdrive has been spammed with shared porn pdfs. It's not even being shared with the email address I use, it's being shared with my email without a full stop in the middle that Gmail ignores. Haven't looked into it much but apparently people have been asking for years for an option to only allow a doc to be shared from a know contact, Google has ignored this for a long time.
Well the government bills always get filtered out for me, I agree with gmail that it's spam however the goverment doesn't agree when I didn't pay a few times. So opposite is even worse.
It is relevant actually. I worked on spam fighting on Gmail for a while and when I quit Google, I was invited to Twitter for lunch and (though somehow I wasn't actually told about this) to give an impromptu talk to their spam teams.
Because the guy who invited me sort of sprung the talk on me I had no slides or anything, so it became a collection of vague thoughts + discussions with their team (vague because I didn't want to discuss any trade secrets). One thing that became very clear was that they weren't thinking about bots a whole lot compared to the Google abuse teams, because they'd been re-tasked at some point to consider abuse as primarily meaning "humans being mean to each other". A significant amount of their effort was going on this instead, although there is really little overlap in technologies or skills needed between problems.
This was pre-2016 so the whole Russian-social-bots-gave-us-trump hysteria hadn't started yet, instead Twitter was being declared toxic just due to the behaviour of its users. Thus the term bot still meant actual spam bots. Since then various groups, primarily in academia but activist employees too, realized that because deleting bot accounts was uncontroversial they could try and delete their political enemies by re-classifying them as "bots". For example this Twitter developer in 2019:
“Just go to a random Trump tweet, and just look at the followers. They’ll all be like guns, God, Murica, and with the American flag and, like, the cross. Like, who says that? Who talks like that? It’s for sure a bot.”
Clearly any abuse team that uses a definition of bot like that won't be able to focus on the work of actually detecting and fighting spam bots. If Musk bought Twitter and re-focused their abuse teams on classical spam fighting work it'd almost certainly help, given that Twitter didn't seem to be keeping the ever-shifting overloads of the "abuse" clear in their org structure.
Incidentally, trying to find the above quote on Google is a waste of time. Search "project veritas twitter for sure they are bots" on Google and the links are almost all irrelevant. DuckDuckGo/Bing gets it right on the first result, no surprise. I don't believe for one second that's a result of incompetence on the part of the Google web search teams.
> “Just go to a random Trump tweet, and just look at the followers. They’ll all be like guns, God, Murica, and with the American flag and, like, the cross. Like, who says that? Who talks like that? It’s for sure a bot.”
Hahah wow this is so out of touch. Communities each have their own way of speaking (famously /r/wallstreetbets has its own grammar, emoji, and lingo, but this applies to every community).
Sidenote this is why minorities speaking with each other sometimes get misclassified (even by humans!) as spam.
An alternative take: there's spam that's trivial to spot and spam that's hard to spot. Twitter is ignoring both. I can give you both searches and keywords to post which will return lots of spam ready to block. Not everything of course, but let's not post the "spam is a hard problem" excuse until they nuke every account responding with "metamask" and a link to Google forms.
You don't nuke the accounts, you make it so no one can see their posts and they don't realize. Make them waste their time instead of creating a new account.
My thesis is: if they put in minimal effort into automation, then metamask spam would be trivial to block. Since we know of the metamask spam for months (years?), it means there was no effort. I could be wrong, but I'll stick to the most obvious explanation.
It's been going on for months - if you're not aware of this it doesn't mean it's not widespread. If you tweet "metamask problem", you'll get a number of bots immediately responding with Google forms links for "metamask support". Yes, it's very widespread and extremely obvious. Both fake support accounts https://twitter.com/metamesksuport/with_replies (I can find at least 10 more "support" accounts from a basic search) and helpful randos https://twitter.com/ij851227/status/1515302472079847425
It's been tweeted by multiple security people at various Twitter engineers already and raised in lots of ways. They know and don't care. Meantime, real people lose their money - otherwise nobody would waste their time to post the scam.
Some scammers who appear in Musk's replies impersonating him use similar or identical avatars and screen names in order to perpetrate their fraud. Removing and preventing the creation of this type of account would not even require "AI". It hasn't happened yet because Twitter lacks the will to do it, for whatever reason.
Calculating the levenshtein distance from users, the average difference between the avatars, and looking at basic interactions in reply-to-reply-to-users isn't AI. That's heuristic. And it should have been implemented ages ago.
Spam on most platform is a complicated engineering challenge. However, for some inexplicable reason, Twitter features a kind of spam that you don't see on any other platforms because it could be caught with a regex.
It's almost never the case that spam issues on popular social networks can be alleviated with some easy fixes, because obviously if they could they would already have done that. Twitter is a very weird exception.
The spam scale problem should be solvable with a one-shot locally evaluated NN trained to classify behavior/tweets from their massive massive ground truth dataset. If it’s evaluated locally then I don’t see how scale is an issue.
I reported child pornography on twitter. It took a while for it to be taken down.
Yet people talking about hunter biden’s laptop in October 2020 had their accounts deleted immediately.
Twitter is very good at content moderation when it threatens the manufactured narrative of the global elite which they serve. And then completely incompetent otherwise.
I don’t buy the line that the problem is too complex because I see selective competence.
If they stopped reporting and focusing on MAU, the problem isnt that hard to solve. If you want to operate a bot on twitter, it costs X/month or just make bots illegal.
The problem would be more surmountable at that point
AI Engineers at Tesla also deal with spam, just not in the way you think. Self driving AI has to deal with input spam from all sorts of details in the real world, most of which are irrelevant to making driving decisions. So yes, I’d be reasonably certain AI Engineers at Tesla could easily solve spam on a simple web platform.
I know how hard it is to deploy features at scale, especially at a world-class company like Twitter. But if Twitter were to retain me as a consultant, I’d happily bet you any sum of your choosing that I’d make a pretty big dent in the crypto spam within a few months of full-time effort.
For those blindly downvoting that, here's what Paul Graham said:
"Either (a) Twitter is terribly bad at detecting spam or (b) there's something about Twitter that makes detecting spam difficult or (c) they don't care.
Based on my experience detecting spam, I'd guess (c)."
"Twitter engineering: If you're going to do such a bad job of catching spam, how about at least giving us a one-click way to report a tweet as spam and block the account, like email providers do? It may even help you get better at filtering, since more reports = more signal."
They’re likely downvoting my somewhat dubious claim of being able to singlehandedly make a big dent in crypto spam tweets.
I appreciate your gesture, but I don’t mind the downvotes. Bold claims warrant skepticism. And talking about votes makes the conversation less interesting for the audience.
But you’re right to point out that the problem isn’t nearly as intractable as it seems. There are many ways to deter crypto spammers.
Think of it this way: suppose Twitter’s stock price was inversely proportional to the amount of crypto spam (without accidentally removing genuine tweets). Does anyone believe the stock price would go down?
It’s why I suspect Twitter simply hasn’t made it a priority.
I remember reading several times that the enormous number of bots on Twitter inflates their "active users" stats and therefore their stock price, which is why they aren't fighting it.
The problem is false positives. Graham's experience of combating spam involved writing a Bayesian filter for his mailbox. That's fine. Somebody misses a message and one of the two parties feels bad, but they eventually either catch up or get over it. You can't "leave" that platform.
Twitter, on the other hand, is pretty sensitive to false positives, and the vernacular is so unique that naive Bayesian filtering would destroy a lot of communities with their own vocabularies and languages. If messages start arbitrarily dropping on it, its users won't stick around.
Sure, you could absolutely knock out spam. It wouldn't be that hard. Because fighting spam isn't the hard part. It's dodging the problem of firing on innocent people that the spam is using as body shields that's the hard part.
They already get incredible volumes of criticism for what little false positives they already have. Imagine if it was normal to be put in a time-out box by a Bayesian filter that wasn't tailored for your community!
Combating spam is something that has very few possible upsides for twitter, and a catastrophic failure case. Right now, spam mostly tends to effect larger accounts, who are going to stay on the platform anyway, because it's where the people are. What little spam small accounts see is manageable, and they won't leave because of it because it's so insignificant. If suddenly they couldn't send messages to others at random and without warning? Why would they stick around, then?
I do believe Twitter isn't doing well at fighting spam, also that it's a pretty hard problem. But where do you think people will go after leaving Twitter? Is there an option?
Does it matter where they'll go? People will always find some spot on the internet to have conversations after a given platform hits the friction threshold, and some might not even go anywhere: They might just leave.
Where people will go doesn't really matter, because there are a billion places they can, and there's not always a clear migration path. Sometimes, a social platform just dies, and its communities form a diaspora on different platforms, without any "clear" successor (like what happened to Orkut), or just stop doing the whole social media thing (many Google+ contributors no longer post online anywhere).
My question was kinda selfish. I want to move now. If there are a billion places, please tell me so I can move there now before the masses arrive and even that gets ruined :)
There's no easy answer to this. A billion different places users could go doesn't mean they have active communities, and if I mentioned where I like to hang out on the internet, those areas would probably get ruined.
Instead, I'll mention two platforms some of my friends like, to avoid taking the cost of a ruined platform myself:
sqwok.im: This one is the most microblog-like of the two, but it's also the least conventional. The quality varies; the front page only looks good every once in a while.
tildes.net: This one is invite-only, which helps mitigate the masses jumping in somewhat, and is run by a former reddit administrator. The existing community isn't great, but it's good. Friendly enough people.
I’d happily bet you any sum of your choosing that I’d make a pretty big dent in the crypto spam within a few months of full-time effort.
Could you do that while also making sure no false positives happen? Elon is making claims that he wants to make Twitter a platform where people are truly free to say what they want, so any spam that gets removed that isn't spam would be seen in a very poor light.
Eliminating spam when you're happy to have a few other things end up in the spam folder by mistake is relatively simple. Likewise, eliminating most of the spam but letting some through because it looks real is also quite easy. Eliminating only spam and nothing else is significantly harder.
The reason it's a ludicrous claim is that while there's overlapping skill sets, the idea that you can take an AI/ML engineer working on perception or prediction or planning problems and trivially apply them to textual content filtering is laughable. They could certainly pivot across, but it would take them a good chunk of time to get up to speed, you'd be better off hiring an engineer more familiar with that particular space.
The fact that they specified it being an AI Tesla engineer is super cringe Tesla-bro stuff and the fact that the commenter would say something like that hurts their credibility in making the other fairly extreme claims.
It's not just that they're wrong, it's that they're talking nonsense. An ML engineer working on perception models can't be trivially retasked to an NLP spam filtering problem.
If they're obviously talking out of their arse on one point then it definitely suggests they're talking out of their arse on the rest of it.
> The elites have somehow inverted history so they now believe that it is not censorship that is the favored tool of fascists and authoritarians, even though every fascist and despot in history used censorship to maintain power, but instead believe free speech, free discourse, and free thought are the instruments of repression.
It feels a little silly to act like the guy trying to spend billions of dollars to get his way represents anything more than an intra-elite conflict.
So what? .... if we, normal people get more free speech, and a few billionares swap some money around, it's still better then them just swapping money and we not getting any free speech.
What makes you think you will get any more free speech by the grace of Musk's intervention? He has repeatedly shown he is pro-free speech that he likes and anti-free speech he doesn't like.
So, then it doesn't matter... Rich people do what rich people do, with musk+twitter combo, there's atleast a chance you'll get more of a voice, with some other combo (eg. disney buying twitter), you already know there's zero chance for that.
- I see you've edited to "intra-elite" conflict. So is basically every problem in society then given that governance is handled by few. Not sure what the point is here, just feels like a hollow dismissal.
I didn't edit it. It always said that. And it is "his way" because "less censorship" almost certainly doesn't actually mean they just let people post whatever (and even if it did, do "we" all agree that would be a good idea? Probably not).
We’ve been hearing bad-faith censorship debates long enough to know how this song and dance goes, haven’t we? “If I say something, no matter how vacuous and offensive, that’s free speech. But if you criticize it or otherwise say something I disagree with, that’s censorship.”
Beyond that, the idea of a totally unfettered Twitter is not really desirable. Such forums fill up with porn, gore, racism, and various other forms of shock content nobody actually wants on their feeds.
I've seen no advocates of saying that individuals shouldn't be able to curate their own feeds, only that social media platforms shouldn't be restricting those feeds for them.
For instance, if you decide that you want a Twitter feed that excludes porn, gore, racism, and other objectionable content, then you absolutely should be able to exclude those (I'd reckon that that'd be a very sensible default). If I want to go observe the crazy bigoted things that fringe groups are spewing, or if I want to use Twitter just as an endless feed of porn, then that doesn't affect your ability to not see those things.
Likewise, I've not heard Musk propose banning any of his critics or opposing viewpoints (though I don't really follow his actions, so it's possible I've just missed them).
He has pursued aggressive union-busting, sued whistleblowers, sued people for posting videos that made telsa's """autopilot""" look bad. It's clear he doesn't give two shits about free speech, except when it costs him nothing to do so and therefore amounts to free virtue-signalling.
> “If I say something, no matter how vacuous and offensive, that’s free speech. But if you criticize it or otherwise say something I disagree with, that’s censorship.”
What an embarrassingly dishonest characterization of the problem. Nobody sane is arguing that "criticism is censorship".
The problem with Twitter is that they are censoring popular narratives critical of the ruling elite. If you can't distinguish between the concept of banning accounts and posts vs not doing so, and allowing criticism, you are simply too misinformed or low IQ to have any worthwhile input.
(Though I defend to the death your right to babble incoherently)
> What an embarrassingly dishonest characterization of the problem. Nobody sane is arguing that "criticism is censorship".
Is that so? Why do the same people who claim they’re all about free speech get all wound up about “cancel culture” then? There are clearly rules in their head about who should actually have the right to say whatever they want. I quite confident that I am not “low-IQ.”
“Cancel culture” is about people losing their jobs and being censored from platforms like Twitter for making arguments or jokes that rub the politically powerful the wrong way. Again, it’s the active removal of the practical ability of expression that rational adults are concerned with, not the fact that others have contrary opinions to them. Again, you are exposing your ignorance.
Being "lame" doesn't make it untrue. People use the term to refer to "shaming" (i.e., vocally disagreeing with) celebrities for their political stances, or refusing to patronize businesses that take political stances, for instance.
I truly don't understand this business of thinking everything shitty needs to be banned and denied as a right. Like, I take a pretty dim view of hookup culture, but I'm still going to denounce any attempt to make it illegal or deprive people of the right to fuck N different people per week. Because I'm more interested in freedom than agitating to hammer the world's people into a min/maxed social utilitarian dystopia. I'm trying to understand when and how America started pining for its own Soviet Union so hard. Or is this just a Liberal Technologist thing? Just want the government to do the AI Genie's job until the AI Genie wakes up? Like children trying to birth their own parents.
Cancel culture is NEET busybodies making it their day job to hunt for le problematique like bounty hunters (paid in retweets) organizing mobs to campaign to ruin people's lives (for great justice!) Yes, it's free speech! Yes, it's free association! Yes, it has precedents, you savvy insightful geniuses! Most things do, we call that history, and it's full of terrible things we should probably stop doing.
But this modern manifestation of a thing that has precedents and conservatives do too sometimes also has interesting features that are probably worth talking about on their own terms. I repeat: Cancel culture is NEET busybodies making it their day job to hunt for le problematique like bounty hunters, organizing mobs to campaign to ruin people's lives. It's legal, they have every right, and it's shitty, shitty behavior. Please stop denying it's a thing, or alternately trying to whatabout it to death.
What's at work is the recognition that "free speech" is a nice bumper sticker but doesn't go that far beyond that -- there are many policies one could pursue and plausibly call free speech. For instance, one could easily argue that we don't have free speech because money buys access. Somehow the right has been successful in claiming the mantle of "free speech" to mean something specific (basically that anyone can broadcast right-wing views without consequence) but that's not the only way the term could be conceived. There is also growing recognition that some things are outright harmful. Social media has already been implicated in pogroms; platitudes about the power of free speech seem to ring a bit hollow in that light.
On the cancel culture front, I don't agree. It actually refers to an incredibly broad segment of actions which almost nobody actually has much of a consistent line on. Often simply criticizing or refusing to patronize someone's business is called "canceling." Even if we narrowly refer to people losing their jobs, nobody actually believes there are NO circumstances whatsoever where losing your job might be an appropriate response to something you said. If you're a special ed teacher and post on Facebook that people with intellectual disabilities are less than human, one could reasonably doubt that you have any business having charge of special ed kids. If you want a more conservative flavored example, you could probably find conservatives endorsing cops losing their job if they bragged about not enforcing immigration laws. Or if you want an extremely uncontroversial example, you must at least believe it's appropriate not to VOTE for someone because you didn't like what they said. I don't think it's an accident. I think this term is so slippery and amorphous precisely because it obscures the hypocrisy at work.
You mean self driving, which they promised would be ready over 5 years ago and still barely at L3 level? Meanwhile Google engineers have actual L4 level self-driving in both Phoenix and San Francisco (by your logic, they are better than Tesla engineers), yet have not managed to solve Youtube's spam problem.
>Meanwhile Google engineers have actual L4 level self-driving
They don't have L4 self-driving they just made a contrived railway system for their cars. The second the car is out of the hardcoded route it's not a self driving car anymore.
First off, it's a hard coded area, not "route". They're not buses. A limited area is part of the definition of Level 4. What you're thinking of is Level 5, which is being able to handle any area and situation.
There are also reasons beyond capability for the cars being limited to an area. One is legislative, they literally are not allowed to offer service outside a given area. Another is maintenance, the cars need to be within range for their team in case of emergencies or accident. The cars have been tested in many cities outside those two cities, but offering a user-facing service has a lot more barriers.
So it dosen't have a single route, it has a couple of them. Mapping the whole area beforehand then driving in it is not "self" driving. You don't go out and carefully map each square inch of the road you're going to take before driving your car on unknown roads do you know?
"Spam bots" on their own aren't a hard problem. The hard problem is a very restrictive set of constraints on the solution space, e.g. "can't inconvenience or increase barriers to posting for legitimate users in any way."
> The elites have somehow inverted history so they now believe that it is not censorship that is the favored tool of fascists and authoritarians, even though every fascist and despot in history used censorship to maintain power, but instead believe free speech, free discourse, and free thought are the instruments of repression.
At which point in history could any person blurt out a brainfart and have thousands of people around the globe hear it and react instantly again?
When the printing press was invented ther was a backlash against it, because free speech was endangering existing power structures.
Nowadays we have it the other way around, powerful players use the accelerated chaos of social media to avoid any real discourse from forming — it is just very easy to manipulate just enough into your direction to hide behind "differing opinions" if you have a ton of resources — just like boulevard media has been for the past decades. Censorship and media control is one strategy to reduce the chaos by decelerating the spread of the most outrageous unfounded claims. Of course there can be such a thing as too much censorship (e.g. look to China and Russia), but this would be state censorship.
A billionaire does not want to buy a social media plattform because he cares about free speech — if that was the case he would have nothing about his workers discussing unions, post youtube videos he does not like or journalist writing negative things about him and still being able to buy a Tesla car.
I am not sure there is much wisdom in assuming we can have a world wide instant public microblogging platform without any moderation at all. Anyone who ever operated any public web platform knows the quality of the discourse falls drasticly if there is not at least some level of content moderation.
> One AI engineer from Tesla could solve Twitter's bot and spam problem.
You are heavily overexpecting what the technology can do. Differenciating satire from a threat with sufficient accuracy is not something machine learning ("AI") could do right now.
> At which point in history could any person blurt out a brainfart and have thousands of people around the globe hear it and react instantly again?
Usenet, for several decades already. Good NNTP servers had nearly perfect spam filtering and the trolls were handled individually by each user in killfiles.
If Google had kept the simple original web interface from around 2004 we might not have had all these issues. GPT-3 spam is hard to detect, but can be handled by killfiles.
Of course the real goal of Twitter is to do user profiles and possibly log private messages, for which Usenet isn't suitable. I wonder who on earth would send a sensitive "private" message on Twitter.
Usenet was much, much smaller and quite certainly not a statistical representation of society (people who could afford, access and understand the thing).
Most modern problems with social media started emerging when the general public started using it.
Specialist communities like IRC channels, Hacker News, certain subreddits or webforums still work quite well, because let's face it: It is not the general public there.
And even in specialist communities there is a certain degree of moderation needed in order to keep it in order.
In the offline worlds individuals for which (reasonable) moderation is needed are kept in check by society (either through social pressure or physical force).
Very seldom they are the beginning of societal changes but usually they are just unpleasant (e.g. "I hope you and your loved ones get murdered because...") people which most others avoid if they can.
I'm very sure I would leave any platform where their kind is allowed to run wild and so would many of my family and friends.
Facebook is a very good example: Most people are boring and nice enough. Those who are not (ranging from annoying to vile) spoil the fun for everybody else.
People leave (in part) because they don't want constant conflict and not every opinion is worth to be heard.
> That's a false dichotomy and the exact argument one would expect from a proponent of censorship. That puts you in the wrong camp, the fascist authoritarian camp, sadly.
Sadly you don't really elaborate on how my comment reveals the authotarian position you do falsly assume I hold.
There is a position between no censorship and full authotarian style censorship and it is a common rethoric vehicle to first talk about the extremes to show that the reasonable area is somewhere inbetween (and then we can talk about trade offs and priorities).
My main point as someone who studied media science is that we cannot treat modern social media with the exact same rules we treated other speech with, because ultimatly it is a different place to speak in. The social distance is lower than anything we ever had in history, the audience bigger than ever in history, it feels private but you are in the spotlight at the same time (and people tend to act like this). It is a place where a rural person communicating a rural opinion will be directly next to a city person communicating a city opinion. Before social media you had natural borders of which people could actually hear (and/or react to) each other. So it is fundamentally different place than anything we ever had before it.
And different places have different rules. Someone who speaks loudly in a library will be thrown out (because the place has a certain function and them speaking loudly interferes with that function). Someone who repeatedly and loudly farts in a restaurant might be thrown out. Someone who listens to music in church might be thrown out. A bare-breasted women in a mall might get thrown out etc. Different places, different rules.
The question now is: what kind of place is something like twitter? What behaviour shall be accepted or restrict there and with what goals?
If our goal is the equivalent of a verbal bar brawl where people can let out their innermost emotions we might end up with different rules than if our goal is rational and fact-oriented discourse with the goal of moving discourse forward (these places have typically stricter rules of which speech is acceptable, as can be seen for example here on HN).
With twitter a lot of the emerging behavior that can be observed is a direct result of or a direct reacrion to the systemic structure of the place. If this shall be seriously changed you have to either establish a new culture how one has to behave in such a place (hard) or you change the systemic variables itself (easier).
But one point I want to stress is: by allowing most speech one might involuntarily prevent other, more nuanced speech from ever emerging.
Many, many people are absolutely arguing that zero moderation is appropriate.
Anyway, you also acknowledge that some moderation is both appropriate and necessary. So, now we know your opinion of a private company’s moderation is different from the parent commenters, but you both believe moderation is necessary — and then you call them an authoritarian fascist.
Moderating bot accounts and frivolous antagonists (by virtue of repeated defamation/inflammatory speech) is appropriate. Those are not in the same vein as restricting speech. If a bot account is openly listed as such with links to show it is not a human agent, then it can be openly suppressed.
This isn't a similar argument nor a difference in degree of the same position.
But I don't take your statement with any credulity based on your handle
6. My favorite prediction. Twitter continues to ignore any of Musk's offers. Musk sells his 9% stake. Price goes down. Continues to go down since Twitter('s mgt) is full of shit. Elon gets in an offer when price is languishing at low $30's. Twitter has no choice but to take Elon's offer.
All in Podcast can be fun but it's way more on the side of entertainment than information/insight. There is a lot of self-serving narratives on that show, and I think they'd be the first to admit it. One of them was saying a few weeks ago that the root cause of the Russian invasion of Ukraine was Twitter, so you know.. grain of salt and all that.
"5. The elites have somehow inverted history so they now believe that it is not censorship that is the favored tool of fascists and authoritarians, even though every fascist and despot in history used censorship to maintain power, but instead believe free speech, free discourse, and free thought are the instruments of repression."
Yes. Gaslighting crystalized. We are now to believe free speech is bad. Authoritarians know auguring against logic is hard.
Why should a company be forced to carry, host, and service the speech of others?
If Twitter is a monopoly, apply anti-trust laws to it and break it up.
If Twitter isn't a monopoly, then they should every right to decide what their service does, as long as it's within the law. If you don't like the current laws, change them.
I am totally, 100% opposed to privately owned companies being forced to carry speech that they don't want to carry. That itself is a violation of the free speech of people that operate businesses.
> 5. The elites have somehow inverted history so they now believe that it is not censorship that is the favored tool of fascists and authoritarians, even though every fascist and despot in history used censorship to maintain power, but instead believe free speech, free discourse, and free thought are the instruments of repression.
Not every speech is equal. If you are living in a Weimar-Republic scenario, yes, free speech can be repressive and I can see why people will call for censorship. Personally, I think censorship and speech taboos just keep a lid on certain problems instead of solving them.
> Not every speech is equal. If you are living in a Weimar-Republic scenario, yes, free speech can be repressive and I can see why people will call for censorship. Personally, I think censorship and speech taboos just keep a lid on certain problems instead of solving them
The problem with this is that it always ends up as “censorship is ok, as long as it’s for opinions I disagree with”.
And with your Weimar-republic scenario, if the implied claim is that more censorship would have stopped either the radicalisation or rise of Adolf Hitler, I think that’s very simplistic and highly suspect.
I don't mean to sound rude, but Tesla engineers can't even distinguish the moon from a stoplight. Human interaction and defending against a naturally intelligent adversary are not so simple.
People keep bringing up your point 5 here. Almost every other comment seems to parrot this idea that there is some paragon of free speech that Twitter doesn't achieve.
Setting all the discussion of what free speech should be, aside,
I don't see people making the point that Twitter's huge success as a social media platform may actually relate to their moderation policies. Twitter was found to be more resistant to fake news than other social media sites. I don't know whether this relates to the public nature of tweets or their moderation.
Twitter's moderation policy may exactly be the reason the platform has done so well, and rather than clamouring for Twitter to change, I'd suggest that we allow the free market to allow another platform with different a moderation approach to compete.
>5. The elites have somehow inverted history so they now believe that it is not censorship that is the favored tool of fascists and authoritarians, even though every fascist and despot in history used censorship to maintain power, but instead believe free speech, free discourse, and free thought are the instruments of repression.
Fascists and authoritarians took advantage of freedom of speech to gain power, the censorship came after they seized power. Hitler promoted himself through his right to speak at his trials, and through his book Mein Kampf, things the Weimer Republic could have absolutely chosen to censor. Karl Popper made a rather infamous observation of the "Paradox of tolerance" where tolerating the intolerant could result in more intolerance, if the intolerant happened to be Hitler in Nazi Germany.
I find the biggest objection to this entire line of thought is that censors always consider themselves to be the ones resisting the next Nazi Germany rather than being Nazi Germany themselves. Anybody who openly censors others is more likely than the general person in the population to be some sort of totalitarian authoritarian, so trusting them with power so they can stop some sort of Nazi uprising is foolish. It's the same kind of issue as "Bombing for peace", pretty much 100% of the people who have ever bombed people have said they were doing it for the sake of peace.
This all being said, I don't think giving Musk 100% of twitter and the effective absolute power to censor others on the platform is a good idea.
> 4. One AI engineer from Tesla could solve Twitter's bot and spam problem.
I don't know why people think is the problem.
They regularly ban bot and spam accounts. This is not an issue.
The issue is malicious/ignorant human actors and malicious state level actors.
Tesla AI engineers can't even get past L3. There's no chance they would be able to create an AI solution that can fight state level resources or massive amounts of humans gossiping and spread misinformation.
> One AI engineer from Tesla could solve Twitter's bot and spam problem.
Translation: "AI is a magic spell! I can take someone who's been working on vision recognition, and they alone could wish all our bots and spams away, with the magic of AI."
> The elites
Oh, god, here comes the libertarian spiel...
> but instead believe free speech, free discourse, and free thought are the instruments of repression.
Translation: "I want the right to tell any lie I please without consequences. I want the right to be able to scream at people on the Internet and keep my account. If I can't call someone racist names on the Internet, it's because you're all Fascists and authoritarians!"
I'd never heard of All in Pod, and so I listened to the section from 43:00 on about this being a 'free speech' issue.
Quick takeaways:
- The frequent pejorative use of the term 'elites' as a catchall for literally anyone they disagree with is hilarious. Their explanation of Musk being the iconoclastic 'anti-elite elite' sounds like Ayn Rand fan-fic written by a 14 year old who just read the Wikipedia plot summary for Atlas Shrugged.
- What does 'inverting history' even mean? It seems to be another example from Glenn Greenwald's vast and vitriolic argot. (I'm sure Glenn Greenwald is another commendable 'anti-elite elite').
- Paraphrasing: "journalists 20 years ago would have been defending the first amendment!" -> this is not about the first amendment. The first amendment protects your ability to speak freely from government imposed restriction or suppression. Ironically, twenty years ago the press/journalists and even government officials were experiencing one George Bush's sweeping censorship efforts (https://www.americanprogress.org/article/think-again-the-bus...).
Anyway, the hosts wistfully allude to the past, with references to society's 'public square' and people having the ability to say whatever they wanted with no repercussions. This is nonsense. Broadly, you can absolutely say whatever you want online — it's easier than ever.
That doesn't mean:
1) Twitter is required to provide a platform for you to abuse and harass people, or spout opinions they deem to be offensive, damaging, or misleading. That's their choice.
2) Free speech has never been consequence-free. To quote Michael Hobbes: "Voicing your opinion in public has always carried the risk of being shamed or shunned."
Finally, I will concede that twitter has suffered from poor growth, and a change in leadership could be a good thing for the company. But the board also has a responsibility to protect minority shareholders from people exactly like Elon. Their resistance to his efforts may have nothing to do with the vague, insulting and unsubstantiated allegations you and the podcast hosts make (It's a 'country club', board members are only acting against musk to protect their 'status', etc). Rather, they may quite reasonably believe that a vainglorious egomaniac who has been repeatedly sanctioned by the SEC may, in fact, not be the ideal owner of a social media company.
Ps.
> 4. One AI engineer from Tesla could solve Twitter's bot and spam problem.
Do you really, seriously think this is true? It comes across as deliberately inflammatory, and you and I both know it's not true.
> Voicing your opinion in public has always carried the risk of being shamed or shunned
This is an argument in favour of a more liberal model is it not? Just not a centralized system that takes a dictatorial role in socially isolating people for having bad ideas. The analogy would make more sense if there was a benevolent gatekeeper blocking you from coming back into the public square (or even all big public squares) because you said something controversial.
Otherwise cultural free speech people want ideas to be openly challenged, not efficiently silenced by the system.
Harassing people is something I think most people agree crosses a line, in the same ways it’s a criminal act. But even here Twitter does a poor job at that by taking a very broad interpretation, for example it punishes people for publicly disagreeing with someone while also being popular, because their fans decided to brigade a person, then banning the parent for ‘causing it’ (without ever directly encouraging or supporting such a thing).
There’s a hundred ways to do this better than Twitter/Facebook/Reddit without throwing the baby out with the bath water.
Trying to accuse every person who wants a very limited scope for wanting Ayn Rand style anarchy is disingenuous.
Otherwise I’m not a fan of “All in” pod’s analysis.
> the board also has a responsibility to protect minority shareholders from people exactly like Elon [...] they may quite reasonably believe that a vainglorious egomaniac who has been repeatedly sanctioned by the SEC may, in fact, not be the ideal owner of a social media company.
This was covered towards the beginning of the podcast. Legally, the role[1] of the board in this situation is to get the best stock price, and not about the future fate of the business.
I don't really understand how this "poison pill" is legal. Imagine that you own a stock that can be sold at free market at $10/share. Then the board decides that whoever buys those shares will have to resell them to board members at $1. This means that now the price of those shares drops to $1 and you have lost $9 per share. How this can be legal?
That’s not the way it works. So of course it sounds illegal because you’ve made up an illegal scenario.
When the board triggers this clause, they may sell shares to existing shareholders at a discount. These are new shares. Companies have every right to sell shares outside of the exchange they’re listed on… and they do that all the time, through employee grants or options, for example.
When raising funds they generally sell new shares on the exchange, because that’s the highest price they can obtain for the share.. but they don’t have to do that.
And yes, in case you didn’t know, companies can sell as many shares as they want.
There must be some expectation about the rate of share issuance, I think that's what the parent comment is getting at. ESOP pools are well understood (and IIRC defined upfront). Threatening to sell massively discounted shares equivalent to existing shares without even so much as an SEC filing about it (as of a few hours ago), that's the part where it becomes questionable for me. If the new shares are marketable, then this is a defensive measure that actively destroys value for all existing shareholders.
A company cannot issue unlimited shares without concern for existing shareholders - taken to the extreme, doing so reduces the value of all holdings to zero.
Why doesn’t the board just issues shares to existing holders whenever Elon goes over 15%? You effectively dilute Elon out of getting over the 15%? It seems like the only difference with the poison pill is that you have to pay a discounted rate instead of getting new shares for free. But if the company can issues discounted shares to prevent a takeover why don’t they just issue free shares to prevent a takeover?
For example, if Elon goes to 16% ownership why doesn’t the board just distribute new shares to existing owners pro-rata to the point where Elon is back to 15%?
All of this seems pretty sketchy to me. I don’t see how the board is legally allowed to do this.
A company can't pay a dividend to some shareholders but not others. This action would effectively be giving in-the-money call options to some shareholders but not others. Probably legal, but pretty dodgy.
Thanks for the links. Goodness what a mess of a precedent.
Having the board ignore a large shareholder would be one thing. Shares give votes, and terms don't turn over every day, and we don't kick out politicians as soon as the polls turn sour on them. Fine. But if a shareholder has enough shares to change the board composition (or just threatens to) the incumbents can just unilaterally decide that the challenger owns a smaller fraction of the company than they bought on the open market? Maybe it's not technically self-dealing, but it's bad.
Poison pill shares are new shares, issued by the company and then sold to existing shareholders (with the exception of anybody who owns more than say, 15%). Since these shares are sold at a discount to the current market price, it is arguable that existing shareholders are benefiting as they now get more shares at a cheaper price, while also screwing over anybody who is trying to get >15%.
Now, you may argue that it is in the best interest of the shareholders to allow the hostile takeover to go through, but it appears that the strict mechanics of the poison pill do not immediately hurt shareholders.
Actually yes, this is often called "dilution", and it's common in companies that are raising money by selling stock. I'm sure there are complicated rules about when it's allowed and how much is allowed, but I don't know what they are.
They can always do that, by just issuing more shares. In fact, if you buy X shares, the percentage of the company you own could well decline over time. Or increase, in the case of stock buybacks.
If you've ever wondered why corporations have authorized and issued shares, there you go. Increasing the authorized share count requires a shareholder vote. Issuing shares under that cap does not. When shareholders increase the number of authorized shares, they are delegating that decision making to the Board.
It wasn't always like this. But as finance sped up, particularly towards the end of the 19th century, a railroad company which had to hold a shareholder vote to raise emergency equity because their free banking deposits in Nevada went bust would find itself systematically outmaneuvered by the ones who had pre-approval to plug the hole. As a result, most corporations now authorize the maximum number of shares reasonably possible, in almost all cases only moderated by some states' franchise taxes varying by number of shares.
So far I've tried to understand the poison pill and there aren't any satisfactory responses, either on HN or elsewhere in the news.
Wikipedia of Shareholder's Rights Plan is skimp in details as well.
Everything I hear ostensibly appears to be "That should be illegal, makes zero sense". So with no good information out there, it seems like no one is an expert at this and making up bullshit.
I'm interested in this assumption that because you do not understand something, no one else must either. Is this a heuristic you apply to all fields of knowledge, or just business law?
Yes, but that mechanism - issuing and selling new shares - brings in additional external money to the company so that afterwards you own 8% of a bigger pie.
Where do you think all the shares companies offer employees come from? They just make new shares. There is nothing illegal about this as it does everyone equally.
Maybe you are right, but the instant price of stock will probably fall down after "dilution", so for example if you had $10 000 worth of stock before dilution, and you want to sell it the next day, you probably will get less than $10 000 because now there are more shares available in the market (more supply, but the same demand as yesterday).
No, it is wrong to assume that the instant price of the stock will probably fall down after the dilution. It might fall, but it might as well increase, which often is the case, since the company as a whole literally become more valuable (influx of new cash on the balance sheet for the issued shares) and it just gained significant extra working capital that it can use to expand operations.
In this case you rely on a functional rational market in ideal business operating conditions.
If I issue more stocks for a meme stock at the height of it's popularity it will likely go up in price for reasons completely disconnected from the balance sheets and future revenue.
Conversely, if I recently started the process for bankruptcy and issue more stocks to cover the liabilities on my balance sheet, the stock could very well decrease disproportionately to the number of issued stocks.
Stocks at the end of the day are based on the market's perception of the stock's worth. The market is not a single rational actor, rather numerous small irrational actors and a few very large highly rational actors. Obviously there is a spectrum in between, but the ratio of buyers on a given end of the spectrum will influence the behavior of a stock to either align or diverge from the fundamentals of the company, and not always in the way you would intuitively expect.
Imagine there are 1000 shares and Elon got 150 of them, bought at $50 so he owns 15%. If the board now sells 1000 new shares to people who aren't Elon, he now only owns 7.5%.
Yea but that creates downward pressure in the shares too, so there’s a natural limit. Elon could just keep buying more and the market value of the company won’t change. If it did change I.e. you could issue more shares without changing the value of the asset you could just do that all the time from the standpoint of the company and raise infinite money.
So it’s a question of balance. Twitter can raise the fundamental value of Twitter a little bit but there’s no way they can raise it too much without driving the price down and then just having more shares available at lower prices, so like you could just buy 2 shares and spend the same amount of money.
The board can issue new shares (equivalently, diluting existing shares) if it thinks it is in the interest of the shareholders. That’s clearly what they think of the poison pill, but it’s harder to argue that for the hypothetical you are describing
We've suspended your Twitter account for violating Twitter's rules against attempted hostile takeovers of Twitter.
Your account will remain suspended until you withdraw your bid to purchase a majority stake in Twitter. After you withdraw your bid, your account will remain suspended for a period of 1 week. Further attempts to interfere with the ownership or policies of Twitter will result in permanent suspension.
Previous media ownership rules would have prevented Twitter from existing at its current scale. This was explicitly to prevent too much editorial control from becoming too concentrated.
Regardless of whether Musk buys Twitter, the long term trend is likely to continue, at least until one party decides to stop it. (Consolidation was largely driven by rule changes made by the Regan, Bush, Clinton and second Bush administration. Other factors have accelerated it since.)
E
Edit: I have a hard time having much sympathy for conservatives on this particular issue, since some rule changes were timed to allow conservative talk show networks to buy up large swaths of the US market, and also wre designed to allow Fox News to exist as a "entertainment" (obviously biased news) network. Having said that, liberal propaganda and conservative propaganda have the same root cause.
It's telling that the proposed "solution" to Twitter having censors is to let Elon Musk be the censor instead. The only thing that has worked in the past is decentralization of the news industry, but no one is calling for Twitter to be broken up. I guess both sides want it to exist so they can control it.
My prediction is that Elon will have sold a majority of his stake in Twitter soon, netting him a huge gain before the dust settles. And he’ll likely get a small symbolic fine again for his blatant market manipulation.
Yes this unfortunate lie will be crowed from the rooftops that Musk is just manipulating the market when he in fact has zero history of actually caring about making money on the stock market.
yeah his favorite pastime seems to be pump and dump, not sure why people continually believe whatever bs he sells when he does stuff like this... Elon Musk does not give a flying fart about free speech
That's how the game is played. If you want to take over a company without the consent of its executives, it's going to be a fight and you're probably going to lose.
The board of a public company cannot reasonably claim that they’re worth twice(!) what the market currently values their company at simply because they feel it’s true. Unless they have advertising contracts and growth metrics in the pipeline that represent a reasonable doubling of revenue and value, they’re acting legally irresponsibly. Justifying this is difficult. This is objectively a good offer.
Somewhere between 50% to 100% is the standard premium in all such acquisitions. As it stands Musk is offering 17% extra. Of course that takes the existing bump that the stock got from his initial purchase into consideration, but investors already have the ability to cash out at the current price so that lessens the attractiveness of the offer.
No, they don't really have the ability to cash out at current price. Maybe the smalltime investor but if any large institution tried to cash out the share price will tank. Just like it will tank when Musk ends up selling his shares.
Twitter has the potential to be much higher than its current value. It’s currently at a zero-earnings pricing. I don’t know whether Agrawal will turn it around, but if Elon or somebody like him stepped in, maybe they could clean house and do it. If Twitter employees are freaking out right now, it’s because they have so many people doing stuff that isn’t bringing in money.
I think the board is right to reject the offer. Twitter could be worth more. Twitter in Elon’s control would be a more valuable company.
If I were a shareholder, I’d want them to reject 52.40. Maybe not 92.40. The ideal outcome would be if Elon gets 51% control and I got to remain a shareholder.
Well, Twitter is 16 years old with $5 billions in revenue. Their maximum was ~$70 per share and that was 1 or 2 times. I don't think 92.40 is even reasonable since you have incumbents ranging from IG to tiktok.
Heck, Tiktok could add a timeline just like twitter and decimate them since Gen Z and millenials (26 and younger) are basically there. Facebook is old school and will start slowing down going forward. IG is for business since the appeal (sharing photos with friends) has been lost. Snap has its niche and Gab, Gettir, etc... are catering to the right.
People like controversy and that's the main reason twitter is relevant. Left and Right like to expose each other. That's the main reason alt-tech is not mainstream.
Apparently it's lower than the current 52 week moving average of the stock price, so I don't think it would be outrageous to claim it's a low offer even without some massive deals in the pipeline.
They will claim whatever they need to claim to justify not taking the deal. Like I said, it's how the game is played and completely standard practice. Lawsuits are also standard practice, which is why board members have insurance.
I think that clause has to be administered within a few hours and that time has already passed. It may be necessary to amputate a portion of the company.
Wow, my prediction is Musk will walk away, Twitter stock price will tank, and Twitter will be flooded with thousands of shareholder lawsuits (for breaching their fiduciary duty).
As is detailed by many smart people below, fiduciary duty lawsuits are difficult to win. They'd pretty much have to have board members emailing each other saying "This would be in the best interest of shareholders, but let's screw them over instead"
This was an epic debacle. Musk invested 4 BILLION dollars in an asset of questionable value, because "free speech". If he times it right he could come out ahead financially. But in general this was a pointless distraction and public fiasco that served no one.
I have no idea what he was doing or what his goals were. It looks like he was upset that people he liked were getting banned by twitter and was afraid that he'd run afoul of their rules himself, so he tried to buy the company. And despite being one of the richest humans to ever live, he failed at that.
This is just a head scratcher and a massive L. I don't see another way to view it.
from what i understand it's a matter of ideals combined with the technologist's desire to see the machines (all types, including sociopolitical) work correctly.
he wants to see the first amendment function with autistic precision. he wants to remove any messy personalization because it interferes with that purity. he wants fully transparent moderation and proof of fairness. he doesn't like the idea that one organization has such control and he likely wants to turn the company into a dao. he's searching for a problem to apply cryptocurrency technologies to.
what i think he doesn't get are the messy realities of the real world. we're already on the cusp of world war iii, can we chill for just a few minutes?
I have this recurring fantasy in which some Satoshi figure creates a decentralized global bulletin board, such that anybody can post and view anything anonymously and untraceably, and nobody - not the U.S. government, nor the CCP, nor the Mossad, nor the NSA - can stop it short of dismantling the whole Internet and starting over. Nobody can blame anybody, because nobody can stop it. Not because I think such a thing is technically possible. Certainly not because I have any fancy argument for why such a thing ought to exist morally! But simply to sit back and watch the world lose its fucking mind over it. To see the whole psyche of human kind projected into public view, and the accompanying apoplectic, impotent outrage.
I might also settle for a really quality sci-fi novel in which this takes place.
This already existed, it was called Freenet[0], and it was just as much of a trash dumpster as one might imagine. I have no idea if it still works.
The fact of the matter is that such a system absolutely would not scale. USENET crumbled under the weight of early 90s AOL subscribers; imagine even a fraction of today's Facebook or Twitter users moving to a similarly open system. It would be absolutely unusable chaos.
The thing is, these systems are not "the whole psyche of humankind projected into public view". That's far, far too generous for it. What usually happens is that the loudest extremists scream over everyone else, sock-puppet support for each other, create an echo chamber, and then proclaim that everyone who doesn't think like them isn't a real human being. The vast majority of people do not actually interact with the system.
[0] Technically speaking it was some extra overlay software on top of Freenet. I don't remember the name.
No, it isn't impossible at all. However, it would be very subjective- like that Freenet overlay software that eliminates SPAM and child pornography with ease, such a system would be more based on subjective webs of trust and optional lists people could subscribe to, used to determine what you see.
The sender anonymity part could just be having every node act as part of a mixnet- wait until you receive X messages and/or Y time has elapsed, shuffle messages, send them out to randomly chosen nodes, repeat this for 3 hops and then your message is propagated.
I've wanted to make something like this for ages since 4chan has gone so downhill. Perhaps it should happen then. It would probably be easier to adopt than something as complex as Freenet FMS for sure.
I would most of all hope it would solve the problem of people asking such questions, by making them perfectly moot. Folks would be forced to settle for wistful speculation about what the world might have been had the thing not been created.
Trolls would need to avoid being too overtly inflammatory, lest they get blocked by kneejerk reaction.
> What problem would it solve
Well, we could have a bunch of discussion boards again, ones that aren't at the permanent whims of profiteers or atrocious moderation. And strong anonymity even against global passive adversaries. Clearly there is a case for it, I know a lot of people who would find lots of joy in such a thing!
Freenet was also slightly slower than molasses in Antarctica. You had to really want to post there. The product of a messageboard is roughly:
sum[user_i in users](opinion(user_i)•engagement(user_i))
It's the second factor that causes all of the problems. But much like fast-food companies get a large fraction of their revenue from a small fraction of their customers, social media companies have trouble disempowering highly engaged users when functioning as a profit-oriented business.
It's interesting to consider what would happen with a "less moderated" messageboard where an individual's daily engagement is capped (supposing you solve the multiple account problem). It doesn't seem likely that we'll see that any time soon, though.
Somebody writes a unlock euqivalent and maintains ban lists. Everyone subscribes, because otherwise it's full of ads, spam, and edgy 14 year olds repeating slurs like it's Xbox live.
That doesn’t break my vision. It’s not the whole Internet, it’s just one bulletin board. People can not go there at all if they don’t want to. If Twitter’s moderation was chosen by each user, for themselves, we wouldn’t have this conversation (though no doubt we’d be having a different one). People filtering for themselves doesn’t touch on what I’m getting at with this thought experiment.
There are plenty of unmoderated corners of the internet; always have been, always will be. They were fun when the internet started out and when the financial incentive to spam the everloving shit out of them was low, but that's not really the case anymore.
it's a false projection though. it wouldn't be a projection of humanity -- it would be a projection of humanity warped by the games that would emerge as generations learn to cope with anonymous hyperconnectedness.
it's not some mirror that reflects who we really are, it's the chaos that comes from navigating entirely new paradigms of attention games and connectedness at scales we haven't yet evolved for.
To see the whole psyche of human kind projected into public view, and the accompanying apoplectic, impotent outrage.
Brilliant!
Can’t help but wonder if over time – having the ability to peek into our collective psyche – this would trigger a significant divergence from the present evolutionary trajectory of our unexamined collective mind; maybe for the better, maybe for the worse.
So it was 4chan before they made enough trouble to get law enforcement attention. In the beginning it was just a bunch of pissed off nerds posting anime that no one took seriously
It wouldn't be any kind of transparent window into the human mind.
It would be like any other lightly-moderated or unmoderated spaces we've seen before: the wildest days of 4chan, etc.
It would quickly be dominated by niche individuals and clumps of people who are good at attracting attention because they yell the loudest, are the most outrageous, tell the most compelling lies, etc.
Preventing SPAM requires a lot of subjectivity, so particular people who download certain sets of posts are more like to be senders. Perhaps retrieval of messages could be routed over something like I2P.
> he wants to see the first amendment function with autistic precision
I really wish we'd stop defining social media broadly as a first amendment issue. Elon Musk has the right to speak his mind without fear of government reprisal, he doesn't have a constitutional right to broadcast his asinine opinions to millions of people.
I'm not getting the impression that his actions are the result of a highly polished corporate public personna, I think his actions make way more sense if you imagine that he's just some regular, kinda bright, really eccentric asshole with more money than god.
Like, you can probably imagine at least one person you know acting this way if they discovered a genie.
Holy moly - reading that article I never knew the British caver's lawyer was the same completely delusional Lin Wood from the idiotic "kraken" lawsuits. No wonder he lost the case.
You should do a google search before posting on HN. Dude's done tons of really mean, rude, or questionable things. At many levels. It's not on the OP to prove it to you with exhaustive sources or whatever when you can just look around you and get examples.
I find it pretty ironic that the Hacker News user calling someone a douchebag goes on to provide what amounts to a "Let Me Google That For You" (lmgtfy) link.
If I came off as calling someone a douchebag, that's my bad - I've reread my comment and don't see that there, but if it happened I'm sorry. Could I re-word it somehow?
My main point was that saying "nuh uh" isn't a substantive rebuttal to a claim, especially when there's a pretty solid wealth of evidence in both directions (Musk has been a real turd to some people, specifically unionizers or laborers in his domain as well as that one anti-submarine guy who he leveraged his wealth to slander as a paedophile, but has helmed pioneering work in battery tech, propulsion, and non-government viable (!) approaches to lots of technological hurdles).
So, given the context of him being a known polarizing figure, "what has he done to deserve 'asshole':(" is not a substantive comment. LMGTFY is appropriate here, if anywhere?
There are very few things you can do that are a bigger asshole move than calling the person who bravely rescued a bunch of children a pedophile because you didn't get to be the hero.
Not to defend childish Twitter name-calling, but the reason he did it was that the dude picked a pointless fight with him first. Let he who has not escalated an insult battle throw the first stone.
No, they are addressing two different things. The second half addresses the parent assertion that he did it simply out of spite over whose cave rescue solution worked out first.
You may not be personally deafening him, but you are certainly offering a possible defense. So while you say "Not to defend childish Twitter name-calling" , you are also offering a possible defense for someone calling another person a pedophile without cause.
I might be misremembering the sequence of events, but I thought he called him names because the said hero publicly told Elon to shove the microsubmarine he was trying to build into his ass. Which kinda changes the picture entirely, at least for me.
Not really when the "microsubmarine" solution was never going to work and every minute was vital to get the kids out alive. So more of a "piss off and let people who actually know what they're doing focus on the job"
And regardless of that, it is still a massive asshole move to call someone a pedophile because they told you to shut up. Those two insults couldn't be more different in severity and social implications.
The pedo thing makes you an asshole. You can still have virtues while also being an asshole. I'm not really sure what there is to discuss on that point.
Every billionaire is supposedly an "asshole" and the only reason is because they have the money to do all of the things that regular people would also do but pretend they don't because they don't have the power to do anything.
The fact that nature places constraints on ordinary humans’ worst instincts is probably a good thing. We’re all fundamentally egomaniacal idiots who would do stupid things if granted absolute power. The fact that our society has granted a few PayPal co-founders something akin to such power is not a strong argument that such power is a good idea.
Yes, I don't have a reddit account either, because both here and reddit are very pro-censorship. I do understand though that your comment adds no value and should supposedly be downvoted according to the community standards of this site. My point is not a troll, it is always the case that people who have no power pretend that <if you just give me the power> I will be the <really good person>. They just want power like everybody else.
Well, you're technically right in that pointing out obvious trolls is discouraged here; instead, let's be charitable and take your comment at face value then.
> Every billionaire is supposedly an "asshole"
I don't know if this is true; I think some have a pretty strong image in the public eye. Gates for a long time hit that mark, though the COVID vaccine era allegations work against him now. Musk himself - case in point - is polarizing, but beloved by many. Buffet AFAICT is seen as a kindly, humble market guru with a penchant for helping those who need it. The Kardashians' (specifically Kylie Jenner's) wealth is admired and lauded by many. Tony Khan is ranked highly in sentiment across billionaires, and even the polarizing Vince McMahon is well beloved by an adoring group. Donald Trump, who is maybe a billionaire?, is the actual locus of much attention, merchandise, and adoration, of a large portion of the USA. Mukesh Ambani is a respected and admired figure in India. I don't know what the burden of proof to countermand this is.
> the only reason is because they have the money to do all of the things that regular people would also do but pretend they don't because they don't have the power to do anything.
This seems wildly, unsupportably reductive. Could you back this up with anything? I've engaged with the thought for a bit and am now more genuinely curious that I was before, so - W there for the HN zeitgeist, probably.
> I do understand though that your comment adds no value and should supposedly be downvoted according to the community standards of this site.
Maybe, maybe not. I'd rather call out a troll and help others see it if it'd otherwise fly under the radar and scum up conversation.
> My point is not a troll, it is always the case that people who have no power pretend that <if you just give me the power> I will be the <really good person>. They just want power like everybody else.
This is completely unfounded, and - to me, very subjectively - sounds like projection. I vehemently do not want unilateral power, but I also don't want others to have it. Where do I fall on your political compass graph?
An L for Twitter inc, perhaps. OP did not say shareholders would win their lawsuits. Elon obviously has zero interest in a financial return. It's clear he genuinely believes Twitter could be better, especially around free speech.
I haven't seen anyone convinced one way or another based on these recent events that wasn't already; in other words, this offer changed no one's opinion. If pointing out that you think there's an issue to other people who already believe that issue exists is a win, then sure, he's already won.
Just look at the conditions in any society without free speech and you'll find your answer.
More abstractly, free speech is required for free thought. Without free thought, we're all thought prisoners to whomever controls the information we received. Musk's contention with Twitter is that they have been positioning themselves as that entity.
I'm not aware of that term being propogandist. Maybe I heard it somewhere, definitely possible. Do you object to the image? It seems perfectly fitting which is why I used the word.
In the recent Ted talk Musk talked about needing AI-complete solutions for projects like full self-driving and Optimus (tesla bot) to succeed. He also wryly mentioned that there was a plan b if his Twitter bid wasn't accepted.
He's heavily invested in AI and machine learning, could he be interested in twitter's data?
He could just give them money for it. I'm sure they'd love having a multibillion dollar customer.
It's very possible that his AI investments have yielded developments that we can't imagine. But it's hard to see the value of twitter's data over that of, say, the internet cache that gpt-3 uses.
Sure he could pay for it, but buying the company (and taking it private) is potentially a way to get paid for access. Web archives - like common crawl - are snap shots of the past, but twitter users react and discuss events in real time.
Reliably parsing and interpreting new, potentially unreliable data is part of that whole AI-complete thing.
I think he's more interested in the power of twitter as the public square. There's no doubt Trump won his presidency through that social media presence (and his non-stop rallying of course). That kind of power is more useful than say buying the Washington Post.
I would be more interested in him implementing certain features like a journalistic credibility score for outlets and individuals. Base it on number of retractions, mistakes, and outright lies. Surely a score like that might put certain fake news propagators in line.
This is something he pitched before although as a standalone website. Integrating into twitter seems more useful.
> I would be more interested in him implementing certain features like a journalistic credibility score for outlets and individuals. Base it on number of retractions, mistakes, and outright lies. Surely a score like that might put certain fake news propagators in line.
Which then raises the issue of who scores the scorer. You already have people throwing fits because the garbage they post gets labeled as misleading or not true. So how would this be any different besides you liking the person in charge of the scoring?
Could be done with ML perhaps, or via consensus. I did list retractions for that reason, as there is a point where even an outlet needs to admit they got something wrong, but burying it at the bottom of a year old article no one will ever see is a dirty move. Either way it's not my problem to solve, just something I would like to see.
After considering it for a bit, my opinion is that it's mostly a political ploy; if he buys it, he'll bring back Trump et. all, expecting that once the GOP is back in power, they'll make any trouble he may be expecting with the SEC and the National Labor Relations Board go away
I think there are probably other factors at play too. His ego, of course. And also the general desire, also evident among VCs like Andreesen, to discipline the Silicon Valley workforce and remind the uppity code-monkeys who's really in charge.
It's really fascinating seeing all the conspiracy theorizing going on with this offer. You have a number of really creative threads going on here.
To step through this... So we have someone with a net worth near 300 billion dollars that is going to go through all this trouble to:
-Unblock one user
-Which will then trigger an American political party to like him
-This political party will then make it less likely the SEC will bother him, potentially saving him tens of millions of dollars (or 0.01% of his current net worth) in some hypothetical scenario
What a theory! This same political party and twitter user was in power when the SEC fined him+Tesla $40 million in 2018. How do you make sense of that with your theory?
If politics was his main driver, why wouldn't he just use his wealth to directly incentivize politicians?
I don't think it's a straight quid pro quo or that he's on a secret Signal chat with Trump or anything. Just part of a broad alignment of the tech oligarchy with the Republican Party on anti-labor and anti-regulation lines.
Again, why would Elon Musk, with net worth near 300 billion dollars, go through all this trouble to maybe save 0.01% of his net worth in fines in some hypothetical scenario? The ROI seems absolutely terrible for that theory.
And why when Trump and the Republican party was in power in 2018, did they allow Musk+Tesla to be fined if there is such a tight relationship along 'anti-regulation' lines between the SEC and the President/political party in power?
And again, if he cares about political influence, why go through all this trouble and why not just directly incentivize politicians?
I think 2018 is exactly the kind of thing he is trying to avoid; I think you are underestimating the impact vigorous enforcement of labor and securities laws would have on his business prospects. Elon and his companies of course also spend quite a lot of money on campaign donations, lobbying, and political activity.
I think this is probably only one factor at play here, and who really knows to what degree, but it's certainly more of a factor than marketing pablum about Elon being a futurist deeply concerned with the optimal future of humanity or whatever.
None of my questions have been addressed, so I'm guessing you are pretty deep into your theory. I do wonder whether there is any piece of evidence or logical thinking through probabilities/incentives that would alter your theory of "Elon Musk buys Twitter to curry favor from Trump & the Republican party"?
Would the fact that Tesla mostly just donates to Democrats alter anything [1]?
Or that Elon Musk makes more personal donations to Democratic politicians [2]?
I'm guessing not. I'm guessing you'll ignore this and see that he and his companies donated some money to Republicans (even though he gives more to Democrats) and that therefore means he's a diehard Republican who is driven to look out for the party.
That he also donates to Democrats does not seem at all fatal to my speculation, as many avowedly right-wing (in the economic sense), anti-labor, anti-regulation businessmen donate freely to both parties. You seem to have some very confused notions about U.S. politics and political economy more generally.
-Is CEO of an electric car company and produces solar panels to help mitigate climate change
-Donates mostly to Democrats personally and through his companies
-Did not donate to Donald Trump, and said "I feel a bit stronger that he is probably not the right guy. He doesn't seem to have the sort of character that reflects well on the United States."
-Was fined by the SEC when Trump & the Republican party were in power in 2018
-In June 2017, announced that he would be leaving Trump's business advisory council in protest of the president's pulling the U.S. out of the Paris climate agreement. "Climate change is real. Leaving Paris is not good for America or the world,"
-Has a net worth of nearly 300 billion dollars
-------------------------------------------------
Wants to buy Twitter for $43 billion, because:
-It'll curry favor from Trump and the Republican party
-And if elected, Trump/the Republican party will make it so the SEC is easier on him (even though they were in power when he did get fined before)
-In a hypothetical scenario where he would get fined, this preferential treatment could save him 0.01% of his net worth
You are right, I am very confused, and this has to be the end of the thread for me. I do like probing conspiratorial thinking, but I think we've reached a dead-end. I bid you adieu.
Yes, I think he likely regrets his previous public positioning and is adjusting. I think, as I said, this is part of a broader shift in the tech-ocracy towards more explicit anti-labor and anti-regulatory positioning, and I think the potential risks of vigorous securities & labor law enforcement to Elon's wealth and personal freedom are likely substantially higher than the slap on the wrist he received from Trump's SEC (which, you'll remember, also imposed some mild restrictions on his ability to Tweet, which clearly irked him far more than the fine). I also don't think a billionaire with a California-based business donating to Democrats is at all fatal to my little theory here, as plenty of right-wing anti-labor, anti-regulation plutocrats donate to Democrats if they think it is in their material interest to do so.
Given that this is your second attempt at quitting the thread with a pre-emptory sign off, I would like to apologize for agitating you so much with my idle speculation here, and I sincerely hope you're able to make this attempt stick.
Let's be specific, "pedo guy". And that was an insult in response to an equally profane insult from the other guy. Two wrongs don't make a right, but he apologized and people who have said equally bad or worse things also occupy high places...
I think you again have missed the point that it was not an unprovoked comment. It was in response to another insult. I don't know how betting money on an insult makes it not an insult. It's one thing to attack someone because they dislike you or it's not provoked at all. It's another to respond to an ad hominem with another. Nobody is disputing he went far overboard than he needed to, and that his position gives him dangerous influence (as with many celebrities). In the end he deleted the tweets and apologized. Unless you have reason to believe that it's insincere, I'm not holding weight on a war of words.
What it emphasises is the need for self-moderation especially when your state of mind is in fight mode. The mistake here is Elon's stream of consciousness doesn't stay off of twitter for his own determent. That is not an inherently malicious thing. People get into arguments all the time and say stupid regrettable things in the moment. Playing out on the internet--especially with a big power dynamic at play no doubt is bad. But let's not forget we're not robots here--hence we're not sending people to jail after arguments.
Yes Elon is known for manic states, it's not a new detail. The legal discovery process is basically also "digging up dirt", and both sides do it before a trial to bolster their cases. That doesn't imply malice (as in, wanting to harm someone aside from mocking them), which is also something for a jury to determine. And a jury decided, unanimously after viewing the totality of the case, that the comments did not amount to defamation.
> he didn't apologize
> He said in court that insisting somebody is a pedo is a common playground insult in Africa.
Apologizing and making this clarification are not mutually exclusive things.
Let's keep emotion away to understand what's happening. You emphasise the alleged hate and are regurgitating the private investigator points. He made an accusation as an insult. And dug in on it, on his own FU money, to not lose the argument. It's not right, but missing the crucial context before and after: he was not the instigator, and he apologized for it after.
> Are you implying it is okay for Elon to make false child rapist accusation?
People say much worse than "pedo guy" in arguments, although this is subjective. In a response to another insult, I'll mark "Sorry pedo guy..." as an informal childish remark, not a sober threat with the intent to harm someone.
> Nobody said they were mutually exclusive.
> I am saying that he didn't apologize.
I don't understand what you're saying here. This means he can apologize for and also clarify the context behind the insult. So far, his last words on the topic in sworn statements are that he didn't mean the comments to be a statement of fact and apologized.
> Second the diver had to prove damage, which was hard to do.
They had to prove if a reasonable person would take the statement as a fact of matter. Whatever dirt he dug up with an investigator is something that happened after the fact, and private comments he made digging in are self-inflicted collateral damage, not preceding the comments in question.
> I have no idea how his general trait is relevant with this specific event.
The totality of the case also needs to mention the context that he was trying to help, on his own dime, children who were trapped underground. It doesn't make his comments right, but taking statements at face value lacks human context.
It will lower the value to institutional investors that they pulled the “poison pill” move, because it means that management is entrenched and they can’t remove the board if they needed to. Elon isn’t the only one who is barred from buying a controlling stake in the company.
$TWTR has been trending down over the last year. When he bought, the price went up 27%, signaling that people thought his involvement would be positive for the company. If he says "twitter is hopeless" and pulls out, the sentiment will be that nothing can save twitter.
this is incorrect. the price going up is a reflection of the market's believe about the % likelihood of a deal.
for example at market close of $45.08, the market is betting there is a $45.08/$54.20 = 83% chance that this transaction goes through.
there are certainly individual stockholders who are buying because they like his involvement, but that is tiny compared to people buying and selling a very near-term bet
Correct, and furthermore, Musk's offer was made after he announced his stake in the company, which is what caused the price of the stock to rise. Him offering to buy it outright barely affected the share price:
> The social media company’s shares were little changed at $45.81 in New York on Thursday, a sign there’s skepticism that one of the platform’s most outspoken users will succeed in his takeover attempt. -- Bloomberg
So while the news of a major stakeholder with the power to join the board and affect how things are run did cause a significant blip in Twitter's stock price, the attempt to buy it outright doesn't seem to have affected things much. Even if we (incorrectly) assumed that all of the rise from ~$40 to ~$45 is associated with the possibility of Musk paying $54 a share, that suggests the market assigns only a ~36% chance of the deal going through.
yes, there are many factors that can influence a valuation. and in different price ranges, different factors will have different weights. since the price is not $0 today and is relatively close to the potential transaction price, the % likelihood of a transaction has much more influence.
I think the comment is more about the fact that your calculation of 83% doesn't make sense. However, I agree with you that likelihood of the deal going through is definitely impacting the short term valuation.
I keep seeing this sentiment, and it seems like wishful thinking.. The paper is out there on how to defeat the poison pill: trigger the pill, let the stock tank, offer at a lower price per share but at the same market value plus what was put into the company to acquire the new stock by the diluters. Full market price is full market price. Look at Musk's investment in automation at Tesla he knows how to play the long game. ttps://scholarship.law.nd.edu/cgi/viewcontent.cgi?article=1102&context=law_faculty_scholarship
If he honestly wants to buy it which given the hoops he's jumping through seems to be the case then it's not 'manipulation' at all. Every move Elon makes is going to change the price. I think we all know he's not 'in it for the money' so it'd be pretty hard to make the case for manipulation. He really wants it. And if everyone else thinks Twitter would be better off with Elon as owner the stock goes up. And if he gives up trying, the stock goes down. That's not manipulation, that's sentiment.
I also believe that Musk will walk away and the stock will tank.
Musk’s recent stock purchase and discussion about joining the board made the price jump significantly. You’re right that there’s no obvious reason that his involvement should change Twitter’s value, but the market appears to think otherwise. If he walks away, at a minimum, I would expect that the stock price will drop to what it was before he started playing around.
But if he walks away, I believe he’ll also do something to make the stock drop more. For instance, he’ll stop Tweeting, which should have a measurable impact on the number of people actually using Twitter regularly.
I’ve muted him, and I’m sure many other people have. Honestly if he leaves and that makes some of his fans leave too, I don’t see how that would do that much except for slightly raise the quality of conversations across the board!
> For instance, he’ll stop Tweeting, which should have a measurable impact on the number of people actually using Twitter regularly.
There are that many people whose engagement depends entirely upon whether Elon Musk is actively tweeting? I don't use Twitter much, but that seems pretty amazing if true.
You might be imagining the wrong model, its not the people that'll leave if Elon Musk does, but the entire cesspool around repackaging hot takes and reactions to his actions and tweets goes away too. I have a feeling its a lot of content that would dry up.
1. The possibility that Musk would bid for the company, nonzero before all of this, goes to zero.
2. The market observes a very capable businessman, after discussion with management, deems it incompetent and value-destructive.
3. Said businessman, with a track record of remarkable success in a variety of ventures and demonstrated skill with social media, may launch a competitor service.
All three of these are bad signals for Twitter's future cash flows.
Loads of people said that about Twitter in 2006 when it was a "knock off." It's been proven wrong again and again. And Musk is the kind of guy who can create significantly large network effects and economies of scale.
Twitter has never been a knockoff experience, it was as different from the social media that succeeded before it as TikTok is from YouTube.
Meanwhile any number of near-exact replicas of it exist with a different flavor: freer speech, paid service, decentralized, specifically for particular political affiliations to name a few. None of them have made a dent.
But that just proves my point: they didn't make a dent because none of them had the network effects and economies of scale that a proposed alternative created by Musk would have.
Facebook (the thing I think people will agree destroyed MySpace) was not started by someone fed up with MySpace saying “I’m going to make the same thing, but I’ll moderate it differently!” It was started before MySpace had reached peak popularity, by an entrepreneur with a totally different product vision and way of looking at the world. Elon’s hypothetical Twitter-clone would probably be more like Gab, Parler or the Trump thing: Twitter, but with less moderation and some sort of weird gimmick, like “starting midnight Tuesday, I’m giving a free Model 3 to the first 1000 people who sign up!” or “I’m hosting a quarter of the load on servers on StarLink satellites!”
Twitter won’t be destroyed by someone making a slightly different Twitter clone, it’ll be destroyed by something that re-imagines entirely in a way that also supplants it, and it’ll probably come from someone we don’t know yet.
There is definitely a network effect around scale and populations of users.
Gettr seems to be making positive inroads on the conservative/libertarian population, particularly those for whom twitter is not an option due to previous banning/shadow-banning, and de-boosting.
As I expect there to be consolidation between truth social, gettr, parler, and others, think this will only get stronger.
Part of this is also that younger populations are preferring tiktok to Twitter imo.
A lot of people in this thread share your opinion, but I'm a bit confused by it.
If the board acted against the usual shareholder interest (to make money) by turning down an offer 54% above premium, would it not be easy to claim that the board is not in it to make the average investor money on $TWTR?
Therefore, wouldn't the value of $TWTR as an investment be far far less than companies who do make it their primary goal?
That's not to even mention the 9% of Elon's stock that he claimed he would now sell.
Yeah but that analysis downplays the shareholders’ thoughts about the future. If they largely feel like Twitter’s real value is $100B, that it just hasn’t been realized yet, and that they think it can be realized, then it totally makes sense to turn Elon down.
In reality though, the shareholders are a giant mob of people with wildly varying views about Twitter’s place in society, its true value as an asset, its ability to achieve its true value, and just generally what the best way to “make the most money for the shareholders” is. So I don’t think it’s an open-and-shut case that the board betrayed the shareholders. It’s probably a muddy case that’ll play out in court over months or years.
It is the _directors_ making decisions here, not the shareholders. Those directors were chosen by management, and -- newsflash! -- they are beholden to management. They must jump through some legal hoops to discharge their fiduciary duties and protect themselves from lawsuits, but at the end of the day they'll do what management wants.
Does management want to maximize the value of Twitter? Er, no. Management wants to maximize some combination of their compensation, their agency controlling a company, and their social capital controlling a social media platform. Maximization of shareholders' value is a legal objective to which management must pay legal lip service, but it is not in any way shape or form the interest of management, save insofar as management compensation is related to share price.
If management cared about shareholder value, it would not have induced the board to enact this poison bill nonsense.
> It is the _directors_ making decisions here, not the shareholders. Those directors were chosen by management, and -- newsflash! -- they are beholden to management.
Shareholders can appoint, remove or replace directors, or even the entire board.
Twitter’s board doesn’t have any obligation to maximise short-term profits for investors (or maximise profits generally) - there has always been a misconception that companies/directors had to by law but the actual laws are much more general.
But at the end of the day, if the board thinks that Twitter may be worth more long term than what Musk is proposing to buy it for, then it’s perfectly reasonable to argue that it’s in the shareholder’s interests not to sell it.
Musk has basically hinted that he might sell his 9% stake if the deal doesn't go through. a selloff of that volume would definitely change the value of Twitter.
Companies are not required to sell to any random billionaire who comes by and offers a premium over the current share price. There will be lawsuits, and they will fail.
If Musk is sincere, he will turn Twitter into an 8chan racist hellhole. He has said he believes in absolute free speech. Racism, trolling, libel, dick pics, blatant racism are all fair game. He'd reverse Trump's lifetime ban.
Maybe Twitter was always doomed because it was just fad. But the idea Musk alone can save it is absurd.
Twitter’s speech moderation policies should be public, and all decisions pertaining to speech should be public, and there should be a public appeals process before a jury of the speaker’s peers.
That's a lot to ask when each user account is free.
You're basically replicating the US Courts Legal System, except those on trial pay 0% taxes. Not viable.
Keep thinking though, we need a hero of an idea to make forward progress on the question of what strategy is best for US-based public companies, and what their role is in showing the world what the gold standard for "freedom of speech" online looks like.
I like this description of the problem and the suggestion:
> Today on Twitter, as on most social media, justice works in a roughly Stalinist style. The normal penalty is permanent execution. There is no transparent explanation for why an account is executed, before or after the execution. It has simply “violated the Twitter rules.” The public rules are extremely abstract and could theoretically justify almost any execution. The private rulebook by which the secret police, or “Ministry of Trust and Safety,” operates, is of course as secret as everything about the secret police.
> Of course, it is easy to observe that a two-day-old spam account does not deserve a six-month trial, with lawyers, before getting the bullet it needs in the back of the neck. Due process in this context must not be a clone of the IRL judicial system, which is more broken than anyone can possibly imagine.
> And there is a simple solution to the problem of scaling due process: *scale the level of due process to the size of the account*. An account with a million (real) followers might well deserve a six-week public trial, perhaps even with some kind of counsel. The spammer with 20 followers? Any cop can shoot him, as at present, and leave the body by the side of the road as a warning to others.
> There is a use for online Stalinist justice—it is only an injustice when it is disproportional to the user’s investment in the service. When Twitter is your career and any cop can just shoot you, an eerie atmosphere of terror pervades everything.
This is why Twitter needs to go private. The current management has no idea how to run a public square without falling back to an authoritarian censorship regime.
EDIT: Arguably, much of what I am suggesting can be automated cheaply.
Private companies have less transparency than public companies. You're hoping the owner will be benevolent and okay with losing money indefinitely for the sake of transparency, or if that turns out to be the case - that ownership will not change (e.g. bought out by Murdoch or Carlos Slim)
You misunderstand, it’s true that a private company can be opaque, but a public company cannot be altruistic due to the composition of the shareholders. No one was able to prevent the Saudis from buying a major stake in Twitter, and the Kingdom is historically opposed to free speech.
A publicly traded company cannot solve this problem but a private company might be able to.
I understand you just fine - I was just pointing out that a private company can also choose to be opaque in a way public companies can't. It probably would have been easier for the KSA to buy a stake had Twitter been private. Incidentally, the infamous "Funding secured" tweet was predicated on funding from the Saudis[1]; so Elon taking money from the Saudi's isn't unfathomable, should he hypothetically choose to sell to them.
1. According to Elon, who now insists the tweet was true.
His character, along with his foil Chuck Rodes, trick people into knee jerking traps. The more "public" of a trap, the better for them. A lot of wall street plays in the show are based on real world plays. This article read like it came out of an episode.
If I knew the play, I wouldnt be sharing it publicly.
My whole point is, Musk made a series of public actions that made a stir. One action had the board make a knee-jerk decision that seems somewhat logical. He's jabbing with his left and the Twitter board seems to have hopped to their left and he's maybe going to uppercut, right hook, maybe go for a knee or do nothing at all and get hammered on martinis or mojitos or whatever a rich super villian likes to drink.
This is all a public side show for some greater end down the road or Musk made a drunk filing with the SEC. I dont know... well, all I do know is what's publicly available is pure propaganda to sway the public towards some greater play by someone who's going to profit off of this. I'm done with my poop now, find someone smarter to figure it out.
I just assumed that Elon had no actual plans to win this process, but rather use it as a way to first weaken Twitter before launching a competitor. The reason for this is because I don't see how someone can take over a company where, I assume, a large percentage of the core engineers actually want all of the censorship and so on, and have pronouns in their bio and all of that stuff to signal that they are on the opposite side to Musk in a political war. It seems like you would be leading a bunch of people that don't like you.
People arguing about one ai engineer point are missing the philosophical premise that spam and bots to some extent help with free speech and thwarting them are a form of censorship. Which would be antithetical to the argument of taking over for reasons of free speech.
First off, I should say I think Elon is the man. What he's been doing at "engineering" companies is of course absolutely incredible (go Starship!). But not so sure he should be mucking around with a social-networking/media company, in which messy social and legal rules are even more important than the technologies themselves. Yeah, his idea that free speech should be the overriding principle is at it's heart true, but tell that to Mark Zuckerberg and FB (as many of us here know, he originally was saying something similar years ago, that it wasn't FB responsibility to moderate content, but then it became known that many organizations and states are using bots and companies dedicated to promoting their own agendas. How do you stop something like this??). Free speech is an ideal that must be balanced with other ideals like protecting individual people & groups against defamation and libel amongst other things. Not sure an intense, engineering mind like Elon is the right person to wade into these very murky waters. And, have a feeling Elon wouldn't even enjoy working on a problem like this (as a software engineer myself, don't think I would either!)
I don't believe in nor really care about his points regarding "free speech" (whatever that even means, considering everyone has a different concept of it).
However I believe the current model of social media being funded by "engagement" has peaked, is hard to grow in a world already saturated by advertising, and is at risk from privacy & pro-consumer legislation slowly being enacted around the world.
I just don't see a future in the current model, yet the social media industry seems to be stuck in this local maximum without an easy way out. A hostile takeover of a large existing player by a risk-taker is the "kick in the butt" that the industry needs. It may go well, it may go wrong, but IMO it's at least worth a try.
You would be surprised, Instagram is showing pretty dramatic revenue growth over the past 4 years and it doesn't seem to be slowing down. Global expansion into developing markets will continue to fuel that 'funding' for social media companies. On the ad side, humans seem to be pretty ok with buying more and more and more stuff.
Good point, Twitter is a bit of a mess. hmm... But a huge worry is that Twitter has become such an important mass-media tool, and if he messes it up, it could become even more the goto outlet for politicians, autocrats, or even just businessmen with bad intentions to sway public opinion.
Yeah, as mentioned, Elon is a god, but in my humble opinion, his talents are in engineering (and Twitter just seem like a problem an engineer wouldn't even want to solve).
Agree, he's used to regulations. But, it's not just the legal rules, but the unspoken social rules we have as well as groups and factions he'll have to deal with. I could totally be wrong, but at least for me, I don't see him being good at or even enjoying fixing the problems of social-networking companies. Seems like a distraction from SpaceX and Tesla (which is more than enough)
Not well versed in any of this, but could this be Musk just toying around with Twitter and/or him bluffing to get a reaction? Does he have any legal obligation to go through with the purchase if Twitter was open to it?
Well (1) you can be sure Musk is paying lawyers $$$ to make sure he doesn't deeply fuck up on any securities rules given his contentious relationship with the SEC [though fairly that might be de minimus to him] (2) there is an opportunity cost to putting money so much money in twitter just for laughs [he could be doing other things] and (3) there is risk that the twitter stock could fall out from under him. (3) is really only a cost relative to having the money in a diversified portfolio - but it is a real cost nonetheless.
Anyone care to speculate what his plan B would look like? Could he make a twitter clone/replacement then offer existing members $50 for their username and password plus x amount of engagement on his new site?
Backup 1: Make a huge show of dumping 9% of the company at the lowest possible share price (that does not trigger any SEC scrut6). Deride the current board as inept and having no vision for the future of the company. Watch the price plummet and acquire the injured version for less than his initial offer. Admittedly that doesn't work as well with a 1 year poison pill delay the board just triggered.
Backup 2: Continue making Twitter polls that potentially steer/force the current management's hand into the changes he wants to see implemented regardless.
Anyone can make a Twitter clone/replacement. Getting hundreds of millions of users to switch over is more complicated than just handing them $50, and even that is logistically impossible to do.
Fair amount of irony in the exhange at the end. Twitter needs to be privately owned, so it can help usher in an age of cryptocurrency when everyone can own a piece of everything...
I wonder if there has ever been a similar attempt by a crowd instead of a single billionaire. For example all of Twitter users buying the company together. I read of some DAOs buying a football club before. Wonder how long it will take till we see a DAO taking control of a public company.
Also the idea of having potentially millions of activist investors in the same company is kind of unsettling but interesting at the same time.
I wonder what stops Musk from buying 14.8%, and then lending money to a few friends who each buy 14.8% and agree to vote in his interest? If there is just a gentleman's agreement between them, then he would not be considered the beneficial owner?
Then they could replace the board, repeal the shareholder rights plan, and the friends would pay back Musk's debt in Twitter shares.
This is such an obvious loophole, surely there is a legal provision against it?
I genuinely wonder if Elon Musk has friends, in the same way that you or I mean the word. I’m sure he has a great many people trying to get close to him, but when there’s such an obvious incentive for the other party I can imagine it being hard to trust anyone.
> Elon Musk is speaking to investors who could partner with him on a bid for Twitter, sources close to the matter told The Post. A new plan that includes partners could be announced within days, those sources said.
… But that pill may not stop other entities or people from acquiring their own shares of up to 15% of the company. Those owners could partner with Musk to force a sale, make changes in the executive ranks or push for other overhauls of the company.
> a limited duration shareholder rights plan, often called a “poison pill,”
> Under the new structure, if any person or group acquires beneficial ownership of at least 15% of Twitter’s outstanding common stock without the board’s approval, other shareholders will be allowed to purchase additional shares at a discount [until] April 14, 2023.
You can't press a button and buy that much stock. You'd likely have to buy from portfolios of hundreds of investor funds and family offices. Word gets around, and you'll have to jack up the bid with each successive call.
You'd also have to buy in large volumes on the public markets as well, so that'll bid up the price,providing a rationale for the board to reject the offer as undervalued.
But that doesn't seem any different to the process he would have to go through personally if he was allowed to obtain more than 15% himself without triggering the poison pill. I'm sure this makes it more difficult I'm just wondering, given the stakes involved, what is actually stopping this work around?
What's stopping the workaround you suggest is that the element of surprise is gone. Nobody knew that he was building up a 10% stake to take an activist investor stance, because he built up the stake slowly. But now we know.
And we know that for him to buy up enough shares to override the poison pill vote, he has to act much faster than he did the first time around. But the markets would be aware that he's looking to buy a much bigger stake, so existing holders can set whatever price they want.
Elon doesn't actually have the cash on hand to buy 51% of the company at market rate (he could release the equity from Tesla or something, but that would be expensive), he wants to do a leveraged buy-out which means we wants to get some other investors to go in with him on the deal at the figure he outlined.
Yeah that is in the same ballpark as (and probably more on the money than) my suggestion. If he gets a few more big shareholders on his side then he could simply put in proposals and sway the retail investors into following.
First of all, I don’t think they are reasonable. They’re crass and ill considered. Second of all, it’s not just about ideas, it’s about his personality.
Basically everything you’ve posted is wrong, and I completely disagree with.
Elon would do an infinitely better job than the current leadership, and I struggle to understand the mindset of those who say otherwise. I suspect they’re either ignorant or acting in bad faith.
> Twitter noted that the rights plan would not prevent the board from accepting an acquisition offer if the board deems it in the best interests of the company and its shareholders.
It's more like an insurance policy, it doesn't mean they're not going to sell if the offer is attractive enough.
“Even before Friday, Twitter had bylaws that "could have the effect of rendering more difficult, delaying, or preventing an acquisition deemed undesirable by our board of directors," the company said in a February 2022 SEC filing. That includes "a classified board of directors whose members serve staggered three-year terms," and the ability to "authoriz[e] 'blank check' preferred stock, which could be issued by our board of directors without stockholder approval and may contain voting, liquidation, dividend and other rights superior to our common stock."
Sounds like the board can do pretty much anything they want with Twitter’s stock. I find it incredible that a regulated public company can issue abitrary shares with any terms they want.
They made these rules before Friday. but it also sounds like they could have made them today if they wanted to.
That is insane. Was never a holder of $TWTR and never will be given these insane bylaws which allow the board to issue preferred stock without any accountability.
I think he should just use a fraction of the price and build a bot-free Twitter clone. He has such a massive following, which will quickly populate the new platform!
If elon owns twitter privately he can just go through his comments and ban the impersonators on the spot. He has complained for years about twitter not doing enough to stop scam impersonators. In fact he can ban anyone then. He would literally have that power. Conversely, he could also unban anyone. There would be no chain of command. Imagine using fakebook but then also having the power to ban anyone too. I think he may even be able to read private DMs or see accounts who blocked him. It could have national security implications if he can read Obama's DMs for example.
I think Elon just wants to destroy Twitter and he's just baiting them into tanking themselves, I have a hard time believing actually wants to own and run it.
If he did own it, I wonder if he would unban Donald Trump?
My favorite post I've seen about this whole thing is something like "Elon Musk desperately wants to be Lowtax and also want him to be Lowtax" and that got a good chuckle out of me.
I don't care about Musk or Twitter but I'm glad that somebody made a good joke out of this debacle.
Twitter has around 8,000 employees. I fully understand and respect the high level of technical skills needed to operate and manage such a highly available service, BUT I still can't for the life of me figure what the other 7,950 employees do.
One interesting point here. I noticed that Twitter bought a design agency a few months back [1] who themselves claimed to have dozens of employees. It made me wonder. Why would Twitter need dozens of designers on top of the designers they already had? I would have assumed they likely had a 10-20 person design team. One designer and a few managers for the handful of features they have. But then I read a post online that even back in 2014 they had north of 59 designers. And given their growth since then, they likely have hundreds of designers.
As a founder, engineer, and designer myself. I cannot fathom what 100+ designers do all day for an app like Twitter. They have to be working on so much overlap, and busy work.
I gave a try to Twitter's Ad platform recently. Mother of god, they've built a giant machine behind the curtains. It has terrible UX, but I could, if I wanted to, target a U.S. Military retiree that likes creole food, located in Boston, enjoys watching Golf and uses iPhone 11 Pro with an older iOS version 14. The profiling of users, and the ad-tech machinery is insane. There is a auto-bidding machine, detailed analytics, website tracking scripts, conversion metrics, the works. I had no idea. Imagine you build something amazing, but no one knows about it – how do you get that thing across people that actually want it? It is a hard problem and from my little experiment with their advertisement platform, it is miraculous. Surprisingly, I've not seen any article from mainstream newspapers that exposes what kind of a goliath Big Tech's ad platform is.
You ought to sign up and see it for yourself. Meta & Google's Business Platform is similar if not more powerful.
After this revelation, 8000 people entirely makes sense.
> It has terrible UX, but I could target a U.S. Military retiree that likes creole food, located in Boston, enjoys watching Golf and uses iPhone 11 Pro with an older iOS version 14
So, it's got lots of categories you can target. But...what evidence or guarantees are there of accuracy of the targeting?
There seems to be some misfiring because rate of likes isn't high (~1 like in 100 impressions), but based on the people that like the promoted post it is 100% without exception accurate. So, at the least, it is reaching the right people. I know because there are currently 500+ likes and I've visited every single profile and tried to engage with them. Audience is just developers.
I must say, it has been a very positive ad experience – receive compliments, 10% retweets, and had several long form conversations with strangers on Twitter messages. Really fun.
Surely the legal department alone requires more than 50 employees, considering all the countries they operate in I imagine there are many legal requests.
Generally, things get harder as you scale because something that would have taken a new Postgres table has become a distributed systems problem.
You also hit diminishing returns with new features and user growth, but when you have hundreds of ~~billions~~ millions of users, even marginal engagement gains can multiply out to something big, so you have a lot of teams working on features that might move the needle a bit.
There are also more regulatory hurdles as you grow, so some of the staff just support that.
Yes, things gets harder at scale which is why he said 50 and not 5. Depending on how much infrastructure code you do inhouse you add another 50 for managing that. If you have your own datacenters add another 100 or so if you have a few around the world. If you want world class recommendation add 100 or so data scientists.
That gets us 300 tech people to run the service.
That is for engineering, those numbers are roughly what I saw at Google for these kinds of things. Then Google typically has 1 non tech person per tech person, so add in at least as many people again. Then since Googles customer support and community management is hardly world famous for being good, rather it is infamous for being bad, you probably want even more non tech people than that. But still, do you really need 8000 people for it?
Allow me to ruin your now-traditional joke [1] by telling you what I saw when I worked there in 2016-7.
First, it's a complex product. Just for the user-facing side of things, there are four big codebases: back-end, iPhone, Android, and Web. The back-end stuff is very large, generally for good reason, and sometimes not. A lot of those good reasons relate to performance; with over 100m people using it every day, getting the right tweets to the right people is challenging, especially given that some people have over 100m followers and many users will follow a lot of accounts (I follow over 3300, for example).
But the user-facing side is only part of it. A big way the site makes money is ads. This is in some ways a more complex problem than the user side of things. If you'd like to see, try buying an ad on Twitter. They also have a division that does data products, including a variety of APIs, and another group that has other products for businesses, like tooling for the customer support interactions that people expect to handle on Twitter.
I of course can't forget their SRE folks, who keep all of the machinery humming and make sure all the software is doing what it's supposed to. There a quite a lot of people doing infrastructural work making tools and products that you never hear about and I probably can't list. There's also a good developer tooling group that helps keep the developers above working smoothly. And let's not forget their internal IT group,
Adjacent to engineering are a lot of really sharp product and design people, as well as a design research crew that understands the many ways people use Twitter and examine how it works for them.
We then must turn to people who handle the social side of this. When I worked there, that included a significant staff doing policy work, trust and safety enforcement, and handling darker things like CSAM and terrorism issues. There were also a bunch of people fighting the banal spammers.
And let's not forget the ML people! That alone was a few hundred people doing research, creating and improving models, and applying them to many of the things I mentioned above.
And at last we come to the kind of things that pretty much any large company needs: finance, legal, marketing, government relations, sales, computer security, physical security, admin, management, and the like.
If you ever wonder this in the future about any company, I suggest you look at their jobs site [2], which is always a good way to get an idea of what goes on at a company.
Easiest way to make money would be to fire 90% of them. 800 people is hardly a skeleton crew for running a service like Twitter, even at global scale, and then you would have plenty of profits.
It is astonishing how many 'fact oriented' people are opining on things they know nothing about, could easily google, are wrong about, and how upvoted they are here. I've heard the phrase poison pill before. I looked into it for real for the first time yesterday. Have maybe spent an hour since reading about it.
How are so many people morally outraged by some complex measure they're trying to authoritatively distill and are just so wrong about, and didn't even bother to google?
About 60% of this thread can be summed up as
"I'm going to pass this alphanumeric value to this variable."
"Twitter’s management wouldn’t have to worry about being kicked to the curb and they can continue doing what they do best, restricting conversation and censoring whatever they don’t like."
Media politics are just as bad as they always were. Typically TV and newspapers are ran at a loss by people who carry out political favors. I wonder how twitter users feel about being herded around like this
A poison pill adopted up front before there were any third parties that could claim to be prejudiced by it or adopted with a shareholder vote is one thing ... this seems to be begging for a successful lawsuit, and I can think of one 10% level investor who would be likely to file one.
I wonder if Twitter would be in the right to deactivate musk’s account. They’re a company & he’s clearly trying to cause them harm. I see no reasons as to why it wouldn’t be justified. (Hilarious too, I might add.
Because he's a near-10% shareholder and accounts like his are a major driver of new account growth. I wonder if this episode has impacted growth or engagement metrics any. Hard to imagine it hasn't
Because depending on how you look at it, Twitter suspending Trump (and Babylon Bee et cetera) was part of the motivation for Musk to buy Twitter in the first place.
I don’t think Elon has or ever has had any affinity for Trump. He left his advisor (or something of that nature) spot in the administration quite early on for a reason.
The fiduciary obligation is to act in the company's (not shareholders') best interests, not to maximise (short term) shareholder value. If the board has grounds to believe they can increase the value of the company over the long term by more than Musk's present offer is doing, they're right to do this and are legally safe.
…what if they board believes they are maximizing shareholder value in the medium or long term? What if they sincerely believe Musk would be a fickle CEO, and would make changes to the platform that would harm ad growth?
Part of it is that Musk doesn't have $43B in cash, he'd have to raise it or borrow it. He's worth more than that but it isn't liquid; as an officer of Tesla there are some restrictions on when he can trade. Another part is that many doubt whether Musk is serious or if he is playing games again, like the last time "420" appeared in a financial announcement from him.