"The World's Richest Man Gains Control Over SNS: Twitter Embraced by Musk (Comprehensive Report 2)"

[Image source=Yonhap News]

[Asia Economy New York=Special Correspondent Joeslgina] "The world's richest person has gained control over SNS. (Wall Street Journal)" "Ownership of Twitter grants Musk enormous power over social and political issues. (Washington Post)"

These are the evaluations pouring in as social media platform Twitter falls into the hands of Elon Musk, CEO of Tesla and the world's richest person. Musk, known as a 'power Twitterian' who could sway stock prices with a single word, has now acquired Twitter, which has over 200 million users, thereby gaining even greater online power encompassing political and social issues.

◆ Twitter Board Changes Stance... Accepts Musk's Proposal

On the 25th (local time), Twitter announced that it had agreed to be sold at $54.20 per share, totaling $44 billion, according to Musk's proposal. This decision came just 11 days after Musk first made the acquisition offer.

The $54.20 per share price represents a 38% premium based on the trading day immediately before Musk disclosed his approximately 9% stake in Twitter. This is the largest deal in the past 20 years involving the conversion of a publicly traded company into a private one. The acquisition process is expected to be completed within the year after shareholder votes and regulatory approvals.

In a statement, Musk said, "Freedom of expression is the foundation for democracy to function, and Twitter is a digital town square where important discussions about humanity's future take place," adding, "I want to make Twitter better than ever."

Initially, Twitter showed a negative stance, even activating a poison pill strategy right after Musk's acquisition proposal. However, after Musk revealed a $46.5 billion funding plan on the 21st, the board shifted to a more positive approach. Twitter board chairman Brett Taylor said, "We believe this is the best path for Twitter shareholders."

The New York Times (NYT) described it as "the victory of the world's richest person attempting to acquire an influential social media platform," calling the blockbuster deal "the grand finale of Musk's acquisition attempt, once thought impossible due to his notorious unpredictability."

◆ Musk's Twitter Predicts Major Transformation

'Musk's Twitter' is expected to break away from the regulatory and normative frameworks of traditional media. Musk has long proclaimed himself an 'absolute freedom of expression advocate' and has hinted at systemic changes to Twitter. A prime example is his plan to take the company private after acquisition. This is interpreted as a judgment that private companies are better positioned to pursue innovation than publicly traded companies, which are subject to institutional regulations and shareholder demands.

Significant changes in content management policies are expected immediately. Compared to other social media, Twitter has been relatively proactive in blocking fake news and hate speech, but going forward, it is anticipated to minimize content censorship and intervention in line with Musk's principles. Upon reports that negotiations were nearing completion, Musk tweeted, "I want even my worst critics to remain on Twitter. That is freedom of expression."

This also explains the ongoing discussions about the possible restoration of former President Trump's account related to this acquisition. Previously, Musk expressed caution about deleting tweets or permanently banning accounts, favoring timeout measures instead. Additionally, Musk confirmed plans to introduce open-source-based algorithms and remove bots that post spam and fake news.

The business model will inevitably change as well. Musk has clearly stated his intention to reduce reliance on advertising, Twitter's main revenue source. He said, "If survival depends on advertising, the power of companies influencing (Twitter) policies grows," and proposed a shift to a subscription economy model.

In his statement that day, he said, "Freedom of the press is the foundation of a functioning democracy, and Twitter has tremendous potential," adding, "I look forward to working with Twitter and its user community to unlock this potential."

◆ Expectations and Concerns Over "Enormous Influence"

Considering the enormous influence SNS has on shaping public opinion, views on Musk's acquisition are mixed with both expectations and concerns. The WSJ reported, "The world's richest person has gained control over SNS," and "This will cause global reverberations over the next few years, including reshaping how social media is used."

Concerns are also high regarding Musk's privatization of Twitter. The New York Times (NYT) pointed out, "Questions arise about what the famously unpredictable Musk will do with this platform and how his actions will affect global online discourse."

If Musk restores former President Trump's Twitter account citing freedom of expression, it is likely to escalate into a political issue. Trump was banned from Twitter last January for inciting violence during the U.S. Capitol riot. In an interview that day, Trump said, "I like Musk very much, but I do not plan to return to Twitter," stating he will use the platform he led, 'Truth Social.'

Challenges Musk must overcome include content censorship standards, strengthening global regulations, business revenue structure, internal turmoil, and market skepticism.

Questions are immediately raised about the extent of the freedom of expression Musk advocates. With Twitter's daily user base of 217 million, there is concern that harmful content such as fake news and hate speech could spread extensively. Brooke Erin Duffy, a professor in the Department of Communication at Cornell University, evaluated, "Efforts to eliminate Twitter's content regulation could undermine Twitter's (existing) promise to create the safest possible platform for users."

Musk's actions may also clash with global regulatory efforts to strengthen social media oversight. The European Union (EU) imposes fines up to 6% of revenue on platform companies that fail to properly manage harmful content under the Digital Services Act. Bridget Todd, secretary-general of the women's rights group Ultraviolet, argued, "Regarding platform content rules and means to ban users who violate them, Twitter could set a dangerous precedent for other social media."

Whether Musk's plan to reduce advertising revenue will succeed from a business perspective is also a key issue. Twitter has failed to turn a profit eight times in the past decade. The Guardian reported, "Twitter shareholders have long been concerned about the company's revenue and user growth." Currently, over 85% of Twitter's revenue comes from advertising.

Calming internal unrest at Twitter due to rapid changes and alleviating market skepticism are also Musk's challenges. Some speculate that large-scale employee departures could occur during the transition to Musk's leadership. The NYT noted that Twitter employees receive more than 50% of their total compensation through stock options, warning that going private could reduce employees' actual salaries.

Politico raised several important questions about Musk's acquisition, asking what role an individual with personal influence like Musk should play and what Musk truly wants.

This content was produced with the assistance of AI translation services.