[Summary] 'Tweet-Addict' Musk Becomes Largest Shareholder... What Will Change at Twitter?

[Image source=Reuters Yonhap News]

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[Asia Economy New York=Special Correspondent Joselgina] "Oh hi lol (laughing emoji)."

This was the first tweet posted immediately after it became known that 'Twitter fanatic' Elon Musk, CEO of Tesla, had become the largest shareholder of social media platform Twitter. The fact that Musk purchased a 9.2% stake in the company is not simply seen as a mere investment. Just over a week ago, he publicly criticized Twitter's role in a tweet, asking, "Do we need a new social networking service (SNS) platform?" Moreover, this comes at a sensitive time for Twitter, as its founder Jack Dorsey stepped down as CEO only a few months ago.

According to the U.S. Securities and Exchange Commission (SEC) on the 4th (local time), Musk purchased 73,486,938 shares of Twitter on the 14th of last month, becoming the largest shareholder with a 9.2% stake. The value of this stake, based on the closing price on the 1st, amounts to $2.89 billion (3.51 trillion KRW). Previously, the global investment firm Vanguard, which held an 8.79% stake, was the largest shareholder.

What Musk intends to do with his Twitter shares has not yet been revealed. However, considering that on the 25th of last month he conducted a poll on his Twitter asking, "Do you think Twitter is upholding the great principle of freedom of the press?" the possibility that this is just a simple investment is very low. He has already hinted at changes to Twitter's policies.

In that poll, over 2 million respondents answered 'No' by more than 70%. Following this, Musk asked the next day, "Do we need a new SNS platform?" When a Twitter user emphasized open-source algorithms, freedom of expression, and minimizing advertising, Musk replied, "I am seriously considering this issue."

Charlie Elson, founding director of the Weinberg Center, said, "Just because Musk's stake is reported as a passive investment does not mean he must be passive in conveying his opinions about Twitter," predicting changes. Eric Ross, an analyst at Cassandre Securities, said, "There is no such thing as a passive investor for Elon Musk," and predicted that he would "roll up his sleeves" through additional purchases.

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Musk is known as a representative Twitter fanatic. Since creating his account in June 2009, he has posted over 17,300 tweets to date. With approximately 80.35 million followers, he ranks 10th worldwide. A notable example of his immense influence is when he was sued by the SEC for his explosive remarks about Tesla's delisting. The Los Angeles Times described this share purchase as "Musk's ambition to influence the platform's stance on freedom of the press, content, and digital censorship."

There is speculation that major posts prioritizing 'freedom of expression' may soon be reinstated on Twitter. Under CEO Dorsey's leadership, Twitter had proactively deleted hate posts, fake news, and inciting content. Notably, former U.S. President Donald Trump's account might be reinstated under Musk's Twitter. Already, Trump's supporters have been posting on Musk's account.

There is also speculation that the cryptocurrency Dogecoin, favored by Musk, could become a payment method on Twitter. Dogecoin surged double digits on the day amid such expectations.

For Twitter, confusion is expected as a new CEO has taken office. Currently, a photoshopped image circulating on Twitter satirizes Musk's investment by showing Musk drowning current Twitter CEO Parag Agrawal. Agrawal had previously announced plans to introduce blockchain-based technologies such as non-fungible tokens (NFTs) to Twitter, but Musk has publicly criticized these plans. Among Korean investors, Cathie Wood of ARK Investment, nicknamed the 'Money Tree Sister,' mentioned in a foreign media interview that "this could lead to another leadership change at Twitter," hinting at possible management reshuffles.

However, Eric Sheridan of Goldman Sachs argued, "Musk's share purchase will not change Twitter's current business model." Mark Weinstein, founder of MeWe, an alternative SNS to Facebook, called it "good news," saying it "will help return to the roots of embracing the principle of freedom of expression."

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Musk's share purchase contrasts with the actions of former President Trump, who was expelled from Twitter earlier. After being banned from Twitter and other platforms following the Capitol riot in January last year, Trump launched his own SNS platform, 'Truth Social,' in February this year. His goal was to create a new chapter against big tech companies, but the results were dismal.

The app, released to coincide with Presidents' Day (February 21), remained difficult to access for weeks. It did not rank within the top 100 app downloads. Major foreign media reported that two key executives, including the CTO, left Truth Social. On the same day, Twitter's stock price surged 27% on the New York Stock Exchange, while Truth Social's stock price plummeted 13%.

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