January 29, 2023

Elon Musk has threatened to pull out of a $44 billion deal with Twitter, saying the company refused to provide him with information about its fake accounts.

As a result, Twitter now plans to give Mr. Musk access to its vast trove of data, possibly all the way down to his last tweet.

The social media company has agreed to give Musk direct access to his “firehose,” the millions of tweets that flow through the company’s network every day, according to people familiar with the matter. It’s unclear whether Musk will get access to all or part of the “fire hose.”

This information will give Musk a tool to discern how many accounts on the Twitter platform may be fake. But that’s unlikely to help him reach Twitter’s conclusion that 5 percent of its active accounts are fake, because the company used a different method involving proprietary data and human analysis to come up with that number. Mr. Musk has said he does not believe that only 5 percent of active Twitter accounts are fake.

Twitter’s move could make it harder for Musk to end the deal. On Monday, his lawyers sent a letter to the company, accusing it of hindering his efforts to obtain information critical to completing the acquisition. Musk has also tweeted increasingly acrimonious comments about fake Twitter accounts for weeks, appearing to set the stage for a renegotiation or withdrawal of the deal.

In April, Musk agreed to buy Twitter for $54.20 per share. If the deal falls through, there will be a $1 billion breakup fee. But the agreement includes a “specific performance clause” that gives Twitter the right to sue him and force him to complete or pay the deal, as long as the debt financing he controls remains intact.

A Twitter spokesperson declined to comment on giving Musk access to the tweet stream, but referred to previous statements.

“Twitter has and will continue to work with Mr. Musk to share information to complete the transaction under the terms of the merger agreement,” Twitter said. “We believe this agreement is in the best interests of all shareholders. We intend to complete the transaction and execute the merger agreement at the agreed price and terms.”

Musk did not respond to a request for comment.Washington post reported earlier Mr. Musk gained access to Twitter’s fire hose.

A company often shares confidential data with an acquirer, negotiating parameters regarding data sharing before signing any deal. But Musk dropped due diligence in agreeing to buy the social media company, and Twitter began sharing confidential information with him last month.

One of Twitter’s concerns about sharing information, according to The New York Times, was Musk’s previous public and company statements that he was considering launching a rival social media service. Often, such issues are addressed by restricting who can access such information.

Musk said in his letter this week that he would ensure nondisclosure agreements bound anyone reviewing classified data provided by Twitter. He also said he would not retain or share sensitive information about Twitter if the deal fell apart.

Company insiders say that once Musk gains access to the Twitter feed, he will likely need a team of experts to analyze the data, as well as the computing power to process and store vast amounts of information.

While this information could give Musk insight into the number of fake Twitter accounts, it could also give him the data he needs to plan his business after the acquisition. Mr. Musk told investors he wanted to reduce Twitter’s reliance on advertising revenue and launch a new payments business.

Over the years, Twitter has counted its users the way many of its peers do, reporting monthly active use of the service. But in 2019, the company switched to what it said was a more accurate metric to measure the health of the business: “Monetizable Daily Active Users” — the number of people who are active on the site each day and can be used to generate ad revenue .

As of April, Twitter reported that it had 229 million monetizable daily active users. Of these, Twitter estimates that 5% are fake.

On Monday, Texas Attorney General Ken Paxton also said he was opening an investigation into fake accounts on Twitter and how they affect citizens in the state. Strategists see the move as a political expedient in an alliance with Musk. Tesla is Mr. Musk’s electric vehicle business headquartered in Austin, Texas. Mr. Musk also moved from California to Texas, where his SpaceX rocket company has a site.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *