Fewer jobs, less advertising
Elon Musk throws Twitter into chaos
11/05/2022 11:51 am
As a user of Twitter, Elon Musk is extremely successful. As an owner, however, not at all. Now he’s taking on the companies he absolutely needs as advertisers.
While Twitter’s employees fear for their jobs, Elon Musk exudes optimism. “I think it could be one of the most valuable companies in the world,” the tech billionaire said in a surprise appearance at an investment conference in New York. Meanwhile, employees are receiving emails telling them if they still work at Twitter. Media reports that around every second job will be lost seem to be confirmed.
The first interim report a week after completing Musk’s $44 billion Twitter purchase is sobering. Sales plummet because advertisers like Volkswagen and Pfizer want to stop or put their ads on hold. Meanwhile, according to Musk, the company is losing more than four million dollars a day – which also made the job cuts inevitable.
Twitter is now owned by one of its loudest, most well-known, and most controversial users. He himself still prefers to respond to tweets from users with similar opinions to his on the platform. They mostly have right views. Last weekend he posted a link to an unsubstantiated conspiracy theory about the attack on Paul Pelosi, the husband of US House Speaker Nancy Pelosi.
Advertisers like VW are keeping their distance from Twitter out of concern that Musk’s online network could become an even bigger playground for hate speech, hate speech and disinformation. Musk lamented a “massive drop in revenue” on Friday and accused “activist groups” of pressuring ad partners. The advertising business is by far Twitter’s most important source of income, over 90 percent of the group’s sales go back to it.
Thousands of terminations by email
Musk’s solution: He threatens advertisers who suspend their ad budgets with “thermonuclear naming and shame.” The tweet follows a right-wing Internet lobbyist’s suggestion that they be named so that a “counter-boycott” can be called for. The Musk phenomenon on Twitter includes a noisy crowd of loyal fans who attack almost anyone who criticizes him.
Such threats should go down much better with these fans than with the advertisers. As is the fact that the new Twitter owner, with more than 110 million followers, immediately shared a conspiracy theory.
Meanwhile, job cuts are causing deep uncertainty in the company itself. Employees were dismissed by email on Friday, but there was no official information on the number. Musk wants to reduce the number of employees from around 7,500 by about half, according to media reports. Manager Yoel Roth, who is responsible for removing hate speech, among other things, seemed to confirm the magnitude. Only 15 percent of the jobs in his area have been cut, instead of around 50 percent company-wide, he tweeted.
What is certain is that the bloodletting shook the company. Also because the layoffs are impersonal and chaotic. “Looks like I’m not employed anymore. I just got remotely logged out of my work laptop,” one employee tweeted. “It’s so sad that it ended like this”.
leadership fired
Ever since Musk delisted and privately owned Twitter a week ago on Friday, it doesn’t appear to have had a governance structure typical of larger companies. Immediately after taking over, he fired top management, dissolved the board of directors and appointed himself “sole director”. All power on Twitter now rests with Musk. And he wants to significantly reduce costs – in view of the red figures and immense debts that the company was saddled with when it was taken over, the pressure is high.
Meanwhile, it looked like Musk was trying to run Twitter via Twitter. According to media reports, while his confidants such as tech entrepreneur Jason Calacanis intervened in the company’s machinery, he threw ideas around on Twitter, such as that users could get different versions of the service “like age ratings in the cinema”.
In the end, it became concrete with the idea of giving the previously free verification tick only to customers of the paid subscription offer Twitter Blue. For eight instead of five dollars a month. The uproar among users was great – high fees would be due for large newspapers with hundreds of journalists alone. And then the “New York Times” also reported that, according to internal documents, it doesn’t look as if you would actually have to identify yourself for this. So far you can be sure that the person behind a verified account is actually the person behind it. It is now unclear whether this will still be the case later.