Shulou(Shulou.com)11/24 Report--

After half a year of disputes, repetition and litigation, Musk finally completed the acquisition of Twitter and became the owner of the world's most influential social media. But how to transform Twitter, which has stagnant growth and successive huge losses, will be a more difficult challenge for him, and he is also saddled with huge leveraged debt. Musk doesn't look up to Zuckerberg, and now that he's on the social network, can he do better?

Musk, the richest man in the world, walked into the Twitter headquarters in San Francisco on Wednesday morning when the bossy president cleaned Twitter. He wore a black T-shirt and black trousers, showing a strong figure and strong arms. On that day, he completed a $44 billion acquisition of Twitter, taking over the world's most influential social media platform.

Musk, once ridiculed around the world, has lost 18 jin of weight in just over a month with the help of diet and diet pills (self-introduction) since the photos of the seaside covered with white meat were exposed. Obviously, he used the energy of sleeping in the factory to supervise mass production to carry out figure management, and all of them were successful.

Musk walked into the Twitter hall with a white sink in his hand. He explained this on Twitter, "Let that sink in". This is actually a hot word on the Internet, which means to let your voice be carried out thoroughly. Musk clearly means that he is now the owner of Twitter and can thoroughly implement his intention to transform Twitter.

Musk didn't buy Twitter on a whim. He has always been a heavy Twitter user. Twitter has become his only social media since he deleted his Instagram account in 2018. Although his daily work is very busy, Musk, who has 114 million followers, spends almost every day on Twitter and even knows and cares about the specific product experience more than Twitter executives. This is very similar to the former president of the United States who "ruled the country with Twitter" he hoped to welcome back.

Like all heavy users, Musk has a lot of ideas and dissatisfaction about the product's features and platform conditions after using Twitter for many years. It's just that Twitter CEO used to be Jack Dorsey, and Musk didn't complain publicly for the sake of his friends. Musk has always praised Dorsey for his dislike of Zuckerberg.

Dorsey resigned as CEO at the end of last year under continued pressure from Twitter investors. The unscrupulous Musk began to openly ridicule Twitter's new CEO, directly venting his dissatisfaction with the slow development of Twitter products and suppressing conservative comments, and then came up with the idea of buying Twitter and reinventing it according to his own plan.

On the day of the deal, Musk couldn't wait to clean up Twitter: immediately disbanding the Twitter board, firing three core executives, CEO, CFO and general counsel, as well as some middle executives at the director and vice president levels. At the same time, Musk has hired a number of friends in his circle as advisers, including Jason Calacanis, a well-known angel investor who detailed to him his plans to transform Twitter.

In order to implement his plan more efficiently, Musk decided to take up a temporary CEO position on Twitter, and transferred more than 50 technical backbones from his company Tesla, underground tunnel company Boring and neuroscience company Neuralink to Twitter to censor the social media code.

Musk is known to dislike Zuckerberg and has mocked and belittled the Meta founder and CEO many times in public. When Facebook encountered a public relations crisis in 2018 and "delete Facebook" became a buzzword throughout the network, Musk also announced that he, Tesla and Space X accounts had all withdrawn from Facebook and Instagram.

Interestingly, Musk is now the owner of Twitter, officially entering the social media industry, and a peer and competitor to Zuckerberg. Can he successfully transform Twitter to prove that he can not only stand out in electric cars and aerospace, but also succeed in social networking, doing better than Zuckerberg, whom he despises?

What kind of changes do you plan to make to Twitter when the content review is handed over to the outside Musk?

Content censorship is, of course, the area where he most wants to transform Twitter. Musk is very dissatisfied with Twitter's censorship standards, which is the main reason for his acquisition of Twitter. Musk believes that Twitter has blocked too many conservative accounts and comments, and that former President Trump's account should not be blocked. As a result, conservatives and Republicans are looking forward to his acquisition of Twitter, while liberals and Democrats worry that Twitter will become a hotbed of extreme rhetoric and conspiracy theories.

But perhaps to the disappointment of conservatives, Musk did not immediately overturn Twitter's platform policy after taking office, but announced the formation of a "content review committee with a diverse perspective" in which he would not participate. Twitter will not change its current content censorship standards or restore previously banned accounts until the committee is formed and made a decision.

This is actually Zuckerberg's previous response, handing over the trickiest yams to a third party. In recent years, social contradictions in the United States have intensified day by day, and various extremes and conspiracies have emerged one after another. The content censorship policy of Facebook has been criticized by American society and public opinion. Especially during the racial riots in the 2020 election year, Facebook's inaction made Zuckerberg more of a target than Twitter's frequent tagging or folding of Trump's controversial comments.

Although Zuckerberg has repeatedly said he does not want to play the role of arbiter of facts, under the pressure of public opinion, Facebook officially spent $130 million in May 2020 to set up a content review committee made up of 20 outsiders. The 20 committee members include academic experts, media journalists, activists and outgoing dignitaries, of whom only five are Americans. After the committee was set up, Facebook handed over the right to block Trump's account (hot potato) to the external committee.

Musk has yet to disclose information about how the Twitter content review committee was formed. Whether Twitter will significantly change the content censorship policy and restore controversial accounts such as Trump in the future will directly depend on the position and background of these committee members. Obviously, the composition of this committee will be the focus of attention of the left and right sides of American society. Interestingly, the Facebook content censorship committee also retweeted Musk's tweets, welcoming Twitter to learn from their model.

However, Twitter under Mr Musk did fine-tune its political stance. Yesterday, the White House posted a tweet showing off its achievements, saying that US pensions reached a new high during the Biden administration. Twitter immediately relentlessly tagged and explained that pensions are linked to inflation and have nothing to do with the policies of the Biden administration. The White House quietly deleted the tweet after being slapped in the face in public. The practice of Twitter, which is "even in a bowl of water", was also praised by Musk.

The United States will hold key mid-term elections next week, and Democrats and Republicans will compete fiercely for seats in Congress, state governments and legislatures. As the most important platform for public opinion, Twitter is once again at the forefront of the storm. Since Musk took over, Twitter has restricted the rights of platform employees to avoid affecting content censorship because of the positions of their own employees.

Half of the layoffs are inevitable. Mr Musk's second cut on Twitter is to increase revenue and cut expenditure. Before he bought Twitter, it was reported that Musk had informed investors that he might cut 3/4 of Twitter's more than 7000 employees. Although Musk himself later denied the news, the media continued to spread the news about pushing for extra-large layoffs.

After completing the acquisition last week, Musk asked the heads of Twitter departments to review the performance of his employees and submit a list of key employees who should remain in office to his management team, according to US media reports. People who are not on this list will then become the targets of layoffs.

According to the latest news received by Bloomberg and The Verge, Musk may announce that Twitter will cut 3700 to 3800 jobs on Friday, up to half of the job cuts. In addition, Musk will abolish Twitter's telecommuting policy and require all employees to go back to the office unless specifically approved. Currently, about 1500 Twitter employees are telecommuting.

Musk has long been unhappy with Twitter's lax people management policy. In April, Musk even joked about turning Twitter headquarters into a homeless reception center, as most Twitter headquarters employees chose to telecommute, leaving Twitter's huge headquarters office in downtown San Francisco empty.

In May, Musk again mocked Apple's policy of allowing employees to continue to work from home. He retweeted the news that Apple postponed employees' plans to go back to work, accompanied by a picture of a fat, sleepy dog that read, "put on gym clothes and watch TV." mocking Apple employees for not going back to work because of laziness.

A year ago, Musk's high-handed management might have caused Twitter employees to move to other Internet giants. But now that the United States is in the shadow of recession and the stock market continues to fall, Internet giants have begun to announce layoffs or hiring freezes. Silicon Valley's once-hot job market has suddenly plummeted to a freezing point. This means that Twitter employees who have been laid off by Musk may have a hard time finding suitable new jobs in the short term.

In such a job market, current Twitter employees don't have much choice but to adapt to Musk's high-handed management style. According to media reports, some middle Twitter executives had to sleep in the office last weekend and required employees to work 12 hours a day, seven days a week, to complete Musk's assigned tasks. Tesla and Space X employees may be well adapted to this working atmosphere, but for Twitter employees, it will be a painful transition.

In addition to cutting staff and cutting expenses, Musk's other challenge is to increase Twitter's revenue. 92% of Twitter's $1.18 billion in revenue in the second quarter of this year came from advertising. But in the gloomy economic outlook, it has become a clear trend for advertisers to shrink their budgets, and Twitter's revenue will inevitably be affected.

Us advertising spending fell for the fifth month in a row in September, falling 5 per cent at the same time, according to advertising market research firm Standard Media. Channel advertising spending fell by 6% in the third quarter, involving cable television, social advertising, search advertising and many other areas.

The third-quarter results announced last week showed a significant slowdown or decline in advertising revenue on Internet platforms such as Google, Snapchat and Meta. YouTube advertising revenue fell for the first time, with Meta revenue falling 4 per cent. Google CFO Ruth Porat admits that advertisers are tightening their ads and their concerns about future uncertainties are growing.

To make matters worse, L'Or é al, Pfizer, food giant General Mills, IPG and other big advertisers temporarily stopped spending on Twitter because of concerns about the future of the Twitter platform after Musk completed the acquisition. Tesla's direct competitors Ford, General Motors and Audi even stopped their social marketing efforts on Twitter.

In such an unfavorable situation, Musk must find a new revenue source for Twitter and reduce his reliance on advertising revenue. Certification fees have become his priority means of generating income. After joining Twitter, Musk proposed a monthly fee of $20 for each Blue V verified account and asked the Twitter technical team to launch the feature on November 8.

However, the revenue-generating plan met with opposition from many celebrities. Stephen King, the king of horror novels, said publicly that he would not pay for certification, and Musk later replied that he was willing to reduce the fee to $8 a month. Musk has given enough respect to this famous writer, but he will not give him special treatment.

But he was less polite to Democratic politicians. When AOC, a radical Democratic congressman, tweeted that "billionaires want to charge $8 a month for the free speech platform", Musk responded mercilessly, "get the advice, pay now." He later posted a satire on the AOC fundraising website that sells $58 long-sleeved T-shirts.

Why is Musk so eager to increase revenue and reduce expenditure on Twitter? The world's richest man is also under economic pressure. Musk paid $44 billion for Twitter, of which $13 billion came from bank loans. Mr Musk reimburses the bank $1 billion a year, according to Dealbook estimates. Twitter is still losing heavily, with a loss of $340 million in the second quarter of this year.

With Tesla's share price low, Mr Musk is unlikely to continue to sell shares to cash in to repay loans, and he has to pay huge taxes on selling shares. Getting Twitter to stop bleeding and turn losses into profits as soon as possible, and let Twitter earn its own money to pay for loans, is the real reason behind Musk's massive layoffs and his rush to generate revenue.

However, Twitter currently has only 400,000 certified users, and even if everyone is willing to pay $8 a month, annual revenue is only $38 million. This is far from enough for Musk to pay the annual bank repayment. Musk also needs to find a new revenue model to improve Twitter's valuation.

Following the example of Tencent's super app for massive layoffs and certification fees is only Musk's short-term changes to Twitter. His real long-term plan for Twitter is to build a super app with all functions like China's Wechat. Yes, Musk has made no secret of his admiration for the Wechat super app model.

In media interviews in May and Twitter staff meetings in June, Musk publicly praised Wechat twice. "in China, people can live on Wechat and pay and everything on it. This (model) is great. We don't have an app like Wechat here. My idea is to copy the Wechat model."

After completing the acquisition, Musk once again mentioned the long-term plan to build super applications (everything app). "the acquisition of Twitter is the accelerator to create universal application X," he wrote on Twitter. Musk also talked about expanding the number of Twitter users to a billion. Twitter currently has about 450 million monthly active users and 240 million daily active users. The United States is Twitter's largest user market.

The most important step for Wechat to become a super application to connect social products and offline life is to improve the online and offline payment functions. And this may also be Musk's next step in transforming Twitter.

Payment used to be the way for Musk's family to get rich. In 1999, he founded the online payment website X. In com,2000, it merged with Confinity, a similar company of Peter Thiel, which became PayPal. However, PayPal's board supported Mr Thiel as CEO, leading the company through subsequent listings and sales, while Mr Musk was knocked out. After the sale of PayPal, Musk cashed out $176 million, embarking on a new journey to launch Space X and invest in Tesla.

Mr Musk has many supporters. Cathie Wood, founder of Ark Investment, who has long been bullish on Tesla, has said publicly that Mr Musk is considering turning Twitter into a super app like Wechat, and he started out in the payment industry. Ark Investment was also involved in Musk's acquisition of Twitter.

"I believe that when he works with Dorsey, there is hope that Twitter will become a super app," Wood said. Musk really believes in vertical integration and buying Twitter will be a great opportunity. " In the process of Musk's acquisition of Twitter, Dorsey also retained his original stake and continued to exist as a minority shareholder.

Cryptocurrency is also the choice of Twitter's future payment function. Musk and Dorsey are both main proponents of cryptocurrency and blockchain technology. Biannce, the world's largest cryptocurrency exchange, has also invested $500m in Musk. Zhao Changpeng, founder of Yuan'an, said, "We are excited to help Musk realize his new vision for Twitter and hope to play a role in combining social media with web3 to broaden the use of cryptocurrency and blockchain technology."

Musk, however, is not alone in admiring the Wechat super-app model. Zuckerberg, whom he despises, is already a Wechat user and has always wanted to turn Facebook into a super app like Wechat, reducing reliance on advertising revenue. In addition, Snapchat also added P2P payment to its applications, but eventually abandoned the product named Snapcash in 2018.

In early 2014, when a Chinese Facebook employee was using Wechat, he was surprised to find Zuckerberg on the "people nearby" page. When employees are curious (Zuckerberg sits with them in the office), Zuckerberg smiles with the iconic sunshine and frankly admits that this is his WeChat account. "when we make major acquisitions, we always need to know about the products of our competitors in the industry." That week, Zuckerberg bought WhatsApp for $19 billion.

In the following years, Facebook has been following the example of Chinese Internet products, constantly adding games, dating, e-commerce, payment, news and many other functions to many of its matrix products (Facebook, Facebook Messenger and Instagram), and wants to create a customer service platform to communicate between corporate brands and consumers.

But while the Meta social matrix has 2 billion daily active users worldwide (third-quarter earnings), Zuckerberg's super-app efforts have not yielded significant results. In the third quarter of this year, 98 per cent of Meta's revenue still comes from advertising.

Social networking giant Meta can not copy Wechat to the United States, to build a similar super app in the United States, disdainful of Zuckerberg's Musk's Twitter will be successful?

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