By James Titcomb

25 April 2022 • 6:48pm

Elon Musk has managed to make the electric car cool and resurrected the US space industry, in the face of critics. But successfully fixing Twitter would possibly rank as his biggest accomplishment to date.

The world’s richest person secured a $44bn (£35bn) deal to take the 16-year-old social media company private on Monday. 

Little more than a week after announcing plans for a “poison pill” defence that would prevent Musk from enlarging his stake in the company, Twitter’s board unanimously accepted Musk’s “best and final” offer of $54.20 a share. It said the deal was expected to close this year, albeit following the approval of shareholders and regulators.

Securing the deal was a victory in its own right. Twitter had invited other potential bidders only for none to then emerge, while one of its biggest shareholders, Saudi Prince Al Waleed bin Talal Al Saud, had taken to Twitter to say the deal undervalued the company.

Musk had also faced questions about whether he had the money to buy the New York-listed company. Last Thursday, however, he came up with the goods - a $46.5bn financing package, including billions borrowed against his Tesla shares.

Brinkmanship has been chaotic. Musk backed out of a bid to join the Californian company’s board, openly mused about whether Twitter’s headquarters should be turned into a homeless shelter, and declared that his takeover could easily fail. 

But whether it is the result of chance or brilliant strategy, he has appeared to emerged victorious. 

Winning control of Twitter might be the easy part, however. Running it could be another matter altogether. 

For most of its history, the social network has been at the centre of political and social life, not just in the US but globally. Yet it has failed to turn its influence into a successful business.

Twitter has turned an annual profit just twice, in 2018 and 2019. Shares have barely moved in almost a decade as a public company. User numbers are dwarfed by not only Facebook, but lesser and more modern social media apps such as Pinterest and Snapchat. 

Even among users who log in every day, the relationship is a tumultuous one: Twitter faces accusations from the right of being a ban-happy liberal echo chamber dominated by groupthink, and from the left of allowing hate speech and misogyny to run unchecked. 

Musk, 50, is yet to outline a clear plan for what he wants to do with Twitter, but has hinted at what he thinks should be in the company’s future.

“Twitter has become kind of the de facto town square,” he told a conference in Vancouver earlier this month, on the day he unveiled his takeover offer, adding that he wanted to make it an “inclusive arena for free speech”.

That is likely to be music to the ears of critics who say the company has swung increasingly to censorship in recent years, culminating with the banning of Donald Trump last year. By contrast, Musk has said that Twitter should let people “speak freely within the bounds of the law”.

Bruce Daisley, who was Twitter’s head of Europe, the Middle East and Africa until 2020, says Musk is unlikely to burst into the company and rip up the rulebook. 

“The fact that he's had success at multiple companies indicates that, rather than this notion that he wants it to be an orgy of free speech, he's actually gonna go in there, and he's gonna listen to intelligent people who’ve been doing the job,” he says. 

“The first thing they're gonna say to him is, we tried unrestrained free speech. And it led to a lot of harm.”

Failing to crack down on abuse has put Twitter in hot water with the advertisers that make up the majority of its revenue. Companies including Unilever and Coca-Cola have at times boycotted the company in response to hate speech concerns and pressure from activists.

Musk has said this should give Twitter a reason to wean itself off such advertising. “The power of corporations to dictate policy is greatly enhanced if Twitter depends on advertising money to survive,” he said earlier this month. 

As one potential solution, he has called for Twitter to greatly expand its nascent subscription service, Twitter Blue, by cutting the price and adding features such as identity verification. It is unclear that this would be sufficient to replace advertising, however: even at its current price of $3 (£2.4) a month, two thirds of Twitter’s 217m daily users would have to subscribe to match the $5.1bn the company made in revenue last year. 

Musk has insisted he is not focused on turning Twitter into a profit machine. “I don’t care about the economics, at all,” he added on the day he unveiled the bid. Even so, the company would still have to service billions of dollars in debt Musk expects to use to fund the takeover, requiring a degree of cash flow.

If Twitter is to be rejuvenated, Daisley says taking it private may be the best way of doing so. “Being a private company is going to make any running of the organisation significantly easier. At the moment, an organisation like Twitter spends a lot of energy every quarter, trying to deliver results to expectations. It's a very exhausting process,” he explains.

Even though Musk has won his battle with Twitter’s board, rescuing the company will be an uphill struggle. But those who bet against him before have come to regret it.