Speaker 1: Welcome to tech Stuff, a production from my Heart Radio.
Speaker 1: Hey there, and welcome to tech Stuff. I'm your host,
Speaker 1: Johnathan Strickland. I'm an executive producer with I Heart Radio
Speaker 1: and how the Tech are You? You know, tech Stuff
Speaker 1: has a long history with Twitter. Way back when I
Speaker 1: was a writer for how Stuff works dot com, I
Speaker 1: became one of the first employees to establish a Twitter account,
Speaker 1: and I would use that account to share articles I
Speaker 1: had written, as well as you know, make goofy jokes
Speaker 1: and share photos of pets and tacos and that kind
Speaker 1: of thing. And my use of Twitter actually got me
Speaker 1: an award at work because I had found a new
Speaker 1: form of outreach. I didn't set out to win an award.
Speaker 1: This just kind of happened because I was just using Twitter,
Speaker 1: and I honestly was really worried because the thing I
Speaker 1: was doing on my own for funzies is likely to
Speaker 1: become a mandated part of our work, which meant my
Speaker 1: co workers who had no interest in creating Twitter accounts
Speaker 1: might find that they were obligated to. So whoop. See,
Speaker 1: this is why we can't have nice things now. When
Speaker 1: we launched the podcast text Stuff, Twitter was front of mind.
Speaker 1: We actually did an episode about Twitter on our twelfth episode. Ever,
Speaker 1: this was back when Chris Palette was my co host,
Speaker 1: and then six years after that, Lauren Vogelbaum and I
Speaker 1: would do an episode called The Twitter Story back in
Speaker 1: the early Feen, I should add, and this was back
Speaker 1: when she was my co host. But a lot has
Speaker 1: happened since two thousand fourteen, not the least of which
Speaker 1: is the ongoing drama between Elon Musk and Twitter, which
Speaker 1: we will get to. I mean, for one thing, now,
Speaker 1: I have no co host, so today I thought we'd
Speaker 1: do an update on what's been going on now. I'm
Speaker 1: also gonna do a rundown of the early history of Twitter,
Speaker 1: so that way you don't have to seek out those
Speaker 1: older episodes if you don't want to. However, I want
Speaker 1: to say I'm not gonna go over everything we covered
Speaker 1: in those previous episodes. I'm gonna hit kind of the
Speaker 1: highlights at Twitter. But if you want to learn more,
Speaker 1: including some of the pivotal moments in history that Twitter
Speaker 1: played a part in, I recommend going back through the
Speaker 1: archives and checking out those episodes, particularly The Twitter Story,
Speaker 1: which published I think maybe February four Okay, once upon
Speaker 1: a time, you had a fellow by the name of
Speaker 1: Noah Glass who built a tool that would let you
Speaker 1: convert a phone message into an MP three file, and
Speaker 1: you could host that MP three file on a service
Speaker 1: on the Internet. And this was the core focus of
Speaker 1: a company that was called Odeo o d e O.
Speaker 1: Odio brought on a guy named Evan Williams to become
Speaker 1: the CEO. Williams had co founded Blogger, so he already
Speaker 1: had a winning record in startups, if by winning record
Speaker 1: you mean creating a tool that would later get bought
Speaker 1: by Google and being a little snarky. But Blogger is
Speaker 1: actually still around today. It's one of the few things
Speaker 1: Google purchased that it did not subsequently shut down just
Speaker 1: a few years later. In fact, I don't really have
Speaker 1: it in this episode, but Google did purchase a Twitter
Speaker 1: like service called Jaku and then subsequently shut that down,
Speaker 1: so that happens a lot anyway. Evan Williams brought over
Speaker 1: biz Stone from Google to join Odio, and another person
Speaker 1: who was working at Odeo as a web developer was
Speaker 1: named Jack Dorsey. And obviously these folks would become very
Speaker 1: important in the history of Twitter. One of the company's
Speaker 1: first big projects was to build out a podcasting platform.
Speaker 1: So podcasting at this time was still a pretty young
Speaker 1: art form, and the leaders at Odeo saw an opportunity
Speaker 1: to become kind of the dominant podcasting platform in the space,
Speaker 1: to allow people to discover and subscribe to podcast easily,
Speaker 1: and they launched their platform, and then shortly after, Apple
Speaker 1: launched its own podcast section in iTunes, and that was
Speaker 1: pretty much curtains for Odio's product. Apple already had incredible reach,
Speaker 1: I bought owners were reliant on iTunes in order to
Speaker 1: add new content to their devices, and so incorporating a
Speaker 1: podcast subscription feature into iTunes kind of shut the door
Speaker 1: down on everybody else at that time. I mean, we
Speaker 1: do call them podcasts after all. Odios podcast platform, technically
Speaker 1: launched ahead of iTunes, went live earlier in two thousand five.
Speaker 1: But even after Odio flipped the switched on, there was
Speaker 1: a big problem because no one was using Odio, Not
Speaker 1: even Odio employees were using it. They had built a tool,
Speaker 1: but they hadn't convinced anyone that the tool was, you know,
Speaker 1: worth using. Jack Dorsey meanwhile, was contemplating a different course altogether.
Speaker 1: Dorsey thought it might be interesting to create a service
Speaker 1: that would let people post status updates in real time,
Speaker 1: sort of like a very stripped down social media platform,
Speaker 1: one where you could just post your stats update and
Speaker 1: push it out to folks in your social circle, like
Speaker 1: the people in your contact list. For example. Maybe for
Speaker 1: you might be thinking about you want to go bowling,
Speaker 1: and you want to see if any of your friends
Speaker 1: are down, so you could send out a what would
Speaker 1: be more or less a group text message using the service,
Speaker 1: saying going bowling, want to join, and then waiting to
Speaker 1: see if anyone responds. Now, according to Dorsey, he had
Speaker 1: actually been mulling this over for several years already. He
Speaker 1: wanted a tool that would let folks update their status
Speaker 1: in real time using a mobile device. Now, remember this
Speaker 1: was before iPhones and therefore before the smartphone phenomenon, at
Speaker 1: least among the mainstream. Back in the early to mid
Speaker 1: two thousand's, most devices that would qualify as a smartphone
Speaker 1: were in the hands of executives and maybe a few
Speaker 1: curious early adopters, and they looked, you know, more like
Speaker 1: the old BlackBerry. Phones often had physical keyboards. Dorsey wanted
Speaker 1: to create something that would work with simple cell phones
Speaker 1: because that's what most people had. Dorsey eventually teamed up
Speaker 1: with Noah Glass and they brought in a contract developer
Speaker 1: named Florian Webber, and together they fleshed out this idea
Speaker 1: and began to build what would become Twitter. You would
Speaker 1: have the platform that would support status updates. You could
Speaker 1: follow folks that you knew, so you could essentially subscribe
Speaker 1: to them and then keep up with what was going
Speaker 1: on in their lives. So when they posted an update,
Speaker 1: you could get an alert. You can get a text
Speaker 1: message telling you about that update that actually has the
Speaker 1: update in it. You could still text person to person obviously,
Speaker 1: but this would let folks communicate one too many, not
Speaker 1: just one to one. So the team presented the idea
Speaker 1: to Odio's leadership and and this was in two thousand six,
Speaker 1: and originally they were going to call it Twitter with
Speaker 1: no vowels so t W T t r UH, and
Speaker 1: they got a tentative go ahead from Odeo, which was
Speaker 1: mostly in crisis mode over its primary product not going anywhere.
Speaker 1: On March twenty one, two thousand six, Jack Dorsey would
Speaker 1: send the first message on Twitter, and just like with
Speaker 1: the first video of YouTube, the actual historical first is
Speaker 1: a bit underwhelming, He wrote, quote, just setting up my
Speaker 1: Twitter again t W T t R. Now a quick
Speaker 1: reminder for folks who may have forgotten. Way back in
Speaker 1: the earliest days of Twitter, there was a one hundred
Speaker 1: forty character limit on messages. And you might wonder why. Well,
Speaker 1: the whole service was built on top of the SMS
Speaker 1: texting service, and SMS could only carry messages of up
Speaker 1: to one hundred sixty characters in length. Twitter allowed just
Speaker 1: a hundred forty because it would reserve twenty characters for
Speaker 1: user handles and that kind of thing. Using SMS was
Speaker 1: important for Twitter because all the work building out the
Speaker 1: technology to actually make texting possible had already been done.
Speaker 1: Twitter didn't have to invent that it existed. Twitter's technology
Speaker 1: could be on top of that foundation. Twitter would go
Speaker 1: on to build both a web based interface and also
Speaker 1: allow users to interact with Twitter purely through texting on
Speaker 1: their cell phones. This would also mean that early Twitter users,
Speaker 1: depending on how they enabled Twitter and how they used it,
Speaker 1: would have to keep in mind that they could get
Speaker 1: charged for texting due to Twitter activity. Uh and it's
Speaker 1: not so much the case today, but back in the day,
Speaker 1: like cell phone companies, carriers would find lots of creative
Speaker 1: ways to charge you, including if you used too many
Speaker 1: messages in a month. In July of two thousand six,
Speaker 1: Twitter again still t w t t R, launched sort of.
Speaker 1: It was a pretty small launch and that most of
Speaker 1: the users were either Odio people or Silicon Valley folks
Speaker 1: like investors and people who worked at other tech companies.
Speaker 1: In September of two thousand and six, Evan Williams would
Speaker 1: buy back the stake that various investors had in Odio.
Speaker 1: So Williams was saying that Odio's podcast platform was a
Speaker 1: bust and that very few people, maybe around five thousand,
Speaker 1: had even registered with Twitter. So he was saying, rather
Speaker 1: than have your investment become a loss, I will buy
Speaker 1: back your investment now. Later speculation suggested that Williams could
Speaker 1: see where Twitter was going, and so he wanted to
Speaker 1: get ahead of it in order to really profit off
Speaker 1: of it. Like he would spend the money now to
Speaker 1: buy back these investments, but then once Twitter took off,
Speaker 1: he would really be making bank. Now. I don't know
Speaker 1: about that. It's possible, but then nothing in tech is
Speaker 1: a sure bet, and that sounds like a really hefty
Speaker 1: gamble to me, but it might have been the case,
Speaker 1: and if it was a gamble, it did pay off.
Speaker 1: Around this time, Noah Glass got fired from Odio. Now
Speaker 1: apparently Glass and Evan Williams had opposing personalities, and Glass
Speaker 1: would later say that he had actually been planning to
Speaker 1: spend Twitter off from Odio and then lead Twitter himself.
Speaker 1: That obviously never happened. Instead, Video changed its name to
Speaker 1: Obvious Corporation and it prepped for two thousand seven. That's
Speaker 1: when the platform made a big appearance at south By Southwest.
Speaker 1: That's obviously this this huge event that happens in Austin, Texas,
Speaker 1: and if it revolves around three major topics. There's music,
Speaker 1: so all these different bands from around the world come
Speaker 1: to Austin and play shows. There's movies, so you've got
Speaker 1: lots of studios and independent filmmakers showing films at south
Speaker 1: By Southwest. And then there's interactive or technology, and that's
Speaker 1: what you know Obvious Court was going to. And so
Speaker 1: Twitter made an appearance and it won an award and
Speaker 1: got a lot more coverage. So while the service had
Speaker 1: been up for a little less than a year, you
Speaker 1: could argue that March two thousand seven was the real
Speaker 1: starting point for Twitter, because it was at south By
Speaker 1: Southwest that the tech world in general really latched onto
Speaker 1: it and it began to grow rap and a month later,
Speaker 1: Obvious Corporations spun off Twitter as a standalone company. Dorsey
Speaker 1: would end up serving as CEO of Twitter and Evan
Speaker 1: Williams would be Chairman of the board. Twitter would go
Speaker 1: on to raise nearly six million dollars in initial funding
Speaker 1: with investors, and for many many years, Twitter, getting a
Speaker 1: fresh influx of investor cash would be how the company
Speaker 1: would stay in business. It actually became something of a
Speaker 1: running joke that Twitter would be a tool that everyone wanted,
Speaker 1: everyone used, but it had no real way to make
Speaker 1: any money. So the only way it could stay in
Speaker 1: business is if it asked investors to pour more cash
Speaker 1: into it. Something else that would become a running joke
Speaker 1: with Twitter for a few years anyway, involved its web interface,
Speaker 1: so this was still kind of coming together in two
Speaker 1: thousand seven and two thousand eight. But the web interface
Speaker 1: would let you scroll through tweets and post new tweets
Speaker 1: without having to use your phone. You could navigate to
Speaker 1: the web page into it. You can still do that today.
Speaker 1: In fact, a lot of people do how of her.
Speaker 1: Twitter was really growing very quickly, and sometimes stuff broke,
Speaker 1: particularly during you know, busy moments, like if there was
Speaker 1: a big cultural event that a lot of people were
Speaker 1: reacting to that could really tax Twitter's servers, and when
Speaker 1: that happened, web users would frequently encounter an error page
Speaker 1: that had a cartoon whale on it. It was a
Speaker 1: cartoon whale being lifted into the air by a bunch
Speaker 1: of little birds. It was artwork that was created by
Speaker 1: an artist named ye Inglu for a stock art site.
Speaker 1: Lou had originally created the image for a birthday card,
Speaker 1: and she called the image lifting a dreamer. But on
Speaker 1: Twitter this image had a different name. It became known
Speaker 1: as the fail Whale, and back in the old days,
Speaker 1: he saw it fairly frequently if you were an avid
Speaker 1: Twitter user. If you're not familiar with the fail Whale,
Speaker 1: chances are your experience with Twitter started after the year
Speaker 1: two thousand and thirteen, because that's when Twitter finally discontinued
Speaker 1: the use of the image. In October two thousand eight,
Speaker 1: Jack Dorsey would stepped down as CEO of Twitter for
Speaker 1: the first time, but not the last time. Evan Williams
Speaker 1: became the new CEO and Dorsey became the new chairman
Speaker 1: of the board, which meant that the two of them
Speaker 1: just did the old switchero. Apparently working for Dorsey could
Speaker 1: be a bit challenging, according from insider reports on Twitter,
Speaker 1: so there appeared to be an impetus for this change.
Speaker 1: In January two thousand nine, Twitter would make world headlines
Speaker 1: because a tweet actually broke a news story before any
Speaker 1: major media outlet could do it, and that news story
Speaker 1: was the crash landing of US Airways Flight fifty nine
Speaker 1: into the Hudson River. The plane had collided with a
Speaker 1: flock of birds shortly after it took off from LaGuardia Airport,
Speaker 1: and pilots Jeffrey Skiles and Chesley Sully Sullenberg glided the
Speaker 1: plane into the Hudson. All passengers and crew survived. A
Speaker 1: few folks received some serious injuries, but other than that, uh,
Speaker 1: it was remarkably safe, and the message on Twitter got
Speaker 1: boosted and seen before any official news outlets could get
Speaker 1: word out, and it became obvious that Twitter could play
Speaker 1: a critical role in covering important events in real time,
Speaker 1: not just an app that let you say what you
Speaker 1: were having for lunch. Okay, we're gonna take a quick
Speaker 1: break here. When we come back, we will continue Twitter's history.
Speaker 1: We're back. So in two thousand nine, Jack Dorsey co
Speaker 1: founded another company, and this company is a payment processing service,
Speaker 1: with the big selling point at the time being that
Speaker 1: you could get an attachment for a mobile device that
Speaker 1: would let you swipe credit cards and process the fees
Speaker 1: right there, which drastically reduced the infrastructure you needed in
Speaker 1: order to have a point of sale that could accept
Speaker 1: credit cards. So this is when suddenly merchants who would
Speaker 1: go to like festivals and stuff would be able to
Speaker 1: easily accept credit cards because using a mobile device that's
Speaker 1: connected to the cellular network, using this add on and
Speaker 1: then swiping a card, they could actually process payments without
Speaker 1: having to get the old carbon copy stuff out. That
Speaker 1: company is of course named Square, and while it's not
Speaker 1: directly tied to Twitter, Square would have a huge impact
Speaker 1: on Twitter's history. Later on, in October, Evan Williams would
Speaker 1: step down as CEO to focus on product strategy, and
Speaker 1: former CEO of Twitter, Dick Costello would take over and
Speaker 1: remain CEO until now. In Twitter would launch Vine, which
Speaker 1: is a short form video app, or was a short
Speaker 1: form video app. They'll let users post videos that were
Speaker 1: just six seconds long. And you know, their original intent
Speaker 1: was just to create a video version of a tweet,
Speaker 1: like something that's very short and very timely that you
Speaker 1: could then share online. However, people took to Vine in
Speaker 1: order to build stories and very short films and making
Speaker 1: a really good Vine became a real art form and
Speaker 1: and a lot of people use it for storytelling or
Speaker 1: more accurately, joke telling. And Vine would stick around for
Speaker 1: a few years, but Twitter would ultimately shut it down
Speaker 1: in and I'll talk about why that happened and a
Speaker 1: little bit. In November, Twitter held its initial public offering
Speaker 1: or i p O. Now, in case you're not familiar
Speaker 1: with that term, that's when a privately held company transitions
Speaker 1: into becoming a publicly traded company with shares trading on
Speaker 1: a stock market somewhere. This lets anyone who has the
Speaker 1: cash become an investor by buying up a share or
Speaker 1: maybe a few shares or maybe a few thousand shares
Speaker 1: before the stock market opened. The offer price was to
Speaker 1: be around twenty six dollars per share, so part of
Speaker 1: the process of the I p O is that a
Speaker 1: company has to kind of figure out what they think
Speaker 1: a share price is worth. And this is supposed to
Speaker 1: be based upon the value of the company, and you're
Speaker 1: supposed to take all these different things into account. There's
Speaker 1: a very long process for doing it. So in Twitter's case,
Speaker 1: they thought this merit's a twenty six dollar price for
Speaker 1: a share of stock of Twitter. Instead, due to intense
Speaker 1: interest in the market, when sales opened up, those shares
Speaker 1: were moving at forty five dollars per share. At the
Speaker 1: end of the day, it closed just slightly lower than that,
Speaker 1: at forty four dollars ninety cents per share, and still
Speaker 1: much higher than twenty six bucks. Right now, if you're curious,
Speaker 1: the day I'm recording this episode, Twitter is currently trading
Speaker 1: in around thirty three dollars and fifty cents to thirty
Speaker 1: three dollars and sixty cents per share, somewhere around in
Speaker 1: that range. So still higher than what the opening offer
Speaker 1: price was going to be, but lower than what the
Speaker 1: actual price of Twitter stock was for that first day
Speaker 1: of trading. Not Over time, Twitter's stock price would grow
Speaker 1: um not steadily. There were times where it would dip
Speaker 1: a bit and then it would grow a bit. It
Speaker 1: hit a high, but not an all time high, in
Speaker 1: December of two thousand thirteen, when it closed at a
Speaker 1: price of seventy three dollars and thirty one cents per share.
Speaker 1: Really amazing, Like when you consider that's one month after
Speaker 1: it started trading, that's phenomenal. However, in February two thousand
Speaker 1: and fourteen, Twitter reported that its growth had slowed, with
Speaker 1: an increase of just five additional users. So the way
Speaker 1: that these metrics work, it's not just that you have
Speaker 1: to keep growing in order to be perceived as valuable.
Speaker 1: You need to be growing at an increasingly faster rate
Speaker 1: for the market to consider your company as still being valuable.
Speaker 1: When your growth begins to slow, investors get nervous because
Speaker 1: they're worried that's just a matter of time before that
Speaker 1: growth number levels out and then begins to be a
Speaker 1: lost number instead of a growth number. So you never
Speaker 1: want to see the growth rate decrease. At best, you
Speaker 1: want to level it out, but you don't want to
Speaker 1: see it go down from one year to the next anyway.
Speaker 1: The stock price began to decline starting around early two
Speaker 1: thousand fourteen, and by May fourteen, it was down to
Speaker 1: thirty dollars fifty cents per share, less than half of
Speaker 1: what it had been at its earlier peak. But then
Speaker 1: two years later, on May twenty six, two thousand sixteen,
Speaker 1: it would be all the way down to fourteen dollars
Speaker 1: and three cents per share. Yikes, um, and a lot
Speaker 1: of stuff was going on to make this happen. Right,
Speaker 1: The stock price was reacting to lots of investor worries.
Speaker 1: Whenever Twitter would say that they hadn't met their revenue goals,
Speaker 1: or that their growth rate was lower than expected, or
Speaker 1: that user engage it wasn't on the incline, then you
Speaker 1: would see a loss of investor confidence and ultimately a
Speaker 1: drop in share price. Now, over time, that price would recover.
Speaker 1: It was in the teams for a really long time,
Speaker 1: but eventually it would grow back into the twenty and
Speaker 1: thirty dollar range and then higher. So by two thousand eighteen,
Speaker 1: the price would still be fluctuating, but generally was on
Speaker 1: a path of growth, and by March first, two thousand
Speaker 1: twenty one, the price hit its all time high of
Speaker 1: seventy seven dollars sixty three cents per share. All right, um,
Speaker 1: we're now past the point where the old Twitter Story
Speaker 1: podcast left off, because, like I said, we recorded that
Speaker 1: in the winter often like the early winter. February I
Speaker 1: think is when we recorded it. So let's talk about
Speaker 1: stuff that happened after February fourteen. If we go to
Speaker 1: the end of that year, December, Twitter released some anti
Speaker 1: harassment tools, so it was bowing to pressure to do
Speaker 1: something about the intense abuse some users were receiving for
Speaker 1: having the audacity to do radical things like being a
Speaker 1: woman or you know, having an opinion that was different
Speaker 1: from other people. I'm being more than a little snarky here,
Speaker 1: but we have to remember, Okay. August of two thousand
Speaker 1: fourteen was when we had the beginning of gamer gait,
Speaker 1: which was a truly awful campaign in which angry people,
Speaker 1: mostly men and mostly straight, began to target mostly women
Speaker 1: in the video games industry. Now not exclusively, there were
Speaker 1: other people who were targeted to the way this was
Speaker 1: framed was that it was a crusade to weed out
Speaker 1: corruption and misinformation in the video game industry and video
Speaker 1: game journalism, the idea being that video game reviewers were
Speaker 1: frequently compensated in some way or had some vested interest
Speaker 1: in how games were doing, and that that was guiding
Speaker 1: their their what they would write about games. Like in
Speaker 1: some cases it was just that someone didn't like a
Speaker 1: game that you know, the rabid fan base absolutely loved,
Speaker 1: and that that was akin to committing treason, and so
Speaker 1: this rabid group of fans would want to punish the
Speaker 1: person who wrote something critical about a game they loved.
Speaker 1: So again, a lot of the people who are targeted
Speaker 1: in gamer Gate were women, and some of those women
Speaker 1: were journalists who covered video games. Some of the women
Speaker 1: were developers in the space or publishers, and the gamer
Speaker 1: Gate jerks would use all sorts of abusive tactics, including
Speaker 1: but not limited to, dockx ing and swatting their targets.
Speaker 1: So dockx ing is when you reveal a person's personal
Speaker 1: information online, so it's someone else like someone else's info,
Speaker 1: and you're sharing it online. Swatting is when you use
Speaker 1: personal information to call in a police act and on
Speaker 1: a target. So you would give your targets home address
Speaker 1: and say that there was something really like critically dangerous
Speaker 1: going on there in order to get police to send,
Speaker 1: you know, people, perhaps even a whole swat team to
Speaker 1: go and check in on that target, and it's all
Speaker 1: in an effort to harass, terrorize, or otherwise disrupt the
Speaker 1: target's life. So this was happening with gamer Gate a lot.
Speaker 1: And while the supposed reason for gamer Gate was to
Speaker 1: try and uh and hold the video game industry accountable,
Speaker 1: what it really was about was these these people who
Speaker 1: were who felt ownership over an industry that they did
Speaker 1: not own, and having an ax to grind against anyone
Speaker 1: who had a different opinion than themselves and using whatever
Speaker 1: tactics they could to make that person's life miserable. So, uh,
Speaker 1: I know there are people out there still to this
Speaker 1: day who will argue that that's not really what Gamergate
Speaker 1: was about. Gammer Kate was about the games, and I'm
Speaker 1: just here to tell you that's not true. It's it
Speaker 1: was never true. There might have been people who were
Speaker 1: concerned about the games industry who got lumped into gamer Gate,
Speaker 1: but that's not what gamer Gate was about. Gamer Gate
Speaker 1: was about organized, intense harassment of people who did not
Speaker 1: deserve to have that kind of abuse heaped upon them.
Speaker 1: So Twitter, several months after gamer Gate had just got going,
Speaker 1: release some tools that were intended to help people who
Speaker 1: had become targets of abuse, So this was one small
Speaker 1: slice of what was going on in the world at
Speaker 1: that time in an effort to try and protect people
Speaker 1: who otherwise we're finding themselves on the receiving end of
Speaker 1: some truly awful behavior. Twitter would then continue to make
Speaker 1: acquisitions and grow. Uh. It bought the live streaming video
Speaker 1: service Periscope, which is an interesting story all in its own,
Speaker 1: but we're gonna skip over it because that could merit
Speaker 1: an entire episode by itself. In the spring of Twitter
Speaker 1: also announced it would begin using targeted advertising, so using
Speaker 1: data gathered from Twitter to let advertisers target specific audiences
Speaker 1: for specific types of ads. This was a critical part
Speaker 1: of Twitter's revenue strategy because the company at this time
Speaker 1: was still mostly known as that huge tech company that
Speaker 1: wasn't really making money through its business, even though it
Speaker 1: was a publicly traded company. In fact, Twitter wouldn't even
Speaker 1: have its first profitable year until a bit later, until ten,
Speaker 1: so this is not we're talking about. It would still
Speaker 1: be three years before Twitter would turn a profit. So
Speaker 1: back to Twitter's performance was again lackluster in terms of
Speaker 1: growth and user engagement, so we saw the stock price
Speaker 1: continued to kind of languish and that would keep going
Speaker 1: for the next couple of years. That explains how that
Speaker 1: stock price went from being in the sixty and seventy
Speaker 1: dollar range to drop all the way down like the
Speaker 1: fourteen to eighteen dollar range. In the summer of Dick
Speaker 1: Costello would step down as CEO and Jack Dorsey would
Speaker 1: come back to serve, at least initially as an interim
Speaker 1: CEO while the company looked for a permanent replacement. Eventually
Speaker 1: that permanent replacement ended up being Jack Dorsey, so he
Speaker 1: we just accepted that he was CEO. Twitter share price
Speaker 1: actually had a small recovery once that news published that
Speaker 1: Dorsey had come back. This idea of a company's founder
Speaker 1: having the right uh perspective and right knowledge to lead
Speaker 1: the company forward. So in November of the Twitter was
Speaker 1: once again rocking the boat. So up to that time,
Speaker 1: if you enjoyed someone's tweet, you could favorite it and
Speaker 1: that would create a little star connected to that tweet.
Speaker 1: But all of that change because favorites would become likes
Speaker 1: and stars would become hearts. Suspicions immediately on the lepre
Speaker 1: con Lucky, the mascot for Lucky Charms as being behind this.
Speaker 1: That's a bad joke. But the fact that this was
Speaker 1: even newsworthy seems ridiculous today. But I do remember back
Speaker 1: in the day when this happened, people were talking about
Speaker 1: it a lot, and yes, some people were upset by it,
Speaker 1: which seems silly. However, for Twitter, it seemed to work because,
Speaker 1: according to Twitter's metrics, user engagement increased after Twitter rolled
Speaker 1: out this change. So maybe that actually encouraged people to
Speaker 1: interact more on Twitter. Uh, it might just be one
Speaker 1: of those little psychological triggers that gets people interested. It's
Speaker 1: kind of weird. In t s, Twitter had a massive
Speaker 1: rollout of its recommended tweets offering, which meant by default,
Speaker 1: Twitter feeds would no longer be listed in reverse chronological order,
Speaker 1: at least not not completely. Instead, you would get tweets
Speaker 1: that were held for you. Say that you were looking
Speaker 1: at Twitter on Monday and then you don't look at
Speaker 1: it again until Thursday. Twitter would actually present to you
Speaker 1: some of the things you missed while you were gone,
Speaker 1: and not in the order in which they were posted,
Speaker 1: so that you know, you would see stuff that presumably
Speaker 1: you would have wanted to have seen. Well. Uh. That
Speaker 1: would also sometimes include tweets from people you don't follow,
Speaker 1: so you might get some tweets from folks that you
Speaker 1: know you never followed them, but maybe they kind of
Speaker 1: relate to stuff you do follow. Um. Anyway, this meant
Speaker 1: that you could no longer just log into Twitter and
Speaker 1: read in reverse chronological order all the stuff that the
Speaker 1: people you follow had posted, and that upsets some folks
Speaker 1: like me because it made it trickier to to actually
Speaker 1: follow what was going on, and you might be tempted
Speaker 1: to respond to something, not realizing that in fact the
Speaker 1: message you're responding to was posted hours or maybe even
Speaker 1: days earlier, and you think, oh, this was just posted
Speaker 1: because it's high up on my Twitter feed. Now, Twitter
Speaker 1: did include away for users to go in and opt
Speaker 1: out of the recommended tweets approach and go back to
Speaker 1: reverse chronological but Twitter also said hardly anyone did that,
Speaker 1: probably because it requires effort, and we know that a
Speaker 1: lot of Twitter users were upset at the change, but
Speaker 1: even more of them were too lazy to change it back.
Speaker 1: And I include myself in that two sixteen wasn't necessarily
Speaker 1: a great year for Twitter, though. This was again where
Speaker 1: those stock prices were really low and the company would
Speaker 1: end up laying off nearly ten percent of its workforce.
Speaker 1: Several high ranking Twitter executives also chose to exit stage
Speaker 1: left at this point, like people in leadership positions were
Speaker 1: jumping ship, and it led to speculation that the company
Speaker 1: was in some serious trouble. But Twitter was able to
Speaker 1: weather the storm. So even though it looked bad, Twitter
Speaker 1: was able to get through it. Okay, we're getting up
Speaker 1: to seventeen. Let's take another quick break. We'll be back
Speaker 1: and we will continue Twitter's more recent history. Okay, so
Speaker 1: now we'll skip over to November two thousand seventeen. Twitter
Speaker 1: expanded the character limit from a hundred forty characters to two,
Speaker 1: and Twitter would also allow users to display names that
Speaker 1: would be as long as fifty characters in length. At
Speaker 1: this point, Twitter was no longer beholden to SMS limitations
Speaker 1: like that had been the foundation for Twitter in the past.
Speaker 1: That was no longer the case, and Twitter was now
Speaker 1: using its own internet based distribution system. So at least
Speaker 1: that meant that you could have more space, and Twitter
Speaker 1: decided to double the amount of space that people would have,
Speaker 1: or the number of characters they could use in their
Speaker 1: messages for the short term, most tweets would remain around
Speaker 1: a hundred forty characters or fewer, with only twelve percent
Speaker 1: of messages going beyond a d forty characters at least
Speaker 1: as far as h as late two thousand eighteen. According
Speaker 1: to tech Crunch, that was the case, but for the
Speaker 1: more loquacious among us, the chatty cathy's such as yours truly,
Speaker 1: Twitter was generous and gave us the ability to create
Speaker 1: an entire thread of tweets all at once and then
Speaker 1: post them simultaneously to Twitter. So instead of posting a
Speaker 1: message and then following it up a few seconds later
Speaker 1: with another one, and then maybe like half a minute later,
Speaker 1: another one, you could craft all of them in a
Speaker 1: thread and post the entire thread at the same time.
Speaker 1: I've used that feature several times to take a more
Speaker 1: expanded approach to addressing a topic, and I've read lots
Speaker 1: of other really great Twitter threads about all sorts of stuff,
Speaker 1: from thoughts about tech to rapidly changing political situations. Now
Speaker 1: in the summer of Twitter made a change that affected
Speaker 1: some folks way more than others. And only Sometimes Twitter
Speaker 1: locks out or suspends an account for some reason, maybe
Speaker 1: the person violated Twitter's policies. Maybe Twitter figures out, oh,
Speaker 1: this account is a fake account, like there's no one
Speaker 1: behind it. It's just it's just taking up a spot.
Speaker 1: So for whatever reason, Twitter will lock those out or
Speaker 1: suspend them, and until the summer of two thousand eighteen,
Speaker 1: if some of those locked out accounts happened to be
Speaker 1: following you, they would actually count towards your follower accounts,
Speaker 1: so you can see how many people follow anyone on Twitter. However,
Speaker 1: Twitter decided to clean house in the summer of eighteen,
Speaker 1: and from that point on, any account that had received
Speaker 1: a suspension or lockout would no longer show up in
Speaker 1: follower counts. So a lot of accounts across Twitter lost
Speaker 1: thousands or tens of thousands of followers as a result,
Speaker 1: because it turned out a ton of the the quote
Speaker 1: unquote people following that account had been locked out or suspended. Now,
Speaker 1: one reason for this move is that it was a
Speaker 1: fairly common practice for folks to purchase Twitter followers. See,
Speaker 1: follower accounts are kind of like a status symbol, and moreover,
Speaker 1: they can translate into lucrative deals for people who are
Speaker 1: seen as influencers. So if I were trying to make
Speaker 1: a living as an influencer. I need brands to see
Speaker 1: me as having a ton of followers, because you know,
Speaker 1: what good is an influencer if you don't have anyone
Speaker 1: to influence. So those follower accounts are kind of like
Speaker 1: a resume when you are shopping around with brands to
Speaker 1: figure out if you could be an ambassador for that brand.
Speaker 1: And so people would buy up Twitter followers in an
Speaker 1: attempt to kind of make them seem more relevant and
Speaker 1: more influential. But Twitter would often do these big sweeps
Speaker 1: to detect accounts that were just junk or spam accounts,
Speaker 1: and once identified, those accounts would no longer factor into
Speaker 1: follower counts on influencer page, and so it became something
Speaker 1: of an embarrassment to see a person's follower account drop drastically,
Speaker 1: the implication being that most of the followers were actually
Speaker 1: spam or junk. This would not be the last time
Speaker 1: we would see activity like this. In fact, recently there's
Speaker 1: been a massive uh issue with fluctuations and follower accounts
Speaker 1: due to what Twitter calls quote an increase in new
Speaker 1: account creation and deactivation end quote. A lot of that
Speaker 1: has happened around the Elon Musk situation, which I promise
Speaker 1: we will get to. It might be this, this episode
Speaker 1: might be a long one, but we will get to
Speaker 1: Elon Musk. Anyway, let's get back to our timeline. So
Speaker 1: Congress called several tech leaders, including Jack Dorsey from Twitter,
Speaker 1: to have here before Congress to talk about the issue
Speaker 1: of election meddling in the election. Also, conservative leaders were
Speaker 1: accusing Twitter of shadow banning. So that's when a platform
Speaker 1: de emphasizes a particular accounts output so that it doesn't
Speaker 1: have as great a reach as it's supposed to. So
Speaker 1: let's give a hypothetical. Let's say that I have a
Speaker 1: hundred thousand followers, but then Twitter has shadow banned me.
Speaker 1: My posts might only reach a small percentage of my followers,
Speaker 1: maybe even less than five percent of the people following
Speaker 1: me would see my message. The other of followers wouldn't
Speaker 1: see those posts, even though they were following me. Twitter,
Speaker 1: for the record, denied that it had ever used shadow banning,
Speaker 1: and those accusing Twitter were primarily conservative politicians who claimed
Speaker 1: that platforms like Twitter and Facebook had an inherent bias
Speaker 1: against conservatives, something that I feel I need to point
Speaker 1: out has been refuted numerous times in two thousand, nineteen,
Speaker 1: Twitter revealed that it had investigated issues with fake accounts
Speaker 1: linked to foreign agents that were engaged in conversations around
Speaker 1: US politics and social movements. Essentially, Twitter acknowledged that there
Speaker 1: were missing forformation campaigns that we're playing out over Twitter,
Speaker 1: and the accounts were mostly linked to places like Iran
Speaker 1: and Russia. Dorsey would again appear before Congress in twenty
Speaker 1: at a hearing called Breaking the News, Censorship, Suppression, and
Speaker 1: the Election. This time, conservatives went after Twitter even harder,
Speaker 1: arguing that there was this bias on Twitter, despite you know,
Speaker 1: not actually having evidence to show that there was bias.
Speaker 1: Twitter was, however, taking action against accounts that were actively
Speaker 1: spreading misinformation, particularly about the coronavirus, because by now we're
Speaker 1: into the actual pandemic, and some of the accounts that
Speaker 1: were pushing misinformation happened to belong to high profile conservative figures,
Speaker 1: including then President Donald Trump. Now even the President wasn't
Speaker 1: excused from Twitter's content policies, and so the platform had
Speaker 1: labeled some posts containing misinformation and otherwise restricted the spread
Speaker 1: of that misinformation, which fueled these accusations of this anti
Speaker 1: conservative bias, where it really it was an anti misinformation policy,
Speaker 1: not an anti conservative bias. Twitter had also restricted the
Speaker 1: spread of tweets from the media outlet The New York Post,
Speaker 1: which had published articles about Hunter Biden, son of Joe Biden,
Speaker 1: and the claims against Hunter Biden had not been verified
Speaker 1: by any other trusted media outlet, so Twitter was taken
Speaker 1: the stance that since the claims appeared to be unsubstantiated,
Speaker 1: they would therefore qualify as misinformation. But those actions were
Speaker 1: enough to fuel the conservative claims that Twitter was anti conservative,
Speaker 1: which is a narrative that continues to this day. And
Speaker 1: then a year later, in one Dorsey once again got
Speaker 1: called to testify in front of Congress, virtually at this
Speaker 1: point because we're still talking pandemic here. This time the
Speaker 1: subject was about the insurrection in the United States on
Speaker 1: January six, two thousand twenty one, which included the storming
Speaker 1: of the US Capitol Building. Congress wanted to know what role,
Speaker 1: if any, social media played in the radicalizing and organizing
Speaker 1: of groups that were involved in the violent acts of
Speaker 1: that day. We're still learning facts relevant to the questions
Speaker 1: asked back then during those those Congressional hearings, and that's
Speaker 1: been more than a year since then, and to jump
Speaker 1: off on a little bit of a tangent, I think
Speaker 1: it's entirely fair to say that social networks facilitate radicalization
Speaker 1: and in some cases even promote radicalization. We've talked in
Speaker 1: the past about how various recommendation algorithms can reinforce radical
Speaker 1: messages and create a situation in which a person is
Speaker 1: presented with radical viewpoints repeatedly, thus reinforcing these beliefs. And
Speaker 1: this doesn't happen in a vacuum. Of course, I would
Speaker 1: never go so far as to say that social platforms
Speaker 1: are solely responsible for radicalization. That would be untrue, but
Speaker 1: it does seem fair to at least say that social
Speaker 1: platforms play a part in this, and depend upon the
Speaker 1: recommendation algorithms being used, it could be an important part
Speaker 1: of radicalizing and recruitment. Anyway, back to Twitter. In late one,
Speaker 1: Jack Dorsey stepped down as Twitter CEO. The company's chief
Speaker 1: technology officer, parag Agreval, replaced Dorsey, and you might wonder, Okay,
Speaker 1: so why did Jack Dorsey step down? Now? He said
Speaker 1: it was because Twitter was ready to move beyond the
Speaker 1: vision of its founders, but he was also still helming
Speaker 1: Square he was still acting as CEO of Square, which
Speaker 1: was something that was requiring a lot of his time
Speaker 1: and focus, and that meant that Twitter would end up
Speaker 1: being treated like a redheaded stepchild, as they say, with
Speaker 1: Dorsey not devoting at least his full attention to help
Speaker 1: grow the company. So people were saying that Dorsey wasn't
Speaker 1: giving Twitter the amount of attention needed to make Twitter
Speaker 1: a success. Instead, he was dividing his attention between Twitter
Speaker 1: and Square, and so do or See ended up stepping
Speaker 1: back and saying, all right, I'm gonna just focus on Square. Also,
Speaker 1: it's possible that he was tired of being called up
Speaker 1: to appear in front of Congress at that point, because
Speaker 1: he had had to do it three times in four years,
Speaker 1: and that's a lot. And then we get to this
Speaker 1: year two and Elon Musk's announcement that he intended to
Speaker 1: purchase Twitter. Uh Now, before that even happened, news broke
Speaker 1: that Musk had purchased nine point two percent of Twitter's
Speaker 1: stock on April fourth, two thousand twenty two. At that time,
Speaker 1: that made him the largest single shareholder in Twitter. That
Speaker 1: revelation led to Twitter shares jumping in value, and on
Speaker 1: Friday April one, Twitter was trading at thirty nine dollars
Speaker 1: thirty one since per share, so that's before the announcement.
Speaker 1: Then on Monday, April four, when news broke that Elon
Speaker 1: Musk had made this huge purchase, the closing price was
Speaker 1: up to forty nine dollars nine cents per share, So
Speaker 1: I went from thirty nine thirty one to that's a
Speaker 1: significant jump. It really shows how people were thinking, if
Speaker 1: Musk is buying this much, something must be going on
Speaker 1: with Twitter. And immediately there were discussions about whether Musk
Speaker 1: was angling to get a seat at the board of
Speaker 1: directors or maybe even preparing for an actual takeover of Twitter.
Speaker 1: Speculation reigned for more than a week before it became
Speaker 1: clear that Musk really was moving to purchase the company,
Speaker 1: and it would take another week before that would really
Speaker 1: start to settle into something certain and we would learn
Speaker 1: of the terms. On April twenty two, uh, we learned
Speaker 1: that Musk had agreed to buy out shares of Twitter
Speaker 1: at fifty four dollars twenty sins per share, which was
Speaker 1: significantly higher than what he would have paid for those shares,
Speaker 1: and after some debate at the board level, Twitter had
Speaker 1: agreed to that price. It seemed at first that the
Speaker 1: company was going to resist Elon Musk's move. It went
Speaker 1: so far as to put a poison pill plan in ace.
Speaker 1: That's a lot of alliteration, um. A poison bill is
Speaker 1: a strategy to try and head off a hostile takeover.
Speaker 1: A hostile takeovers when someone convinces shareholders to make really
Speaker 1: big changes to a company's ownership by going over the
Speaker 1: head of the board of directors. So instead of arranging
Speaker 1: things through the board of directors, you go and you
Speaker 1: try and buy up enough shares to force a shareholder
Speaker 1: vote to potentially change the ownership of the company. That's
Speaker 1: that's a hostile takeover. A poison pill is a way
Speaker 1: for a company to affect share price or the number
Speaker 1: of shares in such a way that it makes a
Speaker 1: hostile takeover impractical or impossible. Anyway, all of that ended
Speaker 1: up being moot because Twitter's board ultimately agreed to Elon's
Speaker 1: terms on April uh. The deal meant that Musk waved
Speaker 1: his right to due diligence, which is sort of like
Speaker 1: agreeing to buy a house site unseen and just hope
Speaker 1: that you didn't overpay for whatever you bought. There's also
Speaker 1: a clause in the deal that states if Musk were
Speaker 1: two back out of the deal, which could only have
Speaker 1: and if there were a situation that fundamentally meant Twitter's
Speaker 1: value would be drastically different from what it should be,
Speaker 1: then Musk would still be on the hook to pay
Speaker 1: a one billion dollar exit price. So, in other words,
Speaker 1: first the deal has to be untenable because of some
Speaker 1: fundamental reason, then Musk would be allowed to back out,
Speaker 1: but you have to pay a billion dollars to do it.
Speaker 1: As it turns out, that part is going to be
Speaker 1: really important now. Since the day that the news broke
Speaker 1: that Musk was gonna try and buy Twitter, hardly a
Speaker 1: day has gone by without more Musk and Twitter news.
Speaker 1: It's frankly exhausting. Part of the problem is that Musk
Speaker 1: initially talked about how his goals involved making Twitter a
Speaker 1: platform for free speech, with Musk implying that some of
Speaker 1: the criticisms about Twitter's content moderation policies were merited. So again,
Speaker 1: this starts to play into that perception that Twitter has
Speaker 1: this anti conservative bias or that it made a mistake to,
Speaker 1: you know, limit the spread of misinformation about stuff like
Speaker 1: COVID and election manipulation and that sort of thing. So
Speaker 1: Musk's message seems to indicate that his version of Twitter
Speaker 1: would reverse some of these actions, making it a true
Speaker 1: free speech platform, which by the way, it can't actually do,
Speaker 1: at least not all over the world because there's some
Speaker 1: places that have very strict content policies, you know, like India.
Speaker 1: So some of the things that people have guessed Musk
Speaker 1: might do include some controversial moves, like even reinstating former
Speaker 1: President Trump's account. One thing I didn't cover is that
Speaker 1: President Trump lost his account in the wake of the
Speaker 1: January six insurrection in um he continuously violated Twitter's policies,
Speaker 1: and Twitter then banned his account. So there's been some
Speaker 1: speculation that Musk would reverse that decision, but obviously we
Speaker 1: can't speak to that one way or the other because
Speaker 1: it hasn't happened yet. Okay, we're gonna take one last break.
Speaker 1: When we come back, I'm gonna talk more about this
Speaker 1: Musk Twitter situation. Okay, So, another big thing that Musk
Speaker 1: talked about early on when it became known that he
Speaker 1: was he was moving to purchase Twitter was his goal
Speaker 1: to wipe out bots on Twitter spam bots and junk bots.
Speaker 1: He identified that as one of the big problems on Twitter,
Speaker 1: one of the problems being this, uh, this, this position
Speaker 1: on free speech, like being anti free speech, and and
Speaker 1: Elon Musk's eyes. The other one being that there was
Speaker 1: there were too many bots on Twitter and need to
Speaker 1: be cleaned out. There need to be a verification process
Speaker 1: to make sure that whomever holds a Twitter account is
Speaker 1: in fact a human being. Now, later on, he began
Speaker 1: to use the bots as a reason that he wasn't
Speaker 1: so sure that the deal should go through, which again
Speaker 1: is confusing because at the very earliest stages he was
Speaker 1: saying one of his goals was to clean up Twitter
Speaker 1: from bots, like that was one of the reasons he
Speaker 1: wanted to purchase it. So it's somewhat confusing that a
Speaker 1: bit later he's like, hey, hey, I don't think I
Speaker 1: want to buy this anymore. There are bots on it,
Speaker 1: and and and meanwhile I'm sitting here saying, you knew
Speaker 1: there were bots on it, that was one of the
Speaker 1: reasons you said you wanted to buy the thing. Um,
Speaker 1: But hey, you know, who am I to judge? I
Speaker 1: guess anyway, I found it really frustrating because you know,
Speaker 1: it seemed like he was going backward and saying like, oh,
Speaker 1: I didn't realize there were bots here. So he began
Speaker 1: to demand information on how many bots are actually on Twitter.
Speaker 1: Twitter came back and said that, according to their estimates,
Speaker 1: fewer than five percent of all monetize herbal accounts on
Speaker 1: Twitter or bots. Musk disputed that. He just said that's
Speaker 1: not true. He didn't present evidence of that not being true,
Speaker 1: but he said that's not true, and he suspected the
Speaker 1: number was much higher. Uh, and by much higher, it
Speaker 1: went anywhere from to more than nine percent in some accounts,
Speaker 1: which more than seems more than a little unrealistic to me,
Speaker 1: but whatever. Anyway, Twitter would go on to actually send
Speaker 1: raw data to Musk's team. They said, you know, we
Speaker 1: told you what our methodology was, we told you what
Speaker 1: we found. You said, that's not true. So here's the
Speaker 1: raw data. You figure it out, You come up with
Speaker 1: your approach to determine how many bots are on the platform,
Speaker 1: and you let us know what you found. Now. Most recently,
Speaker 1: Musk has indicated that he wants out of this deal
Speaker 1: due to the bot issue, which again I'm not really
Speaker 1: sure what's that actually going on here, but his legal
Speaker 1: team may have to argue that reason in court because
Speaker 1: Twitter's board of directors have indicated that they're holding Musk
Speaker 1: to his agreement that they will sue him. They will
Speaker 1: take him to court over this matter if he tries
Speaker 1: to back out of the deal, and if a court
Speaker 1: decides that the bought issue is not crucial to Twitter's
Speaker 1: value right, that it doesn't meet that bar that must
Speaker 1: be met in order for Musk to be able to
Speaker 1: back out of the deal, well, then Musk is gonna
Speaker 1: have to go through with it. He's gonna have to
Speaker 1: bite the bullet and purchase the company for like forty
Speaker 1: four billion dollars, which is what he agreed to. The
Speaker 1: activity has led to massive speculations about what Musk's motives
Speaker 1: have been, and theories have been posted everywhere from like
Speaker 1: sub Credits and Twitter to mainstream media. So let's run
Speaker 1: down a couple of the big hypotheses of what's quote
Speaker 1: unquote really going on here now. One is that Musk
Speaker 1: actually wanted to buy Twitter, that that he was sincere
Speaker 1: in his desire to purchase the platform, but then a
Speaker 1: downturn in the economy made that more expensive than Musk
Speaker 1: was comfortable going with the value of Twitter's stock dropped,
Speaker 1: and so did Tesla's stock value. Now a lot of
Speaker 1: Musk's personal wealth is tied in with Tesla stock. Like
Speaker 1: Musk is the world's richest man, but it's not like
Speaker 1: he has billions of dollars in a bank vault Allah
Speaker 1: Scrooge mc duck. Most of his money is tied up
Speaker 1: in stocks, including Tesla stocks. So some have said that
Speaker 1: Musk wants out of the deal because his personal wealth
Speaker 1: has already taken a heck of a clubbing due to
Speaker 1: Tesla's stock performance, because that that stock price of that
Speaker 1: company has gone down significantly since the spring. Also, not
Speaker 1: all the cash to buy Twitter is actually coming from
Speaker 1: Elon Musk himself. In fact, most of it is coming
Speaker 1: from other sources. He had to secure a few financial
Speaker 1: partners to get funding, so of a lot of this
Speaker 1: is him putting up stock as collateral in order to
Speaker 1: get the funding necessary to make this purchase. And again,
Speaker 1: if the stock price for Tesla is going down, then
Speaker 1: it requires more shares of Tesla to meet that collateral,
Speaker 1: which means he's putting up even more of his personal
Speaker 1: wealth up as a in a way to guarantee alone.
Speaker 1: Rich people, by the way, mostly are buying things on credit,
Speaker 1: and they're using the wealth they have and things like
Speaker 1: stocks as collateral, so they're not they live in a
Speaker 1: totally different world that I live in. But anyway, once
Speaker 1: things are going boldly in the stock market, that makes
Speaker 1: this more uh personally costly for Elon Musk. It means
Speaker 1: he has to dedicate more of his personal assets towards
Speaker 1: establishing the collateral he needs in order to get the
Speaker 1: loans he needs. So it's harder for him to get
Speaker 1: the money together to buy Twitter, and that that might
Speaker 1: be making must have second thoughts that he wants out
Speaker 1: of the deal because he doesn't want to commit that
Speaker 1: much of his own personal wealth to the to the endeavor.
Speaker 1: But there's another hypothesis as well, and this one says
Speaker 1: that Musk never intended to buy Twitter in the first place. Instead,
Speaker 1: he just wanted to have a reason to liquefy some
Speaker 1: of his stocks in Tesla without triggering a larger negative
Speaker 1: reaction to him doing that. And here's the thinking. So
Speaker 1: when a leader sells off a big old chunk of
Speaker 1: stock in the company that they lead, other investors might
Speaker 1: see that as a sign that the leader has lost
Speaker 1: confidence in their company. So the investors then may also
Speaker 1: move to sell off their shares. That results in a
Speaker 1: stock price drop, perhaps even a drastic one. So then
Speaker 1: the question is, how can a leader liquefy a significant
Speaker 1: amount of stock to the tune of more than eight
Speaker 1: billion dollars in the case with Elon Musk and Tesla
Speaker 1: without causing that kind of panic among investors. Well, according
Speaker 1: to this hypothesis, Musk's approach was to make it appear
Speaker 1: as though he were going to purchase Twitter. And obviously,
Speaker 1: in order to purchase Twitter, he would have to fund
Speaker 1: that purchase. And you know the overall price when you
Speaker 1: add up those fifty four dollars twenty since per share
Speaker 1: would be around forty four billion dollars. So as part
Speaker 1: of that, Musk would need to liquefy some of his
Speaker 1: stock in Tesla in order to have cash as part
Speaker 1: of his offer to Twitter. So the sell off of
Speaker 1: Tesla stock would thus be seen as a business move
Speaker 1: for Musk to acquire another company, not that Musk wanted
Speaker 1: to sell his shares or had somehow lost confidence in
Speaker 1: Tesla itself, Because while he was selling a lot of
Speaker 1: stock he still owns, more like he still owns of
Speaker 1: all the shares in Tesla. So maybe, say the speculators,
Speaker 1: Musk was looking to cash in on eight point four
Speaker 1: billion dollars worth of Tesla stock without tanking share prices
Speaker 1: of Tesla, and he used Twitter as kind of a
Speaker 1: cover story with the intent of never going through with
Speaker 1: the deal. But if that is the case, he made
Speaker 1: some pretty darned stupid business decisions when he was forging
Speaker 1: that deal with Twitter, because backing out is not an
Speaker 1: easy thing to do, and if even if he does
Speaker 1: manage to back out, he's going to have to pay
Speaker 1: a billion dollar fee. So maybe he was willing to
Speaker 1: spend a billion in order to cash out eight point
Speaker 1: four billion, But if so, this was a dumb way
Speaker 1: to do it, because if his lawyers can't convince a
Speaker 1: court that sacking out is justified, he's still going to
Speaker 1: have to go through with the purchase, or what I
Speaker 1: think is more likely is go through a much more
Speaker 1: expensive settlement where he'll pay out not the full forty
Speaker 1: four billion dollars, but it's going to be more than
Speaker 1: the one billion fee he would have incurred if he
Speaker 1: could back out. Musk is currently showing a lot of
Speaker 1: bravado in the face of threats from Twitter to bring
Speaker 1: the case to court. Musk says this is going to
Speaker 1: vindicate his claims that Twitter is going to be forced
Speaker 1: to reveal actual bot statistics in a courtroom. Like he says,
Speaker 1: I asked Twitter to give me real statistics on bots.
Speaker 1: Twitter refused. Twitter then says it's going to take me
Speaker 1: to court. But in court, it's going to have to
Speaker 1: show those bots statistics, so I win. Ha ha ha
Speaker 1: ha ha. Now I'm no legal expert. I don't know
Speaker 1: if that's going to be part of the case. I
Speaker 1: don't know if Twitter can just say, hey, we sent
Speaker 1: Musk everything. We sent him the fire hose of data.
Speaker 1: He's complaining about nothing, So make him go through through
Speaker 1: with the deal and make him buy us, and that
Speaker 1: might be what the court decides. So yeah, this isn't over.
Speaker 1: I don't know whether Musk will end up owning Twitter
Speaker 1: or not at this point. Um, I definitely think it's
Speaker 1: going to go to court. I don't think Musk is
Speaker 1: gonna win. So either he's going to have to pay
Speaker 1: a big settlement to get out of this, or he's
Speaker 1: going to have to bite the bullet and purchase Twitter.
Speaker 1: I don't see it going another way. Now I could
Speaker 1: be wrong. Maybe a court will find that Musk's reasons
Speaker 1: for backing out are legitimate and they meet the qualifications
Speaker 1: required by the deal, and he'll only owe the one
Speaker 1: billion dollars and then that will be that. Um, I
Speaker 1: think Twitter is going to take a big hit in
Speaker 1: its value if that happens. So we'll have to see
Speaker 1: how this plays out. But yeah, that's the update on
Speaker 1: Twitter's tumultuous history. A lot has happened in just the
Speaker 1: last few months, in fact, that you could argue with
Speaker 1: that Twitter's history got way more complicated since April of
Speaker 1: this year than in the rest of its history combined.
Speaker 1: And I think you'd have a pretty strong argument there.
Speaker 1: I'm sure once this comes to some sort of definitive end,
Speaker 1: whatever that may be, I will come back and revisit it,
Speaker 1: maybe do a much shorter kind of update episode. But
Speaker 1: I wanted to do this to talk about it because, um, yeah,
Speaker 1: it's it's a weird situation and Twitter has been such
Speaker 1: an important component in tech and in journalism and an
Speaker 1: activism as well as in you know, not great stuff
Speaker 1: like in organized campaigns of harassment and election meddling and
Speaker 1: misinformation campaigns like Twitter has been at the center of
Speaker 1: all this. I think it would be foolish to say
Speaker 1: that Twitter is not important. I think it's not foolish
Speaker 1: to say Twitter is in trouble because it hasn't like
Speaker 1: it's not growing really and it's not becoming more relevant.
Speaker 1: It's not like it's increasing user engagement either. But you
Speaker 1: can still see where it plays an important part. The
Speaker 1: question is isn't an important enough part for it to
Speaker 1: justify its existence? And I just don't know, Like when
Speaker 1: when the world eventually boils down to how much money
Speaker 1: did you make? It starts getting pretty complicated. Okay, that's
Speaker 1: it for this episode. Hope you enjoyed it. If you
Speaker 1: have anything you would like to send me, well, why
Speaker 1: don't you send it on Twitter. I'm just gonna talk
Speaker 1: about Twitter on this one. You could do that by
Speaker 1: sending a message to tech Stuff HSW on Twitter, and
Speaker 1: I'll talk to you again really soon. Tech Stuff is
Speaker 1: an I Heart Radio production. For more podcasts from my
Speaker 1: Heart Radio, visit the I Heart Radio app, Apple Podcasts,
Speaker 1: or wherever you listen to your favorite shows. Two