Elon Musk completes Twitter deal, fires CEO Parag Agarwal among other top executives

Agencies | New York                 

The Daily Tribune – www.newsofbahrain.com  

Elon Musk has taken control of Twitter and ousted the CEO, chief financial officer and the company’s general counsel, two people familiar with the deal said on Thursday night.

They stated that Musk, who was now in charge of the social media platform, fired CEO Parag Agrawal, CFO Ned Segal and General Counsel Vijaya Gadde. Neither of these two sources wanted to be identified because of the sensitive nature of the personnel shifts.

The departures come just hours before a deadline set by a Delaware judge to finalise the deal on Friday. She threatened to schedule a trial if no agreement was reached.

Elon Musk attempted to soothe leery Twitter advertisers on Thursday — a day before a deadline to close out on his $44 billion acquisition of the social media platform, saying that he was buying it to help humanity and prevent it from turning into a “free-for-all hellscape".

The message appears to be aimed at addressing concerns among advertisers — Twitter’s chief source of revenue — that Musk’s plans to promote free speech by cutting back on moderating content would open the floodgates to more online toxicity and drive away users.

“The reason I acquired Twitter is because it is important to the future of civilisation to have a common digital town square, where a wide range of beliefs can be debated in a healthy manner, without resorting to violence,” Musk wrote in an uncharacteristically long message for the Tesla CEO, who typically projects his thoughts in one-line tweets.

He continued: “There is currently great danger that social media will splinter into far right wing and far left wing echo chambers that generate more hate and divide our society.”

The Tesla CEO has previously expressed distaste for advertising and Twitter’s dependence on it, suggesting more emphasis on other business models, such as paid subscriptions that won’t allow big corporations to dictate policy on how social media operates. However, on Thursday, he assured advertisers that he wanted Twitter to be “the most respected advertising platform in the world".

The note is a shift from Musk's position that Twitter was unfairly infringing on free speech rights by blocking misinformation or graphic content, said Pinar Yildirim, associate professor of marketing at the University of Pennsylvania’s Wharton School.

It is also a realisation that having no content moderation is bad for business, putting Twitter at risk of losing advertisers and subscribers, she said.

“You do not want a place where consumers just simply are bombarded with things they do not want to hear about, and the platform takes no responsibility."

Musk declared that Twitter should be “warm and welcoming to all”, with the power to enable users to choose the experience they wanted to have.

“I didn’t do it to make money,” he said of the pending acquisition.

“I did it to try to help humanity, whom I love. And I do so with humility, recognising that failure in pursuing this goal, despite our best efforts, is a very real possibility.”

Friday’s deadline to close the deal was ordered by the Delaware Chancery Court in early October. It is the latest step in a battle that began in April with Musk signing a deal to acquire Twitter, after which he tried to back out of it, leading Twitter to sue the Tesla CEO to force him to go through with the acquisition. If the two sides don’t meet Friday's deadline, the next step could be a November trial that could lead to a judge forcing Musk to complete the deal.

Musk has been signalling that the deal is going through. He strolled into the company’s San Francisco headquarters on Wednesday carrying a porcelain sink, changed his Twitter profile to “Chief Twit," and tweeted “Entering Twitter HQ — let that sink in!”

Overnight, the New York Stock Exchange notified investors that it would suspend trading in shares of Twitter before the opening bell on Friday, in anticipation of the company going private under Musk.

On Friday, Musk is expected to speak to Twitter employees directly if the deal is finalised, according to an internal memo cited in several media outlets. Despite internal confusion and low morale tied to fears of layoffs or a dismantling of the company's culture and operations, this week, Twitter's leaders have at least outwardly welcomed Musk's arrival and messaging.

Top sales executive Sarah Personette, the company's chief customer officer, said she had a “great discussion” with Musk on Wednesday, and appeared to endorse his Thursday message to advertisers.

“Our continued commitment to brand safety for advertisers remains unchanged,” Personette tweeted Thursday. “Looking forward to the future!”

Musk's apparent enthusiasm about visiting Twitter's headquarters this week stood in sharp contrast to one of his earlier suggestions: that the building should be turned into a homeless shelter because so few employees actually worked there.

The Washington Post reported last week that Musk told prospective investors that he planned to cut three quarters of Twitter’s 7,500 workers when he became the owner of the company. The newspaper cited documents and unnamed sources familiar with the deliberation.

Musk has spent months deriding Twitter's “spam bots" and making sometimes contradictory pronouncements about Twitter's problems and how to fix them. Nevertheless, he has shared a few concrete details about his plans for the social media platform.

Thursday's note to advertisers shows a newfound emphasis on advertising revenue, especially a need for Twitter to provide more “relevant ads” — which typically means targeted ads that rely on collecting and analysing users' personal information.

Yildirim said that, unlike Facebook, Twitter has not been good at targeting advertising to what users want to see. Musk’s message suggests he wants to fix that, she said.

According to a CNN report, Musk’s arrival could also lead to the return of Jack Dorsey's influence over the company, in some form. Dorsey had stepped down as the CEO in November, and left its board in May.

Although he has said that he would not formally return to Twitter, he has privately discussed the logistics of the issue with Musk, offering his advice at times.

Insider Intelligence principal analyst Jasmine Enberg said that Musk has good reason to avoid a massive shake-up of Twitter’s ad business, because Twitter's revenues have taken a beating from the weakening economy, months of uncertainty surrounding Musk's proposed takeover, changing consumer behaviour, and the fact that "there's no other revenue source waiting in the wings".

“Even slightly loosening content moderation on the platform is sure to spook advertisers, many of whom already find Twitter’s brand safety tools to be lacking compared with other social platforms,” Enberg said.