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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowTesla CEO Elon Musk has acquired a 9% stake in Twitter to become its largest shareholder while joining other critics in questioning the social media platform’s dedication to free speech and the First Amendment.
Musk’s ultimate aim in acquiring 73.5 million shares, worth about $3 billion, isn’t clear. Yet, in late March, Musk, who has 80 million Twitter followers and is active on the site, questioned free speech on Twitter and whether the platform is undermining democracy.
In years past, Twitter and other social platforms have taken fire for allowing harmful speech ranging from incitement to violence to coordinated harassment and racial abuse. More recently, these platforms have made concerted efforts to rein in such behavior, often drawing criticism similar to Musk’s from the political right. Both Twitter and Facebook faced blowback after suspending the accounts run by former President Donald Trump following the Jan. 6 Capitol insurrection last year.
It’s unclear just when Musk bought the stake. A U.S. Securities and Exchange Commission filing made public on Monday says the event triggering the filing happened March 14. Musk has also raised the possibility with his massive and loyal Twitter following, that he could create a rival social media network.
Twitter’s stock surged nearly 30% Monday before closing up 27.1%, at $49.97 per share. Since March 14, its shares are up nearly 50%, meaning that Musk’s investment has paid handsomely—so far.
Industry analysts and legal experts say Musk could begin advocating for changes at Twitter immediately if he chooses. In a note to investors, CFRA Analyst Angelo Zino wrote that Twitter could be viewed as an acquisition target because the value of its shares have been falling since early last year.
Twitter co-founder Jack Dorsey stepped down as CEO in November. Musk’s stake in Twitter is now more than four times the size of Dorsey’s, who had been the largest individual shareholder.
“Musk’s actual investment is a very small percentage of his wealth, and an all-out buyout should not be ruled out,” wrote Zino, who covers Twitter and social media.
Musk could see Twitter as an investment with big growth ahead, or he could have noninvestment reasons for the purchase, such as buying to make sure the platform doesn’t restrain his speech, said Erik Gordon, a law and business professor at the University of Michigan.
“What he could be worried about is if enough of his tweets start to look like disinformation, that Twitter says ‘we’re doing our job against disinformation.’” Gordon said. No CEO would refuse to take a call from the company’s top shareholder, so the purchase gives Musk access to Twitter’s top management, he said.
Musk has not spoken specifically about any Twitter rule changes he might push, but the social media platform’s history of suspensions and bans is well documented.
Trump’s suspension from both Twitter and Facebook has raised difficult questions about free speech in a social media industry dominated by a few tech giants—an issue that Trump and conservative media have seized upon. There was broad praise for Musk from those circles Monday.
Michael Flynn, the retired general who served briefly as Donald Trump’s national security adviser, and who was suspended from Twitter in January 2021, sent Musk some free advice via Telegram.
“Hey Elon, how about letting all of those dropped from twitter for being America First and Pro-Trump back on Twitter!!!,” Flynn wrote.
Twitter earlier this year banned the personal account of far-right U.S. Rep. Marjorie Taylor Greene for multiple violations of the platform’s COVID-19 misinformation policy. Other people banned in recent years include Steve Bannon, for suggesting the beheading of Dr. Anthony Fauci, former Ku Klux Klan leader David Duke for breaking the social media site’s rules forbidding hate speech, and right-wing conspiracy theorist Alex Jones and his Infowars show for abusive behavior.
Musk recently described himself on Twitter as a “free speech absolutist” in explaining why the Starlink satellite internet service—part of his aerospace company SpaceX—would not block Russian state media outlets, which have spread propaganda and misinformation in line with the Kremlin’s narrative on its war in Ukraine.
But such absolutism would not be welcome by advertisers who are Twitter’s chief revenue source, said Brian Wieser, global president of business intelligence at GroupM. Brands that advertise on Twitter strongly prefer some content standards because a toxic platform can drive many other users away.
“Certain kinds of speech, such as advocating an insurrection or advocating hurting people, are not the kinds of things most advertisers want to support,” said Wieser, who analyzes the media industry for advertisers.
Twitter did not immediately respond to a request for comment.
In March, Musk told his millions of followers on Twitter that he was “ giving serious thought ” to creating his own social media platform, and has clashed repeatedly with financial regulators about his use of Twitter.
Musk is locked into a bitter dispute with the SEC over his ability to post on Twitter. His lawyer has contended in court motions that the SEC is infringing on the Tesla CEO’s First Amendment rights.
In October of 2018, Musk and Tesla agreed to pay $40 million in civil fines and for Musk to have his tweets approved by a corporate lawyer after he tweeted about having the money to take Tesla private at $420 per share.
The funding was far from secured and the electric vehicle company remains public, but Tesla’s stock price jumped. The settlement came after the SEC brought a securities fraud charge. It specified governance changes, including Musk’s ouster as board chairman, as well as pre-approval of his tweets.
Musk’s lawyer is now asking a U.S. District Court judge in Manhattan to throw out the settlement, contending that the SEC is harassing him and infringing on his First Amendment rights.
The SEC says it has legal authority to subpoena Tesla and Musk about his tweets, and that Musk’s move to throw out the settlement is not valid.
The SEC also disclosed that it is investigating Musk’s Nov. 6, 2021 tweets that asked followers whether he should sell 10% of his Tesla stake. The commission said it issued administrative subpoenas while investigating whether Musk and Tesla are complying with disclosure controls in the 2018 agreement.
Musk ended up selling more than 15 million shares worth roughly $16.4 billion. With some sales in late December, Musk is close to selling 10%.
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This could get interesting.
The same person who once banned a journalist from buying one of his cars when he was criticized for a poorly run launch event is going to “fix” free speech. Sure.
Because what Twitter needs is to be more like Gab and Parler and all those “unfiltered” sources.Turns out moderation is a good thing and it’s something any website is going to have to deal with.
Most of Twitter’s problems could be simply solved by making people sign up with a credit card. Don’t even have to charge them…
Free Speech is no problem Joe, as long as they are Libs like you. It’s the other side of the aisle that gets canceled. For the record, I agree Trump is a vile embarrassment, but oddly BLM still has their account.
Liberal like me. Sure, Chuck. Keep telling yourself that I’m the problem, the guy who isn’t conservative enough.
Conservatives loved the marketplace of ideas until their ideas were rejected by the same marketplace. Instead of listening to the market, you all yammer on about how “woke” everyone is and claiming you’re being censored by private companies and you should impose the First Amendment upon them.
This is the issue with most all of you so-called conservatives – you don’t realize how far off the deep end you’ve gone. You’re in your echo chamber thinking that anyone who disagrees with anything, who isn’t 100% compliant, is disloyal and “liberal” and not “real Americans” anyway. News you don’t like is fake news. Election results you don’t like are rigged. Everything is not your fault. You’re like dealing with a teenager, it’s ponderous.
You want Putin’s Russia because that’s what you think America once was way back in the 50’s… which is laughably inaccurate unless maybe you thought Joe McCarthy was on the right path.
Joe, you cite RightWingWatch and MediaMatters on your arguments with people here. Seriously, that is no better than InfoWars in terms of hyperpartisan conspiracy mongering. (And yes, I am criticizing InfoWars for engaging in conspiracy mongering.) Let’s not pretend for a minute that you are some sort of centrist. Maybe you were at one point, but you clearly hate Trump with a virulent raging passion and have decided that ally with anyone and anything that shares that hatred. You’re as entrenched in your echo chamber as the people you like to flog.
Like anyone with no self-awareness, every accusation you lob here can apply just as much to yourself. Second only to Wesley, are the among the most relentless embodiments of confirmation bias.
Do you care to make a point or have you just resorted to the personal attacks?
I mean, time was I actually thought Rush Limbaugh was a conservative commentator worth listening to and influencing my thinking … as opposed to a performer telling people what they wanted to hear.
I also used to think media bias charts were useful. People change.
By the way, “Lauren”, since we are going to take pot shots at people’s past, care to list any other nom de plume‘s you’ve used in the past?
I thought Donald Trump was an awful candidate in 2015. He’s yet to prove me wrong. Everything he touches in his life eventually dies, and we can only hope that his version of the Republican Party collapses sooner rather than later and takes all the grifters and clowns and posers with it. Let them go live in Russia and enjoy their version of “American democracy”.
Oh, and go on and define for me what a centrist, conservative, and far right conservatives are … along with notable examples.