Twitter loses users, share price falls after Elon Musk's bid confirmed
Investors and users remain unsure about Elon Musk's approach to acquiring and operating Twitter, with the company's share price continuing to decline.
Elon Musk's accepted proposal to purchase Twitter for $44 billion has investors and users wary of the future of the company. While shareholders are worried about Musk's financing following Tesla's share price drop, users are unsure how the richest man in the world plans to change the social media platform.
On Tuesday, Tesla's stock dropped by 12.2 percent wiping out $126 billion in market value, over fears that Musk would be leveraging his holdings in the company to pay for Twitter.
This, in turn, has Twitter shareholders fearing that Musk might not be able to easily finance his purchase of the social media company, with the company's stock price dropping to $48.68 despite Musk's guarantee of purchasing all Twitter stocks at $54.20 in his proposal.
Tesla's stock price drop wiped out $21 billion in Musk's fortune, which is similar to the amount he had personally pledged to put up in cash for the Twitter acquisition. Meanwhile, it was reported yesterday that Musk would only have to pay $1 billion as a termination fee should he decide to walk away from the deal, or fail to find the required financing.
Elon Musk, Founder of Tesla
Twitter loses hundreds of thousands of users
According to a report by analytics site Social Blade, Twitter has lost hundreds of thousands of users since Elon Musk's bid to purchase the platform was confirmed. The Guardian reports that Twitter confirmed that these were largely organic users who had dropped off, rather than bots being deactivated.
This drop seems to be centred around left-wing users in the West, with accounts such as former US President Barack Obama, former First Lady Michelle Obama, British Labour leader Jeremy Corbyn and pop stars like Katy Perry and Taylor Swift losing thousands of followers each.
Meanwhile, right-wing usage of the platform seems to have increased, with US Republicans Ted Cruz and Marjorie Taylor Greene seeing hundreds of thousands of new followers. British Prime Minister Boris Johnson also saw a spike in his following.
Elon Musk's tweets since his bid was accepted seem to also suggest a shift towards re-admitting controversial right-wing figures back into the fold while reducing moderation of potentially false information that has disproportionately affected right-wing users in the recent past.
Musk has also been criticised for inadvertently supporting attacks against the Twitter legal team, by saying that their decision to censor certain political articles was "incredibly inappropriate." This condemnation led to his followers attacking the person named as part of the moderation team for these censorships.
In response, former Twitter CEO Dick Costolo said, "bullying is not leadership," to which Musk took exception. He repeated again that he believes Twitter should be "politically neutral" without expanding on what that means.
It might be interpreted that Musk's criticism of Twitter staff on their previous moderation policies might be in violation of the anti-disparagement clause of his bid to buy the platform, though there is no indication that Twitter is looking to cancel the sale over this incident.
Edited by Saheli Sen Gupta