Front Burner - Twitter enters the Elon Musk era

Episode Date: April 27, 2022

After two weeks of twists and turns, Elon Musk — CEO of Tesla, richest person on Earth, and a self-proclaimed "free speech absolutist" — has acquired Twitter for $44 billion US. The move has been cheered by some, and raised concerns among others that Musk may remove controls on the platform meant to clamp down on hate speech and harassment. Today, we speak to Kari Paul, a technology reporter for the Guardian US, about what it means for the mercurial billionaire to hold the reins of one of the world's most influential social media sites.

In the Dragon's Den, a simple pitch can lead to a life-changing connection. Watch new episodes of Dragon's Den free on CBC Gem. Brought to you in part by National Angel Capital Organization, empowering Canada's entrepreneurs through angel investment and industry connections. This is a CBC Podcast. Hi, I'm Jamie Poisson. So, Elon, a few hours ago, you made an offer to buy Twitter. Why?

How'd you know? On April 14th, when Elon Musk, CEO of Tesla and the richest person on earth, had this conversation on stage at a TED Talk in Vancouver, a lot of people weren't totally sure if his plans to buy Twitter were actually serious or not. Well, I think it's very important for there to be an inclusive arena for free speech where all, so yeah. After all, this is a guy who has floated the idea of nuking Mars, has promised a high-speed tunnel from New York to DC that never materialized, and on multiple occasions has actually said that he's an alien. I'm like, how does this mother have all this time and all this energy and all these ideas and then people just let him do these things?

Because I'm an alien. I'm pretty sure that he's joking about that last one. But after many twists and turns, on Monday, Musk and Twitter announced he would acquire the social media company for $44 billion. Today on FrontBurner, I'm speaking to Kerry Paul, a technology reporter for The Guardian US, about what it means for the mercurial billionaire to have command over one of the world's most influential social media sites. Hey, Keri, thank you very much for being here. Hi, thank you for having me.

So can we start by talking about how he actually got here? It seems like we were literally just talking on the show about Elon Musk buying a bunch of Twitter stock and then the board opposing him wanting to take over the company and making a plan to block that. And now he's announced a plan to acquire the company for $44 billion. So what happened? What happened here? Yes, it has been a dramatic month. It was revealed earlier in the month that Musk had become the largest single shareholder in Twitter. I think a lot of people were a bit surprised by that. Twitter shares, they are surging right now up a little over 25 percent. This because Tesla CEO

Elon Musk has now taken a passive stake in Twitter. That's according to a new SEC filing. The filing says his stake amounts to 9.2 percent of Twitter's common stock. And then on the 14th of April, so a week or so after that, he declared that he wanted to buy Twitter outright. Twitter on fire this morning over Twitter. If there's one thing Twitter loves, it is itself. It shares that with billionaire Elon Musk, who just bought into the company a few weeks ago and just made a take it or leave it offer for the whole damn thing. All of Twitter. He made an offer and...

He says he wants to pay $54.20 a share to buy up the rest of Twitter that he doesn't have. Of course, $54.20, that's $4.20. That sent the board scrambling. They initially were a bit opposed to that. They enacted an anti-takeover measure known as a poison pill. That just kind of makes it easier for people to buy shares and kind of dilute the number of shares that Elon could buy or make it more difficult for him to buy up all the shares. So that was their initial plan, but then it seems that their reluctance kind of shifted and they found a deal that I guess satisfied everyone. And so that was approved yesterday. After weeks of uncertainty, Elon Musk struck a deal to buy Twitter

at a price of roughly $44 billion. But the question is... With such a huge purchase, I mean, $44 billion, there's a lot of question about where the funding comes from. And Musk, you know, says he has financial backing for the bid. He was able to secure financing, including loans from Canadian banks RBC and CIBC. And a lot of it's coming from his own funds. So the terms of the bid, I guess, became OK for the board to approve.

OK. And he says he's going to take the company private. And practically, what will that mean? So Musk has already promised to take Twitter private. That means he is going to buy all of the shares of the platform. He, you know, offered 5420 per share, which is 38% higher than what the prices are currently, which means, you know, he's kind of investing in its future. And this just means that now those shares will not be publicly traded on the stock market. And, you know, Musk has a storied history with the Securities and Exchange Commission,

the SEC in the U.S. Check out shares of Tesla down around three percent in the after-hours session this following a tweet from ceo elon musk which seemed to troll the sec the tweet said quote just want to say that the short seller enrichment commission is doing incredible work and the name change is so on point this of course after musk made an agreement with the sec to settle fraud charges over the now infamous funding secure tweet about taking the company private the stock is now down around 10 percent and Tesla and its CEO, Elon Musk, accused the U.S. Securities and Exchange Commission of harassing them with what they called an endless and unrelenting investigation, arguing that it is meant to punish Musk for being an outspoken critic of the government. An SEC probe that is looking into Elon Musk and brother Kimball Musk,

that coming after some of their sales of shares, where Elon Musk was asking his Twitter followers how much he should sell, also knowing how much he needed to sell. And having a privately owned company rather than a publicly traded one like his company Tesla will kind of shield him from some of their rules that he has been very upset about in recent years. And so that could be part of the incentive that he wants to take to private. Can you tell me a little bit more about the kind of oversight he would have owning this company privately, like even in internally? With a company going private, that means it will not be under the same public scrutiny. For example, when a company is public, it has to file earnings reports to the SEC,

it has to publicly share information about how the company is doing, it's kind of beholden to its shareholders in terms of how it behaves and what it does, and it has to answer to more people. And so with the company going private, Musk will definitely have more unilateral control over how it's run. And he will have fewer people to answer to in terms of his policies and what he wants to do. And let's talk now about what he says he wants to do. Obviously, we don't know exactly how this will play out, but he has said a few things. I want to get to the free speech stuff in a minute. But first, he says he wants to make the algorithms public.

He talked about this at a recent TED Talk. this at a recent TED Talk. You know, so one of the things that I believe Twitter should do is open source the algorithm and make any changes to people's tweets. You know, if they're emphasized or de-emphasized, that action should be made apparent so anyone can see that that action has been taken. So there's no sort of behind the scenes manipulation, either algorithmically or manually. Could you tell me like what that would or could look like? Yeah, so this has actually been a growing concept in the tech world in recent years, the idea of making algorithms more public.

That's actually kind of a unique call that Elon has done as someone on the tech side. We see a lot of companies kind of avoiding making any information public regarding how their algorithms or how their technology works. There has been legislation recently that would basically require Facebook and other companies, it's been introduced, it hasn't been passed, that would require these companies to open up their algorithms. And that just means kind of allowing outside researchers and outside groups to look at how their algorithms work and how different content is promoted to kind of allow more accountability and more transparency around that. And so like, practically, how might it affect me as like a Twitter, Twitter user? You know, I think it kind me as like a Twitter user?

You know, I think it kind of ties into the idea that some people feel censored or that their voices aren't heard on social media. You know, you hear people kind of shouting these allegations of being shadow banned, which is this concept that your content specifically isn't being promoted in the feed. Tweeted out, it got no life. It got no life. So I'm just wondering, was I shadow banned? The president weighed in saying Twitter shadow banning prominent Republicans, not good. We will look into this discriminatory and illegal practice at once. Many complaints. It's called shadow banning. It's a way to suppress followers and prevent people from finding my page. It only happened to Republicans, though. It didn't happen to my counterpart. So I think under an open algorithm situation like this, more transparency, people would be able to see exactly how their content is promoted.

I don't know how practically that would look in terms of, I don't know, you can't really search am I shadow banned or whatever. But the idea is that you would have kind of like third-party audits of how these companies work so it's not just such a black box where we're all wondering uh why and how we are seeing the content that we see yeah i know uh uh after elon bought twitter ice cube tweeted like like now now you gotta un shadow me. So I guess you would know if he was actually shadow banned or not. He also talks about getting rid of spam bots. He said he was like, you know, gonna, gonna get rid of them or die trying. And also, also like authenticating real humans.

Both of those things sound kind of good to me. But I just could, you just sort of good to me uh but i just could you just sort of explain to me what what that would do yeah so it's interesting musk has talked a lot about spam bots about the anonymous nature of twitter he wants to authenticate all humans it's quite vague he hasn't said what that means um in terms of authenticating all humans i mean currently we have it could be an extension of what we currently have on Twitter, which is a verification system. Oftentimes a user will have a blue check mark by their name. This has been, you know, a point of contention. People have

trouble getting authenticated on Twitter. It's very much a black box. We don't really know exactly how the authentication process works. I mean, I'm verified on Twitter and I don't really understand how it happened. I think it's like quite me too. Yeah. It's quite confusing. Yeah. So yeah, I think, you know, he could just be suggesting an extension of the verification process. We're not really sure what that looks like, or some people have expressed actually concern that he would require you to be verified to be on Twitter and that would eliminate the ability of people to have anonymous accounts. Interesting. Right. Like maybe you were tweeting as a dissident in the country that that, you know, obviously would crack down on people that were criticizing them. Lots of thorny issues. And of course, Twitter makes money by selling ads,

right? And so has Musk talked about the ads? Yeah, so it seems like kind of in the vein of Musk wanting to take the company private and make all these changes. Musk has also said that Twitter should move more towards a subscription model. That would take some of the pressure off of the demand to constantly increase advertising revenue. Twitter has some subscription abilities right now. There was a Twitter Blue premium service that they introduced last year. abilities right now. There was a Twitter Blue premium service that they introduced last year that is just an extra service for $2.99 a month. And you get certain features that allow you to unsend a tweet that you've sent and things like that. Features include the ability to undo a tweet after you've sent it, a reader mode to make it easier to follow long threads on Twitter,

folders to organize saved tweets, plus what the company calls other perks, such as app icons and color themes for the app. Now, Twitter Blue's first iteration... So I think Musk has specifically commented on Twitter Blue, said it should be cheaper, said it should be more widespread. You know, he's got a lot of ideas around subscriptions. I'm sure there are people listening, myself included, who would really love the option to unsend a simple pitch can lead to a life-changing connection. Watch new episodes of Dragon's Den free on CBC Gem. Brought to you in part by National Angel Capital Organization, empowering Canada's entrepreneurs through angel investment and industry connections.

Hi, it's Ramit Sethi here. You may have seen my money show on Netflix. I've been talking about money for 20 years. I've talked to millions of people and I have some startling numbers to share with you. Did you know that of the people I speak to, 50% of them do not know their own household income? That's not a typo, 50%.

That's because money is confusing. In my new book and podcast, Money for Couples, I help you and your partner create a financial vision together. To listen to this podcast, just search for Money for Couples. Okay, let's get to the free speech stuff because this is like the real crux of it here. In a statement on Monday, Musk said, free speech is the bedrock of a functioning democracy.

And Twitter is the digital town square where matters vital to the future of humanity are debated. And so there seems to be an assumption on his part that there is a free speech problem on Twitter that he wants to fix and is a big narrative in conservative media like Fox News. Unlike the leaders of Facebook, Google, Apple, Amazon, Elon Musk believes in free speech. He thinks everyone should be allowed to talk, including people who disagree with him. That means you now have real options for expressing yourself. But before today, you didn't have a right to express your disagreement in public. If you had an opposing opinion or even more dangerous than that, if you had countervailing facts that undermine their storyline, the tech companies would shut

you down immediately. It happened to us. It happened to a lot of people. What is the perceived issue here? So there's this perceived concern, especially amongst conservatives. And I guess it seems Elon Musk shares this concern that these tech companies are disproportionately censoring conservative views, deleting conservative tweets, cracking down on Republicans specifically. And Musk seems to say that there should be an opposite response to that in which, you know, everyone's allowed to just say whatever they want on the internet all the time. This idea that Twitter has a liberal bias, is there any hard evidence of that? There has been some evidence that more Republicans end up being banned on Twitter because of violating terms of services. Tonight, a deafening silence from the president's Twitter account in his waning days as commander in chief. Twitter, run by CEO Jack Dorsey, saying after close review of the president's

recent tweets, it banned him due to the risk of further incitement of violence. Twitter has permanently suspended Marjorie Taylor Greene's personal Twitter account. A Twitter spokesperson says her account was suspended for repeatedly violating the platform's misinformation policy. But, you know, overall, this has been frequently disproven, the idea that, you know, conservatives are singled out for their views or things like that. Twitter releases transparency reports, shows how many accounts they've banned, and it's quite often for misinformation or hate speech. They have a pretty extensive list of community guidelines that when people are suspended, it's because they violate those.

So is it because Twitter is cracking down more on Republicans or is it because Republicans are violating those rules more often? And tell me a little bit more about what Twitter has been doing in recent years. Of course, they have banned people like Donald Trump. It's about the unprecedented assault on free speech we have seen in recent days. These are tense and difficult times. The efforts to censor, cancel and blacklist our fellow citizens are wrong and they are dangerous. our fellow citizens are wrong and they are dangerous.

Alex Jones, I know that they tag some posts from state-affiliated media entities and individual journalists and editors who work with those entities. What other kind of action have they taken and why? Yeah, so like most social media companies, Twitter has been kind of scrambling to fix its rules in recent years. There's been such a big reckoning over how social media impacts public speech, particularly following the 2016 elections, the evidence of Russian interference, ongoing hate speech issues. So we've seen a series of changes from Twitter. For example, in 2021, they enacted new measures to prevent doxing, which is, you know, the practice when you publish someone's personal information, like their address online. They have updated their hateful conduct policy, just kind of tweaking the language so that tweets will be removed if they dehumanize certain groups, call for violence against someone on the basis of religion, age, disability, disease, gender, etc.

So they have tried to narrow down some of these rules and kind of make the language clearer and then enforce them more. They've partnered with a lot of third party companies and nonprofit groups to try to, you know, strengthen their enforcement of these rules. And then obviously a lot of companies are relying on artificial intelligence. So they're kind of working to improve those technologies, too. intelligence. So they're kind of working to improve those technologies too. And so is the concern now that with Musk taking over that some of this work could be undone? I mean, I know everybody is talking about and Twitter employees are asking yesterday if Donald Trump was going to be allowed back on the platform now. Yeah. So a lot of people are very concerned that, I mean, for one, people have not been thinking that Twitter is doing an amazing job of enforcing hate speech. No social media company is perfect in this regard.

And the concern is that now that Musk is going to be at the helm of Twitter, that even the imperfect rules that Twitter has now will now be rolled back. And we're seeing a lot of formerly banned Twitter users, right wing, controversial Twitter users have been very celebratory about Musk. You know, there's a lot of people who have been banned from Twitter who are posting on other platforms being very excited about this. Trump himself, I think, said that he was excited that Elon was taking over Twitter, though he said that he does not plan to return to Twitter, even if he is allowed to. He had 89 million followers on Twitter, almost the most of anybody on Twitter. And on Truth Social, he's only got 1.5 million followers

and almost nobody uses truth social right because he has his new platform right truth yes true social promoting truth what do you think the biggest challenges musk is is likely to run into here in this very messy free speech debate? So I think a lot of the free speech concerns come down to just the idea that an eccentric billionaire can have control over a platform with hundreds of millions of users. This kind of leaves a lot of free speech, quote unquote free speech, at the whims of whatever he thinks is free speech. So a lot of people are very concerned about that. I think the problem is right now that nobody has any idea how he's going to enforce free speech on Twitter. Ironically, the idea

of strengthening free speech protections can sometimes cause the opposite where minorities, people of color, LGBTQ people, other vulnerable groups feel less safe to speak on these platforms. So it really comes down to the concept of free speech and who gets that luxury. You know, the other thing that I wanted to ask you about was that Musk took out a loan against his Tesla shares in order to buy Twitter. What happens if and when his own business interests, could run up against this mission to protect free speech and be this like a global public square. Yeah, right. At the end of the day, there's been a lot of discussion about how tech companies are often incentivized by the bottom line rather than actually the concept of free speech and the greater good for its users and society and the world. And so that has always been an issue.

I think, you know, as long as I can't decide if I'm getting too much on a soapbox, as long as these companies are existing in the framework of surveillance capitalism, where they're making money off of collecting user data and then selling those to advertisers, privacy and free speech are always going to be an issue because the North Star that is guiding all of these companies is not free speech or democracy or any concepts that are good for society. It's literally just their bottom line. And so I guess it's whether Elon know, whether Elon owns this or whether, you know, the companies beholden to shareholders who are wanting to make more money from advertisers, it's all, you know, surveillance capitalism and not necessarily for the greater good. Tell me more about that.

You know, Jack Dorsey, one of the co-founders of Twitter, he seems like jazzed about this acquisition by Musk. He tweeted, Radiohead's everything in its right place. And, and he said, like, it's been owned by Wall Street and the ad model taking it back from Wall Street is the correct first step. But like, I don't know, is it I guess, is it? I think the fact that Elon has said that he wants to move away from advertising and make it more of a subscription model could be a way to take the pressure off of those whims of the market. You're not beholden to shareholders. You're not beholden

to advertisers. It's more like a subscription model. I think that is, you know, fair to say that could help some of these issues. I think, you know, at the end of the day, we shouldn't be relying on a wacky billionaire who could buy a $40 billion company on a whim to make the best decisions regarding content moderation. And I guess, you know, we've talked about this on the show a lot. Like, you know, not only is this one billionaire now owning this highly, highly influential company, but these companies themselves are monopolies. They wield an enormous amount of power and they have found themselves Facebook, YouTube, Twitter in the crosshairs of legislators around the world. Do you think that this acquisition will make legislators more inclined or less inclined to step in here? I think the acquisition will make legislators more inclined to step in. I've definitely seen tweets from different politicians saying, you know, a billionaire shouldn't be able to just

on a whim buy a platform and influence the speech of hundreds of millions of people. I think that is kind of a popular political concept to get behind. I do think there has been so many big tech controversies in recent years. And every time I think like, you know, Cambridge Analytica, the Haugen Papers, January 6th riots, all of these things that every time something new comes out, I think, okay, there's got to be legislation in response to this. This is so horrific. And we have yet to pass any meaningful legislation targeting big tech in the US. So I do think this will help that case. Do I think it will actually cause legislation? I don't know. I've kind of lost hope in that regard, not fully, but I'm never really expecting true legislation and response. Carrie, thank you very much for this. This is really fascinating. Thanks so much for coming by.

Thank you. All right. So just before we go today, after Kerry and I spoke, Elon Musk tweeted about free speech. And I just want to read you what he tweeted. By free speech, I simply mean that which matches the law. I am against censorship that goes far beyond the law. If people want less free speech, they will ask government to pass laws to that effect. Therefore, going beyond the law is contrary to the will of the people. All right, that is all for today. I'm Jamie Poisson. Thanks

so much for listening. Talk to you tomorrow. For more CBC Podcasts, go to cbc.ca slash podcasts.