This comes after billionaire Elon Musk on Thursday
offered to buy 100% of Twitter in an updated 13D filing with the SEC wherein he is offering $54.20 per share in cash to buy the San Francisco headquartered micro blogging site for $41.39 billion.
Musk has proposed to make Twitter a private entity if the proposal goes through. Twitter rival Koo App co-founder Aprameya Radhakrishna said this was a sensible move as it would help Musk to execute ‘drastic changes.’
“Going private means being able to make rapid and impactful changes in an organisation,” he told ET. “You don’t want to be under market scrutiny if you want to make drastic changes. Doing it as a private company makes more sense.”
He added that self expression is a ‘public good’ and that any company that enables public expression has to be unbiased, transparent and consistent which has been a question at Twitter for a long time. “For Elon Musk to be interested in buying out Twitter, it shows that there’s quite a bit to do in terms of fixing freedom of expression in the English world. Koo will continue to go on its path of making freedom of expression for non-English folks democratised. The other opportunity is to create a more meaningful and decentralised platform,” said Radhakrishna.
Lawyers that ET spoke to said that it would be tough for Twitter to justify a refusal of Musk’s “generous offer” of $54.20 per share which is a 38% premium over the day before his investment in the company was publicly announced. Further, they added that Twitter could be at the receiving end of criticism for its response to the offer considering that Musk enjoys a very loyal following which also comes across in the fact that he has 81 million followers on the platform.
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“If Musk manages to see this deal through, it may mean a new era of free speech for users of Twitter, and we would see a social media company under the control of a technological genius that may rival Meta in consumer base,” Siddharth Mody, Partner at law firm Desai & Diwanji said. “His belief system and vocal support of democracy for society would mean that this acquisition might result in a change in Twitter’s company policies and an upward surge in Twitter’s share price as well.”
A major concern however that those in the industry flagged was surrounding Musk’s statement in the filing wherein he said he had “no confidence in the management” which puts a question mark over the future of Twitter CEO Parag Agrawal and other senior leadership in the company.
“The Twitter Board of Directors will carefully review the proposal to determine the course of action that it believes is in the best interest of the Company and all Twitter stockholders,” Twitter said in a statement on Thursday.
Experts also said that if Musk’s proposal goes through, it would mean that Twitter would move towards becoming a paid platform, which in turn will affect every other platform.
“Pay for use of the platform has been a long standing question for Twitter,” a senior social media executive who did not wish to be named told ET. “If Musk acquires Twitter and puts this in place, it will have far reaching effects on all platforms. The ad mechanism is broken and the recurring revenues method is a much better mechanism but this will put pressure on players of all sizes be it Instagram or even niche platforms Pinterest, Tumblr and Indian players like ShareChat.”
“Twitter has been behaving like a legacy company with hardly any innovation and nothing has really worked in terms of their new products while revenue has struggled to catch up,” a founder of an early stage VC fund told ET on the condition of anonymity.
He went on to add that other big platforms like Meta should treat this as a wake up call and a signal that they will not be far behind and could face such situations going forward.
