Commentary
Elon Musk’s attempted takeover of Twitter has generated mountains of news and comment since his 13D filing with the SEC announced his ownership of 9.2 percent of the common stock on April 4th. (Subsequent filings reduced that amount to 9.1 percent)
The partisan boundaries have been clearly drawn, with those on the right applauding the move as a victory for free speech and those on the left bemoaning it as a threat to democracy. The truth, as in most things, lies somewhere in the middle.
But let’s ignore the political aspects of Musk’s move, already thwarted by Twitter adopting a “poison pill” and Vanguard reportedly displacing him as the largest shareholder with 10.3 percent.
Instead, let’s talk about the potential unrealized value of Twitter that someone with the vision and engineering skills of Musk might bring to the platform.
In the 1990s, if you looked at the trading desks of pretty much any brokerage firm, Bloomberg terminals were spread every few desks, but individual brokers and traders’ “home” screens on their desktop PCs were almost universally tuned to the Drudge Report, a news aggregator site that listed the day’s headlines and breaking news. If Drudge flashed a siren on his homepage, it would immediately draw attention, whether it was a natural disaster, a mass shooting, a terror attack, or a national scandal at a company or in Washington. (I learned of the first World Trade Center attack in 1993 within minutes of it happening from a call from my brother who learned of it from Drudge.)
The evening of April 18 and early morning of April 19, 2015, I stayed up more than half the night, transfixed by the moment-to-moment developments in the manhunt for the Tsarnaev Brothers, the naturalized Chechen American émigrés-turned-terrorists who attacked the Boston Marathon. That evening, in its immediacy, Twitter was the source for news and information about the manhunt.
Last week, when a gunman terrorized Brooklyn subway riders, I went to Twitter, having heard only vague reports of an “attack on the subway.” (As my son lives in Brooklyn, I felt the pang of terror every parent has when their child might be in danger. I called, but the call went to voice mail. But Twitter gave details and relief: Brooklyn. Sunset Park. My son would be unlikely to have been on that train.)
I mention all this because there is an insatiable appetite for actionable, breaking news, whether it be for investment purposes, personal safety, competitive intelligence, consumer information, or simple curiosity.
And that brings us back to the enormous value a gifted engineer and visionary like Musk could bring to Twitter.
Imagine being able to apply multiple filters to Twitter to limit your search of the feed. If, for example, I want to know about who was pitching at the New York Yankees home opener, and only from “blue check mark” reporters, I’d be able to set a filter to that. If I wanted to read about the game in a language other than English, I should be able to read those tweets automatically without clicking on “Translate Tweet.” I should be able to see what tweets are the most heavily engaged as well as the ones that are least read. I should be able to hide accounts that aren’t verified as attributable to a human or business owner as opposed to a bot.
It would also be helpful to set tweets from commercial tweeters within a pre-set geographic range that users determine. What’s the special at my neighborhood deli today? What’s playing at the local theater? Is my child’s school closed for snow? Is there a traffic delay? Danger in my neighborhood? An official having a town hall meeting? Lots of these could be made possible by filters and engineering.
Best of all, from a shareholders’ perspective, all these improvements could be monetized on a subscription basis, perhaps for a flat fee with add-ons for a scaled “a la carte” menu. You can have Twitter for free, as it is now, or pay a base fee of $3 per month with upgrades to more premium services for $1 per month for each add on. Ad revenue could be increased, too, because ads could be far better targeted to verified business-to-consumer or business-to-business consumers and to prospective customers.
There will be a lot more to happen and to be written and said about in this battle for the control of Twitter. Almost all of it will be exogenous to the product. If the company focuses its attention on the product, and not who controls it, shareholders and users will win.
