Interview Synopsis

Twitter – changes coming for approach, platform and focus areas

  • Public Equity
  • TMT
  • North America

Speculation regarding Twitter's future under the potential leadership of Elon Musk continues to intensify with every tweet. In an Interview with Third Bridge Forum, a former client partner lead at the company told us that while they think a “private” Twitter could improve innovation, Musk’s freedom of speech plans might be “disastrous” for business.

Elon Musk’s free speech plans could be “disastrous” for Twitter’s advertising revenue

In the Interview, the specialist told us that taking Twitter private could help the company create, test and launch new features quicker and without public scrutiny – a current “thorn in the side” of Twitter developers. They also said the interest and excitement caused by Musk’s bid could increase monetisable daily active users by 30-40%.

However, the specialist does not “understand” Musk’s plans to change Twitter’s free speech policy. While they said it might increase some “tertiary volume of tweets”, they said these are likely to come from users with “highly polarised views”. This, they added, could “take the common person out of the equation” and make them more reluctant to tweet – further skewing Twitter’s current engagement in which 80% of users account for 15% of tweets.

The specialist said Musk’s free speech plans would also be “disastrous” from a business perspective. An increase in polarised views would likely “curb advertisement interest”, the specialist warned, with advertisers from Fortune 500 companies unlikely to associate themselves with such views. These companies contribute 90% of Twitter’s advertising revenue, the specialist told us, and as such, they believe the risks of Musk’s proposed plans far outweigh the gains.

If Musk completes his acquisition of Twitter, the specialist said it will be “interesting” to monitor if advertisement remains Twitter’s main source of revenue. The specialist believes Musk is “smart enough” to improve new user retention on the platform, but that he faces a delicate “balancing act” to determine how far he wants to stretch free speech within the current economics of the business.  

To access all the human insights in Third Bridge Forum’s Twitter – changes coming for approach, platform & focus areas Interview, click here to view the full transcript.

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The information used in compiling this document has been obtained by Third Bridge from experts participating in Forum Interviews. Third Bridge does not warrant the accuracy of the information and has not independently verified it. It should not be regarded as a trade recommendation or form the basis of any investment decision.

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