Hello! Welcome (or welcome back) to This Week in Elon, The edge‘s occasionally revived newsletter for when there’s Too Much Elon News. And, I mean, there’s always too much Elon news. But what’s happening now feels worth delving deeper into. So let’s get into it.
On Tuesday, Musk demanded that Tesla employees come back to the office or “pretend to work elsewhere,” which is odd for someone who divides his time between cities and at least four different companies. He also wants to cut about 10 percent of Tesla’s workforce. Reuters reported this morning, based on his “super bad feeling” about the economy, and all I’m saying is: I don’t want to take layoffs so I’m going to make you so unhappy to quit wouldn’t be a particularly off-brand management tactic for Musk.
“Good luck on his journey to the moon,” President Joe Biden said when asked about Musk’s thinking. Musk’s response: “Thank you Mr President† And, uh, thanks for paying for it!
Meanwhile, Musk tweeted last night that he is moving Tesla’s AI day to September 30 because he hopes to have a working prototype of the Optimus robot by then. (And by ‘work’ I assume he doesn’t mean in the sense of ‘it’s a person dancing in a suit’.)
But the real story in the Musk universe, and the real reason we’re back in action here at This Week in Elon, is Twitter. That story pretty much begins on April 4 of this year, when your friendly neighborhood oligarch bought 9.2 percent of Twitter’s stock. At first Musk was just an investor, then he was going to join the company’s board of directors, but then he decided against it because he apparently decided he wanted to buy Twitter instead. The board of Twitter was initially uninterested and put in a poison pill, then thought the best of it all and decided, yes, of course, let’s sell – something, something that has a fiduciary responsibility to shareholders.
So now Musk is on the hook for Twitter at $54.20 a share, meaning he should be pocketing about $44 billion. That’s not easy, even if you have about all the money in the known universe! He sold $8.4 billion of his Tesla stock to fund the thing, and he persuaded Larry Ellison and some of his other wealthy friends to raise their own billions to help. Then Musk got cold feet and declared the deal “temporarily on hold”, which is not real, all the while spending a lot of time complaining about spam bots on the platform. (In defense, there to be many people with six followers giving away “millions in crypto” in his answers.)
So, where does this leave the deal now? Swirling in chaos and further on about where it was eight weeks ago. Twitter keeps reminding Musk that, like, they signed a contract with lawyers and stuff, and it plans to force Musk to honor the deal. As of this morning, the so-called Hart-Scott-Rodino waiting period has been eliminated, which is a procedural matter with a bad reputation, which basically means that government antitrust regulators have no intention of taking action against the deal.
Meanwhile, that deal seems a little more expensive every day: Tesla shares have fallen nearly 40 percent since April 4, and Twitter’s competitors like Meta and Snapchat have also fallen between 15 and 65 percent since then. I bet over $44 billion that Musk would offer much less than $54.20 a share for the company if he could start the process over. But hey, richest man in the world, he’ll be fine. To quell some of the Tesla panic, he even pledged to put in another $6 billion of his own money instead of borrowing it against his stock, which investors liked.
This is all… a lot. But assuming the deal goes through – which again seems like the most likely outcome – the most interesting question in the coming months is what does an Elon Twitter property look like? We’ve written a lot about that on The edge, from Musk’s deafening silence after the live-streamed Buffalo shooting to his many, mostly nonsensical, thoughts on open sourcing algorithms and free speech. So far, Musk has stuck to his answers under the law for how to think about content moderation, but if The edge‘s editor-in-chief Nilay Patel likes to say, that is a baby idea for babies† This stuff gets real, and complicated, fast.
Or maybe not? It is becoming less and less clear that there will still be a lot of Twitter left for Musk to own. Musk has spent a lot of time in recent weeks publicly destroying the team he’s supposedly taking over, both for their work and their policies, and has talked about how bloated the company is. CEO Parag Agrawal fired a few top Twitter leaders, Jack Dorsey left the board and anything that smells like a long-term bet is being shut down. The employees that remain just seem… tired? Jay Sullivan, the company’s recently promoted product head, called out the “chaos tax” of the Musk acquisition, which is as good an explanation for the overall Musk effect as I’ve ever heard.
And while the financial details of Musk’s Twitter takeover may not change, the world around them is. The economic situation looks bleak for the foreseeable future, regulators around the world – but especially in the EU – continue to push questions of content moderation, the Supreme Court suddenly seems about to have opinions on social media, Russia and Ukraine are at war, are we getting closer to a new presidential election season, and I don’t know, is the metaverse something? Uncertainty is everywhere right now.
Musk also has his share of personal chaos, although I’m reluctant to ever call anything “potential problems for Elon Musk” because those don’t seem to really exist. Yet there is that Insider story from a few weeks ago that SpaceX allegedly paid $250,000 to settle a sexual harassment allegation against a flight attendant on its plane; the story alleged, among other things, that Musk offered to buy her a horse in exchange for sexual favors. Musk continues to loudly and repeatedly deny the allegations, saying things about hiring a “hardcore process department‘, and promises that ‘there will be blood’. You have to wonder if he watched the circus of the Depp-Heard libel trial and started making a list in his head of the victims of libel cases.
The SEC is also investigating the way Musk filed investment papers prior to the offer on Twitter, but you know what, let alone the SEC will fine him $60 and we’ll all move on.
Okay, I think we’re about catching up. Over the next few months, we’re going to look at all the goings on in Musk Land, all the ways Elon Elons, and most importantly, what it means for the richest person in the world to own one of our most important social networks. There’s absolutely no denying that Musk is good at Twitter — honestly, is anyone? better on Twitter? – but will he be good? in front of Twitter? And what does that actually look like?
(By the way, we need your help with all this. If you read anything interesting about Elon, have a question, see a file, or just roll your eyes at his latest shit post, tell us! Send an email to email@example.com and you can reach the entire crew behind this newsletter. We’d love to hear what you’re thinking.)
We only have one rule here at This Week in Elon, and it’s this: Always assume the most ridiculous thing is going to happen, because this is Elon Musk we’re talking about, and the most ridiculous thing almost always happens. So we’ll be back here in a week when a bunch of Optimus robots use Twitter and just absolutely crush it. Speak to you then.