the money game

Elon Musk Enters His Rupert Murdoch Phase

Twitter is more powerful than any rocket or car he’ll build. No wonder he wants it so bad.

Photo-Illustration: Intelligencer; Photo: Getty Images
Photo-Illustration: Intelligencer; Photo: Getty Images

This morning, a little more than two weeks after revealing that he’d bought up about a tenth of Twitter, Elon Musk announced to the world through a securities filing that he had lined up three banks to finance his $46 billion takeover of it. Twitter — the social-media company that  relatively few people use — is now ever-more slightly more likely to be owned by the guy who makes cars that very few people drive. But like everything with Musk, the world’s richest man with some $260 billion to his name, the details matter here insofar as they are about building a story about who he is and why he’s doing it. Last week, the Twitter board had put in a so-called poison pill, which blocks any single person from owning too much of a company. Today, Musk said “Fuck it” and leaned into his version of populism by going directly to shareholders in an attempt to get them to pressure the board to accept his offer to buy the company. Will it work? Who knows. But it’s a signal that something bigger is happening here, that Musk won’t stop until he gets his hands on one of Silicon Valley’s most dysfunctional companies — not only giving him control over a primary source of his popularity but one of the most critical pipelines of information into society.

First, the filing. Morgan Stanley, Barclays, and Bank of America are all on Team Musk here, backing him with the financing that isn’t covered by his personal fortune. Musk’s wealth is mostly concentrated in Tesla, which limits how much shareholders can borrow against the stock, so it’s not like he can just sell his shares or get a loan for this. (Remember, Musk has been plagued by the notorious tweet where he lied about having “funding secured” to take Tesla private, which led to settlement with the Securities and Exchange Commission for fraud. He’s since claimed he didn’t lie but has never ponied up convincing exculpatory evidence.) These banks give him the kind of serious Wall Street imprimatur that has eluded him so far in his quest to take over the social-media company.

From here, it’s all about twisting arms. He is still offering $54.20 a share for Twitter, a premium over the $46.71 where it closed yesterday. Now, instead of going to the board of the company — the filing claims that it hasn’t responded to his offer — he’s threatening to push it directly to the people in a bid that shareholder democracy will pave the way. See, the idea here is that everything is negotiable. The board puts in a poison pill? No problem — it ultimately answers to the shareholders, and if enough of them tell the board members to back down, they could just retract it. It gives Musk a convenient enemy in a faceless, nameless group of executives that even Jack Dorsey, the guy who appointed most of them, doesn’t seem to like. This is the narrative that Musk is very good at. He’s the richest populist on the planet, the man who’s gotten rich by giving the people what they want — fast cars that also make people feel like they’re saving the world, rockets that go into outer space, and boob jokes.

Don’t be so credulous. The Twitter deal marks a new phase of Musk’s career: the end of Musk as the innovator who disrupted NASA through SpaceX and the beginning of his Rupert Murdoch era, where he is interested in the transformative power of media to exercise greater influence over society. He got rich running PayPal, but he started his career in the news-and-information business. His first company, Zip2, worked with the New York Times and Hearst to sell city guides back in the 1990s. He made a failed attempt to re-create The Onion by hiring away some of its staffers. And James Murdoch, Rupert’s son and the former CEO of 21st Century Fox, sits on Tesla’s board.

When it comes to Twitter, Musk has always understood social media and is exceptionally good at it. He has built up a cult of personality that has defended him and his company online by buying his company’s shares. His every little emoji is treated like a news event. This is also what makes him the most successful contestant on Silicon Valley’s favorite game show, Who Wants to Buy Twitter? A few of his predecessors, like ex-Disney CEO Bob Iger and Salesforce honcho Marc Benioff, have balked at the company before, either because it was not genteel enough or because it didn’t make financial sense. Musk doesn’t care about either of those things. “This is not a way to make money. Having a public platform that is trusted and broadly inclusive is extremely important to the future of civilization. I don’t care about the economics at all,” Musk said last week.

Comparisons to Murdoch so far have focused on News Corp’s 2005 dud acquisition of MySpace — but the more you look at it, buying Twitter is more like Murdoch’s acquisition of the New York Post. Back in 1976, when Murdoch first bought the tabloid, he transformed the paper from a left-leaning investigative outlet that went after Robert Moses to one where notorious drunken Australian gadfly Steve Dunleavy breathlessly wrote up every crime story during the Summer of Sam. It was a way to control the flow of information in the world’s most important city, changing — over and over again — the bounds of what was acceptable discourse. “I’m not here as some fairy godmother to pour money into the paper,” Murdoch once said in a statement that proved to be laughably false. The Post was a notorious money pit that otherwise secured Murdoch’s influence over the city’s administration and has for decades shaped the national conversation around subjects such as Hunter Biden, Black Lives Matter, and the War on Terror — softened by celebrity gossip and the fun headlines. Amplified by the talking heads a few floors down at Fox News, the Post continues to be a national bellwether for the conservative media.

In that way, the obsessions of people on Twitter have a way of filtering into the broader culture, so that even if you don’t obsessively read Twitter like Musk or the journalism Establishment, you’ll probably end up knowing what is being discussed on it. Musk knows this. Even if the minor kerfuffles that inevitably rise up every day fail to disseminate to the grandmas and grandpas in Peoria, they’re still sticking in the minds of the powerful and influential: the journalists and culture heavies who end up shaping the broader informational landscape. By owning Twitter, it would give him control over one of its most important and reviled features — its ability to moderate content. “I’m worried about de facto bias in ‘the Twitter algorithm’ having a major effect on public discourse,” he tweeted recently. Given that this is more about what’s floating through the right’s perception than the actual reality doesn’t really matter — the point is that Musk’s own un-characterizable political persuasion would likely be a boon for conservative media. (Then again, it might make it harder for every two-bit talk-radio host to claim they’re being “shadowbanned.”) He also offered his own vague opinion about what he would control, saying that “platform’s policies are good if the most extreme 10% on left and right are equally unhappy” — a meaningless statistic that, given his proclivities to amplify people like Joe Rogan, underscores how subjective his position is.

The point, though, is that for as much as Musk evidently loves when people talk about him, acquiring Twitter would give him the ability to control what people talk about when they’re not talking about him too. It’s his way of having broader control: controlling the spigot of information, affecting not only the culture but potentially laws and mores around the world. This is the next iteration of Musk: hard power and deep influence — softened by green cars and dumb jokes.

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Elon Musk Enters His Rupert Murdoch Phase