Twitter may go bankrupt, says Elon Musk
Elon Musk, the billionaire who bought Twitter for $44 billion about two weeks ago, sent his first email to all Twitter employees on Wednesday informing them of the social media platform’s grim financial situation. “There is no way to mask the message,” Musk wrote, adding: Frankly, the future economic picture is dire. He went on to detail that the financial situation is worse for a company like Twitter that depends heavily on advertising in a difficult economic climate. “70% of our advertising is brand and not performance specific, which makes us doubly vulnerable,” he stressed. Musk continued, “That’s why the priority over the last ten days has been to develop and roll out Blue Verified Twitter subscriptions,” clarifying: Without significant subscription revenue, there’s a good chance Twitter won’t survive the coming economic downturn. We need about half of our revenue to be subscription. But Musk said the social media company will still be “significantly dependent on advertising,” so he’s working to “make sure Twitter continues to be attractive to advertisers.” The billionaire emphasized: “The road ahead is arduous and will require intense work to succeed.” The CEO of Tesla and Spacex added that Twitter’s policy will change and remote work is no longer allowed. Starting Thursday, all employees at the social media giant must be in the office for at least 40 hours a week, unless they are physically unable to travel or have critical personal commitments. In addition, Musk held an emergency meeting with Twitter employees on Wednesday. He is reported to have said: Bankruptcy is not out of the question. After the meeting, two Twitter executives, Robin Wheeler and Yoel Roth, reportedly left the company. Last week, Musk fired about 50 percent of Twitter’s employees, claiming he had no choice since the social media company was losing more than $4 million a day. Musk admitted Wednesday that his new $8-a-month verification system has problems. “There are too many corrupt ‘verification’ checkmarks. However, he insisted that Twitter usage has increased since he took over the platform. This week, he outlined how Twitter could generate revenue as a payments company after filing documents with the US Financial Crimes Enforcement Network (FinCEN) to launch a payments business. Do you think Twitter will go bankrupt? Let us know in the comments section below. Kevin Helms An Austrian Economics student, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open source systems, network effects, and the intersection between economics and cryptography.
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