Monday, December 5

Mass layoffs, advertiser flight and drop in income after the purchase of Twitter by Elon Musk

It’s been a week since the world’s richest man, Elon Musk, bought Twitter for $44 billion. This Friday Musk has fired thousands of workers from the social network staff in the United States, Europe and Asia and, although he has said that his ultimate goal is for the platform to “help humanity”, he has not yet made it clear what his future will be like. business strategy.

Musk has justified the layoffs – he has not yet specified the total number, although the press puts them at more than 3,700 – pointing out that the social network loses four million dollars a day. “There is no other choice,” said the tycoon in a tweet.

On Friday morning, Musk explained that the company had seen a drastic drop in revenue, which he blamed on a stampede by advertisers due to “activist groups” allegedly pressuring companies to withdraw advertising.

Among them, the automotive giants Volkswagen and General Motors have announced that they will stop advertising on the platform, although the latter is waiting to see “the direction” that the social network takes.

In addition, other large advertising companies have recommended that their clients temporarily suspend their advertising on Twitter due to concerns about the company’s ability to monitor their content, The Wall Street Journal has reported.

Ads account for nearly 90% of the social network’s revenue.

Among the users of the network there are different opinions. Though after Musk took over ownership of Twitter, personalities like “Grey’s Anatomy” producer Shonda Rhimes, singer Sara Bareilles, actress Tea Leoni and singer Toni Braxton have left the app. However, a big boycott has not yet been seen on the network.

The writer Stephen King, with a legion of followers on Twitter (6.9 million) wrote this Friday on the network that Elon Musk’s behavior with Twitter is like that of Tom Sawyer in the famous fence painting scene.

“Musk reminds me of Tom Sawyer, who is given the job of painting a fence as punishment, and Tom convinces his friends to do the job for him, making them pay him for the privilege. That’s what Musk wants to do with Twitter. No no no,” he wrote.

Complaints for unfair dismissal

As for the dismissed employees, who received an email with the termination of their contract in their mail -because the offices remained closed by order of the owner-, Musk assured that all of them have had an offer of three months of compensation, “which is 50% more than legally required.

Despite this offer, some have already sued the company for unfair dismissal, because according to current labor laws in San Francisco (where Twitter’s headquarters are located), an employee must receive at least 60 days’ notice, which which has not been fulfilled in this case.

“The Future of Civilization”

In recent days, the also CEO of Tesla and founder of SpaceX has used the social network itself to outline some possible ideas, such as a “premium” subscription for $8 or the revival of the Vine video service.

Musk announced on the day of the purchase – which took place 24 hours before the expiration of the term that a judge had given him to open a process if the transition for 44,000 million dollars was not formalized – that the reason why he acquired Twitter was guarantee for “the future of civilization” that there is “a common digital public square, where a wide range of beliefs can be debated in a healthy way, without resorting to violence”.

In addition, he said that Twitter “cannot become a hell free for all, where anything can be said without consequences”, but must “respect the laws”.

other changes

Although his strategy is not yet clear, what Musk has announced are some changes in the use of the network, such as the creation of a “premium subscription” for 8 dollars with benefits such as obtaining the verification mark, less advertising or the option to tweet longer videos.

On October 30, the tycoon asked his more than 113 million followers if he should restore Vine -a short video platform that Twitter bought in 2012 and closed in 2016-, and obtained the support of 69.6% of voters.

According to The Washington Post, which had access to internal company emails, Twitter is working on a feature that would allow users to post videos and charge users to watch them.

This Friday, Musk marked a week as the official owner of Twitter, in which the billionaire has released endless trial balloons about his plans for the company. All of them explained unofficially in a few tweets or with leaks, which has managed to keep him at the center of the debate.