Really rich guys buy pro sports teams and media companies. With his purchase of Twitter, Elon Musk is the latest — and wealthiest by far — member of the club.
Making electric cars and spaceships already qualifies him as a swashbuckling, pioneering visionary — arguably the most successful entrepreneur and businessman of our age. But now that he’s a media kingpin, the question is will he be more like Jeff Bezos, who bought the Washington Post a decade ago but mostly leaves it alone, or a guy who’ll use his new toy to make his political views heard?
The evidence so far suggests the latter, like Musk’s bizarre, conspiracy-tinged tweets about the attack on Paul Pelosi, husband of House Speaker Nancy Pelosi.
He has also used Twitter to pursue his political agenda, such as attacks on regulators at the Securities and Exchange Commission, and California bureaucrats for “fascism” after they told Tesla TSLA, +2.50% to shut down a car plant because of Covid-19. Hypocritically, Musk kept his mouth shut when real fascists — the communist government in China — ordered him to do the same.
But Musk has 113 million Twitter followers (up from 80 million a week ago). He didn’t need to spend $44 billion to make his views on anything heard. So what’s his larger agenda?
The Bezos model — generally quiet and low key — obviously isn’t Musk’s style. He’s more William Randolph Hearst, the flamboyant businessman who in the late 19th and early 20th centuries built America’s biggest newspaper chain and media company, Hearst Communications.
If you want a taste of what Hearst was like, watch “Citizen Kane,” ranked as the greatest American film ever made, in which Kane (played by Orson Welles) makes his mark on a rapidly changing America and doesn’t hold back when it comes to sharing his views. One of my favorite scenes is when Mrs. Kane asks:
“Really, Charles, what will people think?”
“What I tell them to think,” Kane replies.
Musk is in a position to do as Hearst, and fellow newspaper baron Joseph Pulitzer did to gin up business, and that was to post lies and disinformation to sell papers.
One reason the Spanish-American War was fought in 1898 was because Hearst and Pulitzer inflamed public opinion with lies. A Hearst employee in Cuba, the artist Frederic Remington, cabled the boss: “There will be no war.” Hearst famously cabled back: “You furnish the pictures, and I’ll furnish the war.” It would be good, he knew, for circulation. That was the revenue model.
This was the birth of what today is known as “yellow journalism.” Musk’s tweets on Pelosi and Russia could foreshadow something similar. Many on the left fear the worst is yet to come.
But how much worse could Twitter be? It has been a cesspool of drivel, division and disinformation for years, a target of vitriol from both left and right.
Musk is no dummy. He understands, I think, that Twitter — one of the world’s most widely followed media brands — is at a crossroads. It can go further into the gutter on his watch, but this would ultimately be dilutive to brand value.
Or he can do as he has done with Tesla and SpaceX, two prestigious, disruptive and transformational companies. They are also both wildly lucrative. Even after plunging 40% this year, Tesla’s market cap is still north of $700 billion, while privately held SpaceX, which does lots of business with the federal government, is estimated to be worth at least $100 billion, based on a recent sale of secondary shares. If you think Musk is wealthy now, taking SpaceX public would send his net worth on a rocket ride.
My prediction — perhaps just a naive hope — is that Musk’s larger priority will be to somehow transform Twitter into something better than it is today. This starts with the problem every other media executive in America wrestles with: How to attract customers and drive revenue, and that begins with offering a better product.
Indeed, Musk signaled Tuesday that he intends to compete for paying customers. He rolled out his “Blue for $8 a month” plan, which he says will allow customers “priority in replies, mentions & search, which is essential to defeat spam/scam.” It will also allow for the posting of “long video and audio” and reduce the number of ads people are exposed to by half.
It’s not much different than the $8.99 that Amazon Music charges each month for ad-free listening, or the $9.99 Comcast’s Peacock charges for ad-free viewing of movies and TV shows. There’s no price to be paid for using Twitter now; perhaps charging money will drive out the riff-raff.
Then there is this: There is opportunity for Musk to scale up with Twitter. Instead of partnering with newspapers, which it does now, what if privately held Twitter just bought them?
No one thought the legendary Graham family would ever sell the Washington Post until Bezos came along with a fat offer. Similarly, it seems unthinkable that the Sulzberger family, which has owned the New York Times for five generations, will ever sell.
But the Times — arguably the most respected news brand on the planet — is only worth $4.5 billion. Musk could easily pay a multiple of this without breaking a sweat. And who’s to say that CNN, which has been rumored to be in play for years, couldn’t be sold if the price was right?
Musk and Warner Bros. Discovery CEO David Zaslav are said to have a cordial relationship. Amazon has “Thursday Night Football”; Musk could easily muscle into live sports, one of the few types of content that continues to attract premium pricing. The World Cup, which begins later this month, cost Fox Sports and NBCUniversal’s Telemundo, around $1 billion for both the 2018 and 2022 rights.
All of this is lunch money for Musk, who understands that everything is always for sale, depending on the price. World Cup 2026 on Twitter? There are crazier ideas, you know.
Of television, Edward R. Murrow, regarded as the best broadcast journalist who ever lived, said it “can teach, it can illuminate; yes, and even it can inspire. But it can do so only to the extent that humans are determined to use it to those ends. Otherwise, it’s nothing but wires and lights in a box. There is a great and perhaps decisive battle to be fought against ignorance, intolerance and indifference. This weapon of television could be useful.”
He could be talking about Twitter — and social media in general — today. Musk must decide which course he’ll take.