Musk meets Twitter staff, says 'Freedom of reach,' targeting 1B users are critical (updated)

Jun. 16, 2022 1:21 PM ETTwitter, Inc. (TWTR)TCEHY, TSLA, BDNCEBy: Jason Aycock, SA News Editor219 Comments

Elon Musk Visits Germany

Maja Hitij/Getty Images News

Billionaire and presumptive Twitter (NYSE:TWTR) buyer Elon Musk used a highly anticipated meeting on Thursday to face employee questions - and Musk wasted no time in saying the media isn't representing his $44B buyout deal accurately.

Most articles he sees about the deal are negative, Musk said, according to Bloomberg.

“Some people use their hair to express themselves. I use Twitter,” Musk told the employees in addressing an opening question about why he pursued the company, according to the report.

Taking on the topic of free speech and moderation, Musk reportedly said that users should be allowed to say "pretty outrageous things" so long as they're legal.

"There's freedom of speech or freedom of reach," Musk said, noting just because someone could legally "walk into the middle of Times Square and deny the Holocaust" doesn't mean that needs to be promoted to millions of people. "So I think people should be allowed to say pretty outrageous things that are within the bounds of the law, but then that doesn’t get amplified, it doesn’t get, you know, a ton of reach."

And for those looking for a potential Musk vision for Twitter (TWTR), Musk had praise for WeChat, owned by China's Tencent Holdings (OTCPK:TCEHY). Users there are so dedicated that “You basically live on WeChat,” Musk said, according to a New York Times report.

Musk also praised China's TikTok (BDNCE), saying that Twitter needs to not show "boring" content, and TikTok does a great job of keeping people entertained, according to NYT.

Moving to the key topic of the day - Musk's putting the deal "temporarily on hold" as he pressed for information about fake and bot accounts - Musk reiterated that any algorithm Twitter uses to moderate or control spam should have its code open-sourced, Bloomberg reported.

Musk said that Twitter (TWTR) might try having users pay to be verified as human or real, and potentially use a tool like Twitter's (TWTR) existing Twitter Blue subscription. Verification could also be used to rank content on the platform, he said, according to Bloomberg.

Later in the meeting, the NYT noted Musk seemed to have backed off a previous idea requiring real names, suggesting there's utility in using pseudonyms to express political views on Twitter (TWTR).

Musk also outlined a goal to grow the company's user base to 1B active users.

One flaw that Musk said that is affecting Twitter (TWTR) is that he said it is not the platform of choice for those preferring to create video, and other platforms are monetizing content in a way that Twitter (TWTR) can't, Bloomberg reported.

Musk also took questions about employees working from home--which were particularly timely in light of his directives to Tesla (TSLA) and SpaceX employees to spend 40 hours a week in the office. Musk reportedly said "excellent" contributors could still be productive remotely.

Potential layoffs were a key employee question. Musk said Twitter's (TWTR) revenue needs to be higher than its costs, and that layoffs will be conducted based on performance reviews, Bloomberg said.

"The company needs to get healthy," Musk said.

Updated 1 p.m.: As the meeting ended, Musk agreed to speak to Twitter (TWTR) employees again. Among his last topics, Musk was asked about whether he would be CEO at the company, and he said he's not hung up on that title, according to Bloomberg. There are a lot of chores for the CEO, and he seems concerned with the ability to "drive the product in a particular direction." Whatever his title is, he says people need to listen to him regarding the company's product.

Musk was set to handle previously submitted questions for about an hour in a session moderated by Twitter's Chief Marketing Officer and Head of People Leslie Berland, according to media reports. But, he elected to go over time to keep addressing more questions.

What had been slow traffic on an employee channel designed to gather questions turned into an overnight flood of queries, Bloomberg reported.

The spread between Twitter's current price and Musk's committed deal price still looks like a gulf: Twitter stock (TWTR) is at $38.06 a share, while Musk has committed to buy at $54.20 a share - a hefty 42% premium to the current price.

Check out Seeking Alpha's previous coverage of Elon Musk and Twitter.

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