Angelo Carusone speaks to Alicia Menendez about Elon Musk pulling out of Twitter deal: “Twitter's board should have certainly been better about this”
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From the July 10, 2022, edition of MSNBC's American Voices with Alicia Menendez
ALICIA MENENDEZ (HOST): Drama between Twitter and Elon Musk taking off and Trump world up in arms over the billionaires filing to pull out of the $44 billion deal to buy the social media giant. In the filing, Musk said he believed Twitter was in material breach of multiple provisions of the April 25th sale agreement, including Musk's request that the company share information about the number of fake and spam accounts on the social media platform. Twitter, determined to hold Musk to the agreement, setting the stage for an epic court battle. Most legal experts say they believe Twitter has the upper hand given the fine print of the sale agreement. Regardless, Trumpworld not happy. Keep in mind, Musk said he would allow the former president, twice impeached, back on the platform. So little shock that just a day after the news broke, Trump hit the trail for Sarah Palin in Alaska, calling Musk, quote, another B.S. artist.
Joining me now, president of Media Matters, Angelo Carusone. Angelo, there were concerns about Elon Musk pushing his political ideals on Twitter. Can you explain how that could have been a dangerous step backwards in the fight against disinformation, in the fight against extremism.
ANGELO CARUSONE (MEDIA MATTERS PRESIDENT AND CEO): Big time and three ways.
One is that if he rolled back a bunch of the policies that Twitter had put in place – just bare minimum stuff saying, you can't push certain kinds of disinformation, there are prohibitions on manipulated media and coordinated attacks, all sorts of disinfo stuff. That alone would be a problem. So that's number one.
But the bigger thing was that he could have had a real risk of tinkering with the algorithm, which is the recommendation engines and everything, to align with something that he's previously said before, which is that it's really important and essential to red pill as many people as you possibly can, which is the process by which you radicalize individuals to become further to the right.
And the third is that Twitter has actually been helpful in improving the overall landscape because of their size, they're smaller, but their audience and their users are really influential. They've actually tended to be a little bit of a vanguard when it comes to putting in place new proactive protections against disinformation. So there's no chance Elon Musk would have done that.
So the harms were real and significant. And that's in part why so many Trump people were celebrating when he said he was going to take it over.
MENENDEZ: Angelo, I want to give credit where credit is due, which is you and I months ago sat here and we talked about this potential deal and you were very suspicious about the possibility of it going through. So clearly, your instincts at the time strong your sense of why this was sort of doomed from the beginning.
CARUSONE: The big picture was that it seemed like Musk had a plan, his original financing deal, the one that Twitter accepted. And so if my instincts and my gut were off, Twitter's board should have certainly been better about this.
But his original financing deal was a house of cards. It wasn't a real offer, and it was very clear, based on his behavior, that he was trying to generate a bunch of buzz and excitement to then go back to the table and secure a better financing deal that didn't require him to rely on 40% of his Tesla stock as collateral. So right from the very beginning, he was suspicious, and then his behavior sort of played into that pattern. He was trying to brute force it, hype it up, get a bunch of interest, go back and get a better financing deal. And that to me suggested that it wasn't going to be able to be sustainable because there were a lot of pitfalls and traps that he was stepping on in the initial couple of weeks.
MENENDEZ: Angelo, as you outline, listen, he was pretty open about his agenda, the changes he planned to make to the platform. How then did all of that hurt him with advertisers?
CARUSONE: That I think is the one part of this story in the last couple of days that hasn't really been explored. What happened is he got out there so early and he got so much positive feedback from Trump supporters and the far-right, from users that had been banned on Twitter, all getting excited that they were going to come back online.
But his timing was a little bit off. See, he did a whole bunch of that hype right at a time when Twitter has this event called the upfronts, which is when they sell about 20 to 25% of all of their ad revenue for next year. So they lock in a bunch of contracts and revenue. When he was doing that, Twitter didn't really have any answers to the advertisers about what's going to happen if Elon Musk takes it over and then takes off all these brand safety things. So a two-hour sales event that – was only lasted about 20 minutes. They didn't have any answers and as far as I know, didn't really make any big deals. They usually sell about $900 million of ads at that event. They didn't really sell anything even close to that. So that in turn sort of demonstrated that whatever Musk was doing was certainly going to cut away – undercut a whole significant bunch of Twitter's revenue, which Musk actually needed in order to service the debt on the financing plan that he put together in the first place.
MENENDEZ: All right. I'm sure we're going to be talking to you much more, Angelo, as this story continues to develop. Thank you so much for taking the time to be with us.