Evelyn Douek:

This will be my third Moderated Content that goes out this week, which is an immoderate amount of content in my opinion. But anyway.

Alex Stamos:

It’s the benefit you get of not teaching this course.

Evelyn Douek:

That’s true. Enjoy the Australian accent. Gorgeous.

Hello and welcome to Moderated Content’s first emergency edition with myself, Evelyn Douek, and Stanford internet Observatory’s Alex Stamos, two people who really can’t be expected to sit out this Elon Musk hot news take cycle.

All right. So Alex, what’s your top line takeaway or view here?

Alex Stamos:

My top line takeaway is Elon Musk has bought himself into a hellish existence. He has made an incredibly bad decision by making himself personally responsible for moderation of Twitter in a way that no human being has been responsible publicly, at least for content moderation on any major platform. And he has made a serious kind of business CEO level mistake that is putting most of his net worth, which is invested in Tesla and all the other Tesla shareholders, in jeopardy.

Evelyn Douek:

I think my headline takeaway is that no man, not even Elon Musk, is above the law and the regulatory landscape in many countries is changing rapidly and is vastly different to what it was when these companies were born.

So this idea that these platforms can return to the golden days of their youth is a fiction because Musk is going to run headlong into regulations or changed legal conditions potentially in the United States, depending on what happens with all these Supreme Court cases and Congress, but also definitely in India, in the EU, and a whole number of other countries that we’ll talk about. I think that global exposure piece is really important.

All right. So where do you want to start?

Alex Stamos:

Well, maybe we talk domestic first and then go international?

Evelyn Douek:

Okay. So everyone’s talking about the midterms. Maybe we’ll start there. What do you think might happen, impact on the midterms of this?

Alex Stamos:

So with incredible timing, our group at the Election Integrity Partnership published our analysis of platform policies around election integrity yesterday. So it was great just minutes before the deal closed, so that was awesome. I’m glad all of that work those RAs put into that lasted at least 90 seconds.

But in all seriousness, there’s been a significant improvement in the election disinformation policies of the major platforms. You can go to eipartnership.net and click on the blog button and it is the top blog post if you’re interested in seeing our analysis.

I’m not going to read out this huge post that has a lot of complexity that, again, folks from both Stanford and the University of Washington I think did a really good job on. But if you look at it, you’ll see that there’s pretty comprehensive policies including from Twitter.

That is a big contrast to at this point in 2020 and certainly in 2018 or 2016. So I would generally consider that a good thing. How many of those policies make it to the actual midterm is a great question now. I think probably most of them do, right?

Evelyn Douek:

Right.

Alex Stamos:

I think my prediction here is Zuck, or sorry Elon, we now have two one-named famous billionaires who are running social media companies.

Evelyn Douek:

It’s so hard to keep track of all these white boys. It’s understandable that you get them confused.

Alex Stamos:

So Elon came in, fired some key executives, made some big signaling, but it does not seem that he’s made any real low level changes yet. I have spoken to a number of people at Twitter and no actual functional changes so far have happened.

So I think there is a question of how long any significant changes to kind of the day-to-day operations and policy interpretations of Twitter will take. So between now and the midterms, will there be a significant change? Probably not. Probably the biggest question is does Donald Trump come back to Twitter before the midterms? And what way that cuts is actually an interesting question.

Evelyn Douek:

Can I just ask two follow-ups maybe about the election rules? So the first one is about will it change overnight? You’re seeing all of this, “The sky is falling, the sky is falling” on Twitter right now. And there’s been some reporting out from The Washington Post about how people are unleashing racist torrents and it’s sort of gotten out of hand overnight. I’m curious for your thoughts on that.

Alex Stamos:

So Twitter’s operational enforcement does not seem to have changed much yet. But the input, what is going into the top of the trusted safety funnel of content that is probably violative of their current policies, has massively increased it looks like. Elon taking over has been celebrated on a number of alternative platforms on the 4chans and the 8chans. Parlor and Gab were actually working on writing up the response to Elon. And there seems to be kind of a coordinated attempt to feel out the new rules. Again, I don’t think the rules have actually changed, but if you search right now for any racial epithet, you see a significant number of tweets where people are just using the N-word example over and over and over again in a thread because they believe that now they’re going to get away with it.

Whether or not they’re going to is a question. And a number of those, people have screenshotted them. I’ve looked and they’re actually gone. The accounts have either been taken down or the tweets themselves have been taken down.

So there is probably pretty strong evidence that they’re enforcing. But since the amount that’s coming in the top of the funnel has increased significantly of especially it looks like racial hate speech, then what gets through, if you’re catching 99.9%, if you do 10 times as much stuff coming in, then you’ll have 10 times as much prevalence afterwards continuously.

Evelyn Douek:

Right. It just sort of highlights the reason why all these transparency reports from platforms can be largely useless because you never know what the variables are. So Facebook shows a 10 times increase in taking down hate speech, everyone goes, “Yay, Facebook’s doing so much better.” But it could just be because there is a 10 times increase of hate speech on the platform.

Alex Stamos:

Yeah. It’s what we call an attacker control metric in the industry. That’s why the real important metric here is result in prevalence of how much stuff is actually seen of violative content that then times the number of views of it, and that number has definitely gone up. We’re going to try to come up with some estimates here at SIO before and after, but certainly there have been some changes there.

Evelyn Douek:

Great. So that’s an excellent transition to my second question, which is one of the fears here is that Twitter has really led the industry in terms of data transparency to researchers and opening up its platform so that we can tell what’s going on. And you at SIO have relied and done a lot of really important work based on that. How worried are you about that going away?

Alex Stamos:

I’m extremely worried. And I’m worried about what happens at Twitter, but I’m especially worried about the long-term impact that has on the entire industry. Like you said, Twitter was a very early leader here of having an API that allowed for researcher access. For Twitter, it was easier than some of the other platforms because Twitter is almost completely a public platform; 99% of the content is posted to everybody. So for them to allow API access did not have the same kind of Cambridge Analytica issues that you would have with a Facebook.

That being said, Twitter went out there and, to give them credit, opened up an API, worked with researchers. Our group has a researcher agreement with Twitter in which we’re allowed to have free access to an API that they otherwise sell. In return, we have to follow some privacy rules and stuff. But those rules are completely neutral and they have no restrictions on what we say about Twitter. I have a real fear that both the contracts go away and then eventually the APIs go away. And partially, that would be a logical thing for Twitter if they’re only thinking about themselves or Elon’s only thinking about himself because, as a number of people have pointed out over the years, Twitter gets a disproportionate amount of criticism because it is one of the only platforms that is available for any kind of research.

The other platform that’s second here is Facebook. And then after Twitter and Facebook, it’s a very steep drop-off where your favorite platform, YouTube, for example, just published an API for which I have not heard of anybody being approved for yet and the API as I last saw it was not very useful. And so TikTok has no transparency at all. So there’s a bunch of companies that do nothing. You have Twitter and Facebook being out there. If Twitter drops their lead and it’s Facebook by themselves, and if you’re Mark Zuckerberg, he’s been looking to kill CrowdTangle clearly for a while. CrowdTangle is the mechanism by which you could study stuff going on on Facebook both in the media and in academia. If you’re Mark Zuckerberg, you absolutely use the cover of Elon to drop CrowdTangle.

So I am afraid of us losing access to Twitter, which is important in the United States. And then I’m especially afraid that this is going to open a door for Facebook to drop transparency, which becomes a big deal around the world.

Evelyn Douek:

And this is almost certainly not the only way in which Facebook is going to take cover from Twitter as we go forward.

Alex Stamos:

Yeah. Mark Zuckerberg’s got to be one of the happiest people in the world right now in that every criticism that he has taken, Elon’s now taken, which I think if we want to pivot to the international side, Mark Zuckerberg hated … Sorry, go ahead.

Evelyn Douek:

No, I was just … Before we do, I think that you raised the Trump question and I think it would be good to … I guess we have to answer that because I think this is an area where Facebook may take cover from Twitter as well.

Alex Stamos:

Right.

Evelyn Douek:

My prediction is that Trump is back. I’m kind of surprised that he’s not back on Twitter already, but he might be by the time this episode is posted. It would seem to be the most visible way that Elon could signal that there’s a new sheriff in town.

Of course, there’s the hypothesis that he will no longer enjoy being the main character of Twitter, and that that sort of might be a bit of a dilemma for him. But that’s my prediction.

What do you think and what effects might that have if he is back?

Alex Stamos:

So there’s a bunch of interesting questions about Trump. One is Trump is on Truth Social, which is a platform that he advertised that would be his own platform. And I believe that advertisement was part of selling shares in a SPAC, a special purpose acquisition company to raise money for Truth Social and therefore for Donald Trump himself.

So you’re not a securities lawyer, but I think it is quite possible in the future we’ll be having discussion about whether or not Trump coming back to Twitter actually becomes a securities law issue because people who invested in Truth Social did so with the idea that Donald Trump was going to bring all of these fans over onto that platform.

So, one, that’s an interesting question of whether Trump can really come back without himself violating securities law. And then second is, if he comes back, I think Musk has created this problem where the assumption from Trump is not only is he back but he is back in a way that he is completely free of any restrictions. That in a world in which Parag and Twitter made a decision of Donald Trump is a newsworthy figure, perhaps he declares a candidacy and we’re going to have a rule that if you’re a candidate in a major election, you’re allowed on the platform, there’s no way they would say, “But you could say anything you want.” They would say, “You have to come back within these guidelines.” And then we would have a couple of weeks of Trump testing those edges and then Fox News running three hours every time a Trump tweet was taken down. But eventually, Trump would find the edges of that.

His assumption if he comes back is he’s got no edges, that he could do whatever the heck he wants. And so the stuff he has posted on Truth Social since he’s been de-platformed from Twitter is insane. It’s just completely total … If you thought he was bad on Twitter before, it is going to be a total mess. And again, Elon’s advertising of this, of he is personally responsible now for everything Donald Trump says on Twitter, is a totally crazy place to put himself from a global perspective. And so I think, yes, I think Trump will come back and I think the fascinating question will be will Elon create any kind of guide rails for Trump, will he publicly or privately communicate those and will we see some kind of back and forth where Trump actually is moderated? Or perhaps there’s a private phone call here of, “Hey, Don, you got to take this tweet down.” Because Elon’s not going to want to do any kind of public moderation. Anyway, it’s going to be fascinating to see what happens.

Evelyn Douek:

Even Donald Trump disclaims responsibility for the things that Donald Trump says. So good luck, Elon, taking that on your shoulders. Yeah. I think there’s been reporting about Elon saying that he’s going to get rid of permanent bans on Twitter and I actually am not convinced that that’s a bad idea.

I think that there are many cases in which permanent bans can be a disproportionate response, and that was one of the things that the oversight board said in its decision about Donald Trump. But it’s exactly this thing about, well, if someone’s been permanently banned, maybe they’ll show remorse and reform their behavior but that seems really unlikely in this particular case. So doing it without any guard rails is pretty irresponsible.

Alex Stamos:

Right. I mean everything that Musk has said up to this point I think we now have to throw away. Because the truth is it’s clear that he has made all these statements that are completely opposite of each other. “I’m going to have no moderation, but I’m going to fix the bots. Oh, you know what we should do is we should enforce the law. Oh, and if people are really bad, we should kick them off.”

We saw this whole kind of evolution as he got closer to closer. Today, he is probably at Twitter headquarters up in San Francisco and he is going to have a meeting where somebody’s going to explain the actual reality of what it is he bought, and he is going to put his face in his hands and cry and he’s going to have to now deal with the reality.

So I think we have to discount everything that he has said in the past, and now that he is going to see the actual numbers and talk to people about what that looks like and to see the upsides and downsides of each of these decisions. Because it is easy for him to throw off 280 characters on a decision he’s going to make.

Now, if he’s going to decide what are the rules for banning people, somebody’s going to come with a 50 slide deck saying, “Here’s our history here. Here are the things we perma ban people for, including child sexual exploitation, including spam, including bots,” including a bunch of stuff that Musk has spoken out against. And so those are the kinds of things that now that he has to look at this huge deck, there’s no way he makes the same kind of decision that he made when he just throws it off on in a Tweet.

Evelyn Douek:

Right. And so the other meeting that he’s going to have today or soon is with his lawyers or the general counsel of Twitter or the legal team who are going to [inaudible 00:14:09]-

Alex Stamos:

Which he has fired. Right? So he’s also fired all the lawyers.

Evelyn Douek:

Right, whoever it is now. He’s going to hire someone and then he’s going to have a meeting with them.

Alex Stamos:

Which I want to say from a corporate governance perspective, firing the CFO, your general counsel and your head of policy and your CEO on the first night means that nobody’s in charge of some pretty critical functions that have to operate today.

Evelyn Douek:

Right. And the legal framework here is really complicated. These companies work in a really complicated legal framework and it’s changing really, really rapidly. One of the things that I think people don’t necessarily appreciate is there is no returning to the youthful, halcyon on days of these platforms where they operated in a much more free unrestrained legal environment. So the idea of just returning Twitter to its youth is somewhat of a fantasy. Like let’s start with domestic again, we’re seeing a bunch of different changes in domestic law or potentially will with all of these cases going to the Supreme Court.

So one of them is this NetChoice litigation arising out of both Florida and Texas. Depending on what happens with them at the Supreme Court, if they uphold the must-carry rules, Musk’s value proposition of being the main platform that hosts Trump will no longer be the case because maybe all platforms will have to host politicians in the lead up to that. I think it’s fairly unlikely that the court’s going to uphold that portion. But I do think that there is a really good chance that the court might uphold transparency obligations, which are really onerous and burdensome where the companies have to report on all of their content moderation.

And so Musk is going to run into all of those laws. It’s going to potentially open up a lot more room for state-based regulation in a whole bunch of other places. We have seen … Meta was fined $25 million dollars over the weekend for breaches of an old Washington State transparency law. That’s a drop in the bucket for Meta, of course, but I think it’s a harbinger of what’s going to come with a whole bunch more state-based regulation. So there’s that.

And then there’s also these cases that the court has [inaudible 00:16:02] just this month, Gonzalez and [inaudible 00:16:04]. Now, if Gonzalez comes out the way of the plaintiffs and platforms are suddenly liable for all of the content that they amplify or algorithmically touch, I think Elon is suddenly going to have a very different view of content moderation. So if Twitter can be held liable for anything defamatory, harassing, threatening on its platform that it has algorithmically amplified in some way, I think this whole free speech thing is probably going to evaporate pretty quickly.

Alex Stamos:

Yeah, absolutely. It is, again, a crazy time for Elon to insert himself into this at exactly the moment at which Section 230 and First Amendment protections for the platforms might be crumbling in SCOTUS and that he might have all of these new legal responsibilities, which he has mostly taken on himself, which is the other crazy thing here. When you talk about platform having liability, generally you’re talking about that liability being spread across millions of shareholders, and in this case it looks like 80 some percent perhaps of the liability effectively accrues to his own personal net worth. So the Gonzales case, yes, he’s probably getting briefed by whoever’s left in the legal department today on, “Oh, by the way, the Supreme Court’s about to decide whether you have liability for any terrorist groups utilizing this platform.” That’s going to be an interesting discussion for him.

Evelyn Douek:

All right. So speaking to regulatory frameworks, let’s zoom out and go international now.

So overseas lawmakers are also having fun with this. The EU’s Thierry Breton tweeted a wavy hand, “Hi, Elon Musk” in Europe. This is [inaudible 00:17:36] tweeting Elon Musk’s “The bird is free” tweet. “In Europe, the bird will fly by our rules. #DSA.” Of course, he’s referring to the massive regulatory package, the Digital Services Act, which has just been passed in the EU that has all of these obligations for very large online platforms, [inaudible 00:17:53] like Twitter that Musk is going to have to comply with.

There was this really funny interaction. When Musk first announced that he was buying Twitter, he made all of his tweets about being a free speech platform. And then a couple of days later, they release this video of him standing with Thierry Breton shaking hands saying, “Of course, of course, we will comply with EU law.” It kind of looked like this weird hostage video of him having to stand there saying, “Yes, we will comply with EU law.” And Thierry Breton re-upped that video yesterday. So again, Musk isn’t operating in the same legal environment that Jack Dorsey was 10, 15 years ago.

Alex Stamos:

Yeah. So when I say Musk has bought himself into a hellish existence, I think the international side is much more true because his personal focus has been on a handful of US political disinformation decisions or harassment decisions. He’s mad about The Babylon Bee and [inaudible 00:18:47], the Hunter Biden’s laptop, Trump being de-platformed. Those are a tiny, tiny fraction of the day-to-day decisions that are made from a content moderation perspective. And then when you zoom out globally, things become much harder. Mark Zuckerberg hated content moderation decisions so much that he spent several hundred million dollars to set up this entire external oversight board to fund it, to hire all these people to try to make these decisions for him and has now pivoted the entire company to spending billions of dollars on VR.

Evelyn Douek:

He’s literally trying to eject from the real world to get away from these legal regulations.

Alex Stamos:

Right. And Musk was like, “Oh, well I could just do that,” and just throws himself in. The really hard thing for Musk, and this is where I’m saying I think this is a huge strategic mistake for him, and the people who should be really angry today are Tesla shareholders because most of Musk’s net worth is tied up in Tesla shares. Tesla is a company that actually makes stuff that has to follow the law to ship products around the world and has huge exposure to all of these different regions that want to control the internet. That is, as you and I talk about all the time, the number one fight over the next 10 years is going to be who gets to control what speech is allowed online, and every government outside of the US with our First Amendment wants to do that. And even there’s people in the US who want to, there’s restrictions on that, but around the world, those restrictions generally don’t exist.

So Musk has done something that is unprecedented here, which he has said, “I am personally responsible for content moderation on this platform. And by the way, most of my money is in a car company that makes and ships cars in all of these jurisdictions.” Tesla has a factory in Berlin. Berlin, the headquarters of European content moderation with Germany and NetzDG. He has a factory in Shanghai. I’m looking at Tesla’s quarterly report and the last quarter, they just reported it about nine days ago for Q3 of this year, they had $20 billion dollars in revenue. That’s fantastic. Good for Tesla. Half of that came from the US; $5 billion came from China. So there has never been an example of this, of a major social media platform, where the CEO has had $5 billion dollars in revenue that goes to his personal net worth per quarter that is under the control of the Chinese Communist Party.

Facebook is blocked in China, so Mark has no exposure there. Twitter is still blocked in China, so Twitter shareholders have no exposure in China. Google is blocked in China. So all of these companies, the control the CCP has over the company, the leverage they have is limited. The best example would be Apple where Apple makes a huge amount of revenue and most of their products in the People’s Republic. And, as a result, Apple has done more for the People’s Republic of China and the Chinese Communist Party than any other company has done for any authoritarian state. And that is exactly the kind of leverage that they now have on Twitter.

And so you’re going to see immediately that leverage used to try to change the rules around how Chinese propagandists, both overt and covert, are treated. It is a completely crazy place for him to put himself in. And if I’m a Tesla shareholder, I’m extremely angry that my $5 billion dollars per quarter, $20 billion dollars a year of Chinese revenue of which I own a little bit of that future revenues, that those have now been put at risk because Elon wants to own Twitter for his own personal amusement.

Evelyn Douek:

So The Washington Post is already reporting this morning that Twitter accounts associated with the Russian and Chinese state media outlets have already tweeted at Musk to remove the labels that they put on identifying their accounts as associated with state media. So that pressure has already started. Who knows what is going on behind the scenes? How worried should we be about that? If Russian and Chinese propaganda, they are moderated a lot less, what’s the impact of that?

Alex Stamos:

It’s a big deal. We talked about this at Moderated Content a couple of weeks ago is that we’ve seen a massive change from the People’s Republic of their propaganda capabilities to not just be about China but to directly interfere in US and other Western politics. Just this week, Mandiant which is a threat intel company that belongs to Google now, released a whole report about another Chinese campaign aimed at American politics. So Twitter has been an absolute leader in this space. They don’t have the resources or the number of people that Facebook has, but they’ve been much more transparent and they were the first movers on a bunch of things such as the labeling of state media. So I think it’s going to be a big deal if all of a sudden we can’t trust that Chinese and Russian influence operations are not widespread on the platform.

So we’re going to fall back to where people were in 2017, which is everything you saw on Twitter that you disliked, you said was a Russian bot or a Russian troll, only in a fraction of those cases was that true and Twitter has clawed back that trust by over and over again saying, “We found this Russian campaign, we shut it down. We found this Iranian campaign, we shut it down. We found this campaign from Vietnam, we shut it down. We found this campaign from India, we shut it down.” If they are able to leverage Musk to both get rid of the labels for the overt campaigns and then to stop enforcement on the covert campaigns, then nobody’s going to have any trust that the conversation they have on Twitter is not being manipulated by professional teams. It is a fantastic day for the Internet Research Agency in Russia. It is a fantastic day for the Ministry of State Security, the People’s Liberation Army in China.

Evelyn Douek:

Thank you for mentioning India because we’ve talked about the EU which, for all of Americans’ ire at its pro regulatory stance, is not an authoritarian jurisdiction and does have lots of protections built in for freedom of expression. We’ve talked about China, which is at the opposite end of the spectrum, and in the middle here we have India or it’s sliding down the scale in one direction.

India’s Minister of State for Electronics and Information Technology has already come out with a statement today saying, “Our rules and laws for intermediaries remain the same regardless of who owns the platforms.” So the expectations of compliance with Indian laws and rules remain. We’ve talked about how important India is as a jurisdiction to the future of free expression online. Twitter has sort gone out on a ledge by itself often in India in the recent year or so, standing up to government draconian take down orders. It has challenged them in court, it has challenged the new laws.

I think this could be one of the worst blows, one of the worst changes to what happens here, if Musk just doesn’t have the energy or the will, isn’t particularly interested in what’s going on in India or does just want to kowtow to the Indian government again because there’s a billion users there, it’s an important jurisdiction. So that’s something that I hope doesn’t get lost in this story as well.

Alex Stamos:

Yeah, I think you’re right. I think we’ve talked about India more than any other country on this podcast so far. And yes, I think India is the place where Facebook has made the most compromises because they are not blocked in India. And India is a important market for Facebook and we have seen, as a result, Twitter take the lead because traditionally Twitter has had much less exposure revenue wise to the Indian market.

One of the people who was fired by Musk last night, Vijaya Gadde, is one of the people who has fought around the world for freedom of speech against governments, including India. So they’ve already lost for all this talk about free speech. Again, it just demonstrates Musk doesn’t really know what he is talking about. He has not really grappled with what the international dimensions look like here. He has already gotten rid of the person who is most prominent in pushing back on all of these controls, and India will be a big one.

Now the upside for Musk here is that Tesla currently doesn’t sell products in India, so his exposure in China is much greater. So I think we’ll see China first just because that’s where the revenue is flowing into Musk’s pocket. But India will definitely be the place where he will face a lot of this. And when he talks about we will follow the law, that is the crux is that you want to follow the law but you also want to protect human rights and you want to protect free expression. So there is no way that everything he has said about free speech and everything he has said about following the law, those things are not compatible. It’s just not compatible around the world. So he is going to be in for really rough ride as he learns the challenges. And I think you’re right, India is going to be a big one, but I do think China will be first just because of the massive exposure he has there financially.

Evelyn Douek:

One of the reasons why we talk about India a lot is not just because of India because it’s a harbinger and so it’s not just about India, it is about a lot of these other jurisdictions. We don’t have time to go through them all. Obviously, there are a lot of other states doing exactly the same thing. Are there any in particular that you want to highlight? People are talking about Brazil a lot with its election coming up in the coming week.

Alex Stamos:

There’s a very important and some would say ugly race going on in Brazil. Very personal, lots of disinformation, lots of claims going back and forth between Bolsonaro and the previous president, Lula. Lula is winning and so a fascinating question that in Brazil is whether Bolsonaro actually steps down if he loses or if he tries to pull a Trump and somehow disrupt the transfer of power, this will be an immediate impact on Twitter.

Now the most important platform in Brazil is WhatsApp. It’s not Twitter but it does have some impact. They do have Brazilian users and so I think that is the first international crisis that he’s going to get briefed on. That might be the first time when they come to him with Bolsonaro is not leaving office and he also has control over … I believe Teslas are sold in Brazil. Then it might be the first time he realizes that there’s like a direct tie between his personal financial stakes and having to make decisions in all of these massive geopolitical crises.

Evelyn Douek:

And these geopolitical crises aren’t the only way, of course, that financial stakes and content moderation are tied together. I thought it was really interesting that his first tweet around when the sale actually closed was to advertisers and saying, “We’re not going to have a hellish free-for-all on this website,” reassuring them brand safety is the invisible hand of content moderation. That is where a lot of pressure comes from advertisers to say, “Look, we don’t want to appear next to crush videos or terrorist content or hate speech and the N word just being repeated nonstop.” Advertising is currently 89% of Twitter’s revenue. Of course, Musk has talked about a subscription model, but we’ll see whether that comes in. So I think one of the themes of this episode is all these unknown levers of pressure that Musk doesn’t realize he’s getting into by making this purchase and making himself the spot man for all of this, and I think advertising is going to be another big one there.

Alex Stamos:

Yeah, certainly. I mean he has taken on a huge amount of debt to finance this, that Twitter Inc. has taken on a large amount of debt. He also still has a fiduciary responsibility because he has limited partners in this deal. So they don’t have any control, but he still has a fiduciary responsibility to all these other shareholders, including the Kingdom of Saudi Arabia.

So yes, he has put himself in a very difficult position because he can’t just run this thing into the ground and not face any consequences because you have a bunch of billionaires who now have thrown money in and who have very expensive lawyers. If he gives up all revenue, if he just completely destroys their investment, he is exposed to them. So yeah, I think brand safety is going to be one of the drivers, something again that he didn’t really understand.

By the way, on Brazil breaking news, I just searched for it. If you search for Elon and Bolsonaro, there are a bunch of pictures of them shaking hands talking about a Tesla factory being built. This was in May of 2022 Elon visited and, so yes, very possibly we could have a direct phone call from Bolsonaro any day now to Elon’s cell phone saying, “If you want that factory, this is what needs to happen on Twitter.”

Evelyn Douek:

He may change his cell phone number in the next week after all the personal calls he’s going to get about content moderation decisions. I mean this is the Ye model of content moderation, right? Let’s have personal phone calls where people are doing naughty things on our website and see if we can clean it up.

Alex Stamos:

Right. Every day his executive assistant’s going to bring him the list of the top 20 offenders that he has to personally call and ask them to be nicer on Twitter.

Evelyn Douek:

A good model. Let’s see if it works. I have this fantasy that the real constraint here will be the app stores and Google Play store and the Apple App store will, like they have with Parlor and Truth Social, impose a lot of constraints on Musk in terms of his content moderation. I think it’s probably fictional, but it would be fun to see the Silicon Valley rivalry play out in that way.

Alex Stamos:

I feel like things are moving the other direction there in that the app stores have been letting some of the platforms back on. I think this is where the antitrust issues really get heavy. And if you’re Apple and you want to have an antitrust fight, you’re going to have it on your 30% stake of taking all the money. You’re not going to have it on whether you let Twitter in or not. So I think that it’s unlikely to be a control here because it would become such an immediate antitrust issue and you’re now dealing with somebody who would immediately go to Congress and to court versus try to come up with some negotiation.

Evelyn Douek:

It would be a fun season too to this inevitable tele series that is going to be made of this whole drama.

Alex Stamos:

Well, somebody said when you’re talking about Twitter or Musk and now they’re together, whatever is the funniest outcome is the most likely. It’s like a different kind of Occam’s Razor.

Evelyn Douek:

Right. All right. Any other hot, spicy takes that you want to get on the record before we close?

Alex Stamos:

No. I mean we’ve made some predictions. I think it’s going to be up to us to be working on empirical evidence to demonstrate whether these things are true or not. Again, I don’t think anything has changed yet except perhaps Musk’s understanding of what he has bought himself into.

Evelyn Douek:

Yeah, I think that’s a really important point. I think a lot of people with content moderation have a lot of confirmation bias in terms of seeing what they want to see in terms of results. So the extent of actual change at Twitter needs to be demonstrated or researched rather than just speculated. I think there’s a lot of flapping our arms going on at the moment as a result like this could be the end of the internet as we know it, but it’ll be interesting to see whether it is or whether Musk gets bored within a week and just moves on and the bureaucracy continues to churn much as it was. I don’t know.

Alex Stamos:

Well, I don’t think he can just walk away now, though. With the ownership stake and what he has said publicly, he is not … It took Zuckerberg years to try to distance himself from these decisions at Facebook and there’s just no way Musk does that without spinning it back out.

Part of the problem is, though, the valuation of which he bought Twitter is so incredibly high. So let’s give a shout out for Parag. People are joking about him being the worst CEO ever. From a Harvard Business Review perspective, that man returned more value to shareholders. Unbelievable. He sold the company for at least twice, maybe three times what it’s actually worth. He completely crushed Musk in court. He was able to negotiate this thing and he got fired. He gets a $50 million dollar exit package on top of the fact that all of his RSUs just got bought out at a massive inflated …

That guy, they’re going to build a statue of Parag at Stanford Graduate School of Business because what he did in less than a year for Tesla shareholders or, I’m sorry, for Twitter shareholders is crazy. Tesla shareholders, on the other hand, should be pretty mad. That’s, for me, just a complete no morality from a Delaware Court of Chancery shareholder responsibility corporate law perspective, this will also be fascinating because I think Musk has again made a big mistake from a complete financial Wall Street perspective.

Evelyn Douek:

Awesome. Well, we will have to have a regular Musk Twitter update segment on the show as we watch this unfold.

That has been Moderated Content’s first emergency edition. Massive thanks to producer Brian Pelletier for turning this around so quickly and to Justin Fu and Alyssa Ashdown to help me make sure it reached your ears. See you in a few days.