Elon Musk worries over Twitter fake accounts, gives fresh takeover conditions

Tesla Chief Executive Officer and world’s richest person Elon Musk has expressed concerns about presence of fake accounts on the Twitter platform.

He has thus cast further doubt over his $44bn (£35bn) takeover of Twitter after stating the deal “cannot move forward” until the social media company proves that less than five per cent of its users are fake or spam accounts.

The Tesla chief executive used his Twitter account to say the agreed deal would not progress until the firm showed proof that only a small proportion of its users were fake.

“My offer was based on Twitter’s SEC filings being accurate. Yesterday, Twitter’s CEO publicly refused to show proof of <5%. This deal cannot move forward until he does.”

Musk announced last week that the deal was “on hold” after he queried Twitter’s claim in filings with the US financial regulator, the Securities and Exchange Commission, that a small proportion of its users were fake or spam.

The Twitter chief executive, Parag Agrawal, attempted to address Musk’s concerns in a lengthy tweet thread on Monday but his efforts to explain the problem “with the benefit or data, facts, and context” were met with a poo emoji from the world’s richest man.

Without citing a source, Musk claimed in a tweet that Twitter is “20% fake/spam accounts” and suggested Twitter’s filings with the Securities and Exchange Commission were misleading. The company has said that less than 5% of its daily active users are spam accounts.

Twitter’s shares were down 1.7% in premarket trading Tuesday. The stock has erased all its gains in the weeks since Musk disclosed his stake the company and is now trading at $36.80 per share — well below Musk’s offer price of $54.20 per share.

“Twitter is committed to completing the transaction on the agreed price and terms as promptly as practicable,” the company said in a statement Tuesday.

On Monday, Musk exchanged a series of tweets with Twitter CEO Parag Agrawal about the spam account issue.

Twitter (TWTR) suspends “over half a million spam accounts every day,” Agrawal wrote. He also reiterated the 5% statistic, saying that estimate is based on “multiple human reviews … of thousands of accounts” sampled at random. Twitter has previously acknowledged that while it believes its estimates to be “reasonable,” the measurements were not independently verified and the actual number of fake or spam accounts could be higher.

Agrawal’s initial 13 tweets were met with a reply from Musk that was reflective of the unusual and extremely online nature of the deal: a poop emoji.

Musk followed up with a somewhat more thoughtful question. “So how do advertisers know what they’re getting for their money?” Musk asked “This is fundamental to the financial health of Twitter,” he added.

Musk has repeatedly spoken out against bots and spam accounts on Twitter, once describing cryptocurrency spam bots as the platform’s “single most annoying problem.” Anyone familiar with the replies to Musk’s tweets knows they are full of such scams, many of which attempt to leverage Musk’s name.

“The bot issue at the end of the day … feels more to us like the “dog ate the homework” excuse to bail on the Twitter deal or talk down a lower price,” Dan Ives and John Katsingris, analysts at Wedbush Securities, wrote in a note on Monday.

In his Twitter thread, Agrawal said most spam campaigns on Twitter use a combination of humans and automation, rather than being primarily led by bots. Parsing through legitimate and fake accounts can be complicated, he said.

“The hard challenge is that many accounts which look fake superficially — are actually real people,” he said. “And some of the spam accounts which are actually the most dangerous — and cause the most harm to our users — can look totally legitimate on the surface.”

Agrawal said Twitter had been in touch with Musk on the spam issue.

“We shared an overview of the estimation process with Elon a week ago and look forward to continuing the conversation with him, and all of you,” he added.

Sources: CNN and The Guardian