Yahoo Finance Twitter will give Elon Musk bot data after billionaire threatened to pull deal
Twitter plans to offer Elon Musk access to its “firehose” of raw data on hundreds of millions of daily tweets in an effort to push forward the Tesla billionaire’s agreed-to $44 billion acquisition of the social media platform.
Mr Musk’s lawyers sent a letter to Twitter claiming that the company was attempting to ‘resist and thwart’ his information rights.
“As Twitter’s prospective owner, Mr Musk is clearly entitled to the requested data to enable him to prepare for transitioning Twitter’s business to his ownership and to facilitate his transaction financing. To do both, he must have a complete and accurate understanding of the very core of Twitter’s business model - its active user base,” lawyer Mike Ringler wrote in the letter. “Based on Twitter’s behaviour to date, and the company’s latest correspondence in particular, Mr Musk believes the company is actively resisting and thwarting his information rights.”
It continued: “This is a clear material breach of Twitter’s obligations under the merger agreement and Mr Musk reserves all rights resulting therefrom, including his right not to consummate the transaction and his right to terminate the merger agreement.”
This would suggest that Mr Musk would not have to buy the social media company - as Twitter is hoping he will - without paying the $1bn separation fee. Mr Musk waived his right to due diligence when originally purchasing the company.
When asked for comment, Twitter did not confirm the reports. Instead, it referred to a statement it gave on Monday that it will “continue to cooperatively share information with Mr Musk to consummate the transaction in accordance with the terms of the merger agreement”.
Mr Musk, has argued, without presenting evidence, that Twitter has significantly underestimated the number of these “spam bots” - automated accounts that typically promote scams and misinformation - on its service.
Twitter chief Parag Agrawal has said that Twitter has consistently estimated that fewer than five per cent of its accounts are spam; but Musk has disputed that figure, contending in a May tweet that 20 per cent or more of Twitter’s accounts are bogus. In response to a detailed thread Mr Agrawal gave documenting how it calculates bots, Mr Musk replied with a poop emogi.
On Monday, Texas Attorney General Ken Paxton also announced an investigation into Twitter for allegedly failing to disclose the extent of its spam bot and fake accounts, saying his office would look into “potential false reporting” of bots on Twitter.
Tesla relocated its corporate headquarters to Gigafactory Texas in December 2021, and has opened a Tesla factory outside of Austin this year. Mr Musk personally lives in Texas, and SpaceX runs a major manufacturing and launch facility there.
The Washington Post first reported Twitter’s plan to provide Musk with full access to the firehose, citing a person familiar with the matter. Other reports suggested the billionaire might only receive partial access.
Twitter's reported offer could blunt Musk's attempts to use the spam bot issue to cast doubt on the deal's future. This week, lawyers for Musk accused the company of refusing to surrender information about the true number of bot accounts on Twitter. Mike Ringler, the Palo Alto, California, attorney who signed that Monday letter, told the Associated Press he was not at liberty to speak about the matter when reached Wednesday afternoon.
Fake social media accounts have been problematic for years. Advertisers rely on the number of users provided by social media platforms to determine where they will spend money. Spam bots are also used to amplify messages and spread disinformation.
The problem of fake accounts is well-known to Twitter and its investors. The company has disclosed its bot estimates to the U.S. Securities and Exchange Commission for years, while also cautioning that its estimate might be too low.
Additional reporting by Associated Press
