Some Thoughts on Twitter

Like some people, I’ve been left scratching my head over Elon Musk’s decision to take over Twitter, although I have been enjoying the show so far. As somebody who works in IT, it’s been highly amusing to watch the internal business of Twitter’s IT department spill over into the public sphere over the past few weeks.

Musk has become pretty good at meme-ing and trolling

The thing that confuses me about Musk’s Twitter acquisition is that I don’t see any way for him to “win” but I see a whole lot of ways for him to lose. It looks to me like a lot of downside risk for very little potential upside gain. Aside from the money, the main loss he would suffer would be reputational damage. Given the value of his reputation and the very public nature of his Twitter takeover, I’m surprised he would gamble it in such an open fashion. If this were a poker game, Musk seems to have gone all in but it’s not clear what is in the pot or even what the rules are by which Musk can win.

Twitter seems to me a useful microcosm for the whole internet. Can Twitter actually be profitable? Can the internet be profitable? Is the internet profitable? Most people would assume the answer is ‘yes’, but it’s not at all clear that it is and the reason is because the arrival of the internet in the form we know it coincided with increasing manipulation of the financial markets. Almost all countries have been printing money in recent years including and especially the USA.

The way the system works is that newly printed money is given to financiers who invest it in the “real economy”. In the normal course of events, they would only invest in things that will actually generate a return. However, once financiers came to understand that the government was going to keep the money tap open indefinitely, they no longer needed to care about long-term returns. They started looking for short term pump-and-dump vehicles where they cash out and move onto the next thing.  The IT industry is one of the main outlets for this kind of manoeuvre in the form of start-ups, which is how Twitter started its life.

From the point of view of investors, a start-up is like a pig that you’re fattening up for market. Ideally, this would involve building an actual viable business that has things like positive cash flow and maybe even, heaven forbid, runs a profit. But if the system can find a way to simply create the illusion of a viable business and sell it to a bunch of suckers (institutional investors like pension and superannuation funds) then nobody really cares and, as long as the central bank money tap stays turned on, the market always goes up even if the companies that constitute the market are not really viable businesses.

We can see how dependent the IT industry has become on the central bank money tap because right now there’s a bloodbath going on with layoffs galore, especially in the start-up space. This is due to the tightening of credit market conditions and the rising of interest rates. We may be entering the end game of the current status quo because the money printing of the last decade and more is finally showing up as real-world inflation rather than asset price inflation (of course, asset price inflation is very real if you’re trying to buy a house).

What people think a start-up looks like

Most people would assume that start-ups are plucky young up-and-comers, lurking in garages or dingy rental properties, working 14 hour days and living on 2-minute noodles and instant coffee. There are still some like that. But start-ups that get financing up-front are usually run like mini-corporations. They rent office space, pay payroll tax, have a HR manager and, perhaps more importantly, they use the products of the IT giants.

Every start-up will have a commercial account with Google or Microsoft to handle internal requirements like email and video-conference. They will also host their website with one of those companies or, more likely, with Amazon (AWS). You can think of modern start-ups as digital serfs paying a tithe to their feudal overlords. What this means in practice is that if there is, for example, $1tn of new capital pumped into the start-up market each year, a significant portion of that will end up flowing into the coffers of Amazon, Google and Microsoft as well as an array of second-tier corporations.

What a start-up really looks like

The internet as we know it has become fundamentally tied to overarching political and economic conditions in which endless money printing has become the norm. It’s not an exaggeration to say that this money printing is now the cause of geopolitical conflict. A big part of the reason for the war in Ukraine was Russia saying enough is enough. Putin has openly stated that one of his goals is to bring an end to US dollar hegemony because he is sick of having revenue earned in US dollars inflated away. It’s fair to say that many other countries agree with him and will willingly move to an alternative once they think the time is right. When that happens, all bets are off and it’s not at all clear how much of the internet will be left in the aftermath.

Whether Twitter will be a viable company in that new world is anybody’s guess. The entire calculus of the poker game we call the modern economy is set to change drastically in the years ahead but it’s impossible to know when and how that will play out. Within the current calculus, Musk has shown himself to be a highly competent player; the best, if you go by net worth. So, the question then becomes: within the parameters of the game as it currently stands, what would success look like for Musk in relation to Twitter?

Difficult to achieve but easy to see

The first thing to note here is that Musk’s main other companies, SpaceX and Tesla, deal with domains that we might call pure engineering. The technical problems in such domains are very difficult but the results are easy to understand. An electric car either runs or it doesn’t. A rocket launch (and re-landing) either happens or it doesn’t. If you buy a Tesla and it breaks down, you’re unhappy. If it doesn’t, you’re happy. There’s no ambiguity there.

With Twitter, it’s the other way around: the technical problems are easy but the success criteria are obscure.

The original Twitter platform ran on a technology called Ruby-on-Rails and, within that technology, Twitter was dead easy to build. In fact, it was a standard training exercise you would give to an intermediate programmer to write their own version of Twitter. Of course, Twitter is a global website with enormous amounts of traffic. But, the technology to handle that traffic comes almost out of the box these days. If I was to guess, I’d say building and maintaining Twitter is an order of magnitude easier as an engineering challenge than building and maintaining a Tesla car or a SpaceX re-usable rocket. Therefore, I’d expect Musk to have no problem handling the engineering side of the Twitter equation.

It’s on the “customer experience” side of things that Twitter gets weird. If you buy a Tesla, you will be happy if the product performs as expected. And everybody is happy when a SpaceX rocket does something cool like land on a platform in the middle of the ocean.

With Twitter, being unhappy is the product. In recent years, Twitter has become a bottomless pit of misery; the digital equivalent of the biblical gnashing of teeth and rending of garments. A sizable portion of the users on Twitter, or at least the most vocal ones, use the platform in exactly the same way that George Orwell described as the two minutes of hate in 1984.

The horrible thing about the Two Minutes Hate was not that one was obliged to act a part, but, on the contrary, that it was impossible to avoid joining in. Within thirty seconds any pretence was always unnecessary. A hideous ecstasy of fear and vindictiveness, a desire to kill, to torture, to smash faces in with a sledge-hammer, seemed to flow through the whole group of people like an electric current, turning one even against one’s will into a grimacing, screaming lunatic. And yet the rage that one felt was an abstract, undirected emotion which could be switched from one object to another like the flame of a blowlamp.

A better description of Twitter could scarcely be written. But it was not always so.

I was a relatively early user of Twitter and in the early days it was almost devoid of animosity and trolling. Many of the early users of Twitter were scientists, artists, writers and thinkers including quite a lot of famous names. It was not uncommon to be able to read an interesting, real-time conversation on some subject and then have a very well-known expert in the field join in spontaneously. In those days, I used Twitter almost like an RSS feed with the links to blog posts or other interesting material being the main drawcard.

The tide turned once the politicians and propagandists got involved. But it was Trump who really turned Twitter into the 2 minutes hate with his presidential campaign. I remember that time well. I was following a couple of hundred people including a handful of friends, a larger handful of colleagues, some well-known names in my profession and a variety of other interesting individuals. It was extraordinary to watch people I personally knew turn instantly into frothy-mouthed loons who became so obsessed with Trump that their entire Twitter output became an endless diatribe of hatred. It was like watching somebody get sucked up into a vortex. Years later I saw the same dynamic, only worse, kick into action at the start of corona and I called it quits and I closed my account.

Why Twitter and social media in general suffers from this phenomenon is an interesting question. I suspect that it’s related to the basic dynamics of herd psychology. History matches Orwell’s 1984 description and shows how easily a mob can be roused to anger. You just need to provide a scapegoat. Twitter has an endless supply of scapegoats in the form of other users, some of whom are anonymous and some of whom are famous. Those scapegoats, like in 1984, are projected onto a screen (a computer/mobile phone screen) with the inherent de-humanisation entailed by that fact. Thus, social media combines the psychology of the 2 minutes of hate with the psychology of the old-fashioned public square hangings with the mob as judge, jury and executioner. Twitter accidentally provided political actors and propagandists with a tool to effortlessly form and manipulate mobs.

Musk seems to understand this on some level. One of his first tweets after buying the company was something like “let’s make Twitter maximum fun.” It’s a nice idea. But it seems to me that many of his users are very happy being miserable. Misery loves company and Twitter provides a global network of people to be miserable with. Amusingly, one of the leading hashtags over the last few days is about how people are leaving Twitter or Twitter is “dead”. People are using Twitter to dance on the presumptive imaginary grave that would be caused by them not using Twitter. That might just be Peak Internet.

It’s fitting that one of the big questions right now is whether Musk will let Trump back onto the platform. This one decision is symptomatic of the whole tangled mess that Musk has gotten himself into. Musk has now taken personal and public responsibility for a decision that is going to piss off a large group of his users whatever he does. He has all but guaranteed that he will become the scapegoat for a two minutes of hate that will last at least up until the next presidential election with either pro-Trump accounts bleating that it’s unfair that he’s banned or anti-Trump accounts bleating that it’s unfair that he’s back.

This doesn’t even get into the financial problems facing Twitter. How can Musk balance the demands of advertisers for a level of certainty in relation to ad placement against the demands of users not to have their user experience excessively manipulated. His experiment with charging users a fee for a premium version of Twitter speaks to this tension. Twitter might be viable if everybody paid a small fee for the service but in the internet world where people expect everything for free and have already been using the site for free for years, there’s no way such a move is possible. That should mean Musk will have to cave to the demands of the advertisers in order to generate revenue which is exactly what the previous management had already done. (Although note that, due to the financial conditions mentioned at the top of the post, it’s not clear that Musk needs to make Twitter turn a profit).

It’s noteworthy that Musk is on record as saying that he is on the autism spectrum. Autistic people are really good at solving engineering problems like car and rocket design. Those problems require discipline and focused attention over long periods of time. Modern Twitter is the exact opposite. It’s a steaming dung heap of emotional-ideological waste products swirling around a fetid cesspool of political doublespeak. Musk needed industrial-strength gumboots to wade into that mess. It looks to me like he only brought sneakers.

Whether Musk will drain the swamp, get dragged into it or somehow cut his losses and run is going to be fascinating to watch. I give him full respect for saying upfront that he’s going to try a heap of different things and see what works. He’s clearly not afraid to fail, even in public view, which is the true entrepreneur’s spirit.

Update: Trump’s back. Let the 2 minutes hate begin! –

21 thoughts on “Some Thoughts on Twitter”

  1. Niall Ferguson wrote a book called “The Square and the Tower”. His main point was that the whole narrative of “social media renders history irrelevant as it is completely unprecedented” and that now social problems will become tech problems, ignores the fact there was in fact a historical precedent – the invention of the printing press. Social media just accelerates the process, but we know what happens when humans get a way to increase their ability to spread information. The same human impulses take over.

    As for the tech side of this, I think the growth of the internet caused an inflation of the amount of software that needs the internet. This is nothing new, personal computers used to be consoles for central mainframes, but now it is not clear if much of this traffic is even for outsourcing computation.

    For example, my brother used to use a program to stream videos to our smart TV (why stream over the net, I simply connected a cable). His program required him to be connected not only to our local network, but to the internet. This caused him a problem as our living room, due to poor reception, had its own wireless network that did not connect to our router. I easily found him an open source alternative that did not need to connect to the internet to stream over wifi.

    This becomes increasingly common, and most of the people I know take this for granted, but there is no technological reason for a program to connect to the internet unless it needs real time information from other users or servers. I think programmers are taking advantage of the size the internet in order to force users to pay for subscriptions, or agree to have their information collected and sold (A bubble by itself, who cares if I spend X minuets a day looking at videos about raising chicken?). I suspect we would not be in this problem if the internet was not subsidized.

    What’s not clear to me if why do you think Twitter will be in trouble once the Internet’s bandwidth shrinks? I think text based platforms like twitter will do fine, what will disappear are platforms that rely on video and image streaming (remember when images would load from top to bottom?), like Facebook, Youtube and Netflix.

  2. Bakbook – yeah, human nature doesn’t change much. For example, Musk is currently playing the role of a Roman emperor at a gladiator contest. He ran a vote asking people whether he should buy Twitter and he just ran another one asking whether Trump should be let back on. Then he gave the mob what they wanted. Meanwhile, the pre-Musk Twitter had become just like the Inquisition with shady ideologues banning (not burning) people on grounds that nobody understood.

    I don’t claim to know what will happen with any of the big platforms but another historical precedent might provide a guide: bread and circuses. It may well be that the internet continues to be subsidised well beyond what might seem prudent just in order to keep the population distracted.

  3. Has Musk transcended the rubicon with buying Twitter? Maybe he will become the next Ceasar, as quite a few people are longing for a strong leader to save them?

  4. Skip/Secretface – my understanding is that Musk can’t become President/VP because he was not born in the US. Maybe this is the best he can do? He’ll be a virtual Caesar destroying what’s left of the legacy media and controlling the flow of information with a iron fist 😀

  5. It’s the appeal to the plebs that seems to be the strongest signs to me. It’s also the beginnings of giving the middle finger to money (profit?) and a at least public ally stated turn back to ideals (free speech?). With politics as bad as it is in the USA, maybe it matters less and less who is in the White House.

    I’m also unconvinced of the potential because it’s not like Musk is not a massive believer in progress and techno utopian fantasies and has no military presence whatsoever. Although the belief system probably comes with the territory in a potential Faustian Caesar.

    I think Putin is framed this way too, in both a positive and negative fashion.

  6. Skip – it is possible that Musk just really believes in free speech. Most genuine engineers and science types do. Given all the other major tech platforms are increasingly obviously rigging their data, if Twitter is seen to remain unbiased it could actually work in his favour especially in the lead up to the next presidential election.

  7. This whole “trump’s back in twitter” thing makes me want to read JMG’s book “The King in Orange” before the next presidential campain. Call it intelectual FOMO if you will.

  8. Bakbook – will be interesting to see if Trump can repeat the magic (literally and metaphorically). He no longer has the advantage of novelty and being the outsider plus he’s got some serious baggage politically (the vaccine being the main split among his supporters).

  9. Hi Simon,

    Surprisingly, the prices for that stock seem to be on the up and if the investors slowly unload their positions they may have made an astute purchase. But then markets are a bit weird with the ever expanding money supply and I don’t fully understand it. I read somewhere a while ago that the US, and more generally the west, has been able to previously export their inflation, thus the outrage on other shores. As the demand for US dollars declines, the inflationary pressures will be reflected back upon the west – and here we are today. It seems very unusual to expand the money supply, expand the government and raise interest rates all at the same time. Sooner or later under that regime you run out of consumers. The whole thing is weird, but I don’t expect the game to go splat any time soon – could be wrong though in that regard.

    It’s the debt that provides the inertia to the present arrangements. My best guess at this stage is that older folks will soon be chipping in (in a big way) and helping out their kids finances – thus reducing consumption of retirees, consumption of families, consuming up all their excess assets, and propping up the existing debt arrangements. Now if you had my folks and/or Sandra’s folks, and were in need, you’d be stuffed. 🙂 In the recession in the 1990’s it was the excess things that were sold off first – i.e. holiday homes – which drove down prices. But here’s the thing, immigration has been so great that demand for housing is off the charts, and so we might not see that large downwards pressure. But take a look at what is being said about the luxury car market, and that is filtering slowly into the second hand car market. Things are happening, that’s for sure. Mark my words: Poverty will be on the rise as people fall off the sinking ship.

    And I’d also be curious to know why he bought that blue bird thing. One little whisper in my mind suggests he might want to know people better. 🙂



  10. Chris – it’s fun to watch. I notice Musk was running another poll today about reinstating banned accounts. Even as a pretend/digital/virtual Caesar, he’s showing up how the corporations, politicians and elites in modern society not only don’t give the public what they want but actively give them what they don’t want. He could actually usher in the period of Caesarism.

  11. Thanks for reminding me that Musk is openly autistic, oops, neurodivergent. I’ve been intrigued by the recent epidemic of self-diagnosed neurodivergence, including folk I’ve known, if obviously not as well as I thought, for years. What does it mean? Was it under-diagnosed in the past or has it just become trendy? Popularised by TEDx revelations etc.?

    I’d be surprised if Trump’s health holds out for two more years.

  12. Shane – yeah, I’m not too enthusiastic about the framing of neurodivergence just like I’m not a big fan of the concept of mental “illness”. But, then again, I’m starting to think I’m a bit of a closet Christian 😉

  13. Yeah I dunno about the whole neurodivergence thing. It’s seems to me that people like Musk and a lot of engineer types in general just have a very masculine brain (systemising, interested in things rather than people, individualistic etc) . Really autistic people could not do what Musk does.

    It always made sense to me that we are all on a yin/yang mental spectrum, and some tend to extremes on either end. Males usually lean the masculine side, hence why aspergers etc is weighted towards males, though of course women can tend Yang too, just less commonly.

    The interesting thing is what is the extreme feminine brain – some have said it is anorexia and other forms of excessive worrying about what others think, or even over-empathising…. the devouring mother? Maybe we need Dad to speak up.

  14. Shane – hah, yeah I remember that post. I’ll think I’ll stay in the closet. Not sure my Christianity will survive exposure to the light. Anyway, as William Blake said: the kingdom of God is in the heart (which seems to me to be the true Christian teaching).

    Skip – now there’s a dangerous question! The Devouring Mother would represent one form because it is a kind of inversion of empathy i.e. destroying others through connection. Neuroticism is also a traditionally feminine issue: anxiety, fear, envy, guilt.

  15. Skip & Simon – the ‘extreme feminine brain’ (LOL) looks to me like, e.g., using prescribed language so as not to hurt anyone’s feelings. Like, you can’t say an idea or effort or policy or whatever is ‘lame’ anymore because a person w/ physical challenges (or whatever the latest PC term is) might hear you – unless they’re deaf… which reminds me, it’s not OK to call me tone-deaf despite my apparent lack of empathy, because if you post an insult like that anywhere, a deaf person (or one of their advocates) might read it. But you could call me ‘insensitive’… which reminds me of the predictably growing popularity of the ‘Highly Sensitive Person’ syndrome (another manifestation of neurodivergence). And, of course, another example is support groups w/ rigorous codes of conduct etc. For instance (to cite a long-ago personal experience), the members of a writers’ group that meets in a women’s library bring samples of other people’s writing to share. The unwittingly offensive person reads out a passage from a historical novel about a paedophile describing a sexual encounter between a male teen & a female child. Upon which a woman in the group grows hysterical because she’s a sexual abuse survivor (is that the right term?) & berates the offender, who futilely protests that the offending book was borrowed from the women’s library. Anyway, it’s the thing of responding to life by turning each social context, including the higher ed campus, into a virtual womb.

  16. Shane – And that sounds like the Devouring Mother to a tee. I would argue that the woman who became hysterical is the archetypal Orphan in that story with an implied Devouring Mother archetype at the group (collective) level. I’ve seen that exact dynamic in the workplace only somebody was complaining about something that could have been offensive to some unspecified group of people. Management gave into them and in doing so threw under the bus a few people that had been involved in a perfectly innocuous conversation because the implication is that they should have been more sensitive. It was a particularly egregious example as there was simply nothing about the conversation that a normal person could have conceived in the way the complainant twisted it and so undermined any kind of natural justice. All done in the name of “safety” and “compassion”, of course.

  17. Simon — your duo of startup pics set off a loud WOW! ? The stark juxtaposition of a bunch of geeks covering every cliché, and neatly arranged empty chairs in vacant artificially-lit space… just too good not to stop in one’s babooshes and take few moments to admire ?

    Onwards again, one sees ‘being unhappy is the product’ of Twitter… and has to stop once more ?

  18. Daiva – experience has been my teacher there. How can you convince a group of people working for what’s, in essence, a mini-corporation that they are doing something cool? Tell them they’re working in a startup 😀

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