Why Elon Musk Argues Twitter Could Disrupt Media Business

The billionaire entrepreneur has been blurting out in the news media that he is driven by getting “high clicks” for his articles and exposure to advertisers. By buying Twitter Inc., it is seeking to position the social media platform as a source of real-time news for those who feed on “citizen journalism” and is setting up rivals trying to defend its current “oligopoly on information.”

“We want to be the place where you go to find out what’s going on and get the real story,” Mr. Musk said at a conference last month.

Twitter doesn’t look or work like traditional news outlets. Mr. Musk isn’t hiring a newsroom full of reporters and editors to create articles. Instead, the ostensibly media mogul relies on users and their tweets, and a fact-checking system that aims to ensure authenticity in a crowd-sourcing-like approach. And he says everything is happening live.

“If you compare that to what happens at a newspaper: they have to learn the information, submit an article to their editor, get it approved, write the article, edit it, know what day it’s going to be published. ” Mr. Musk said last month. “The news actually — what happened — was reported . . . three, four days, sometimes a week late.”

Mr. Musk, who did not respond to requests for comment, previously described how the newspaper industry operated 30 years ago. He co-founded the startup It’s called zip2. As digital platforms began to scatter the world wide web in an attempt to save some of their print advertising businesses, the company counted The New York Times, Hearst and Knight Reader as both investors and clients.

Traditionally, social media companies have typically sought to wrangle together low-cost legacy media. Mark Zuckerberg “I consider us a technology company,” he told Congress in 2018.

For some observers, Mr. Musk is worried about what he is doing now as a journalist on Twitter.

“It’s very dangerous to allow anyone to say whatever they want and not have a layer of verification and the ability to have an alternative point of view, which is carefully selected and selected, so that the reader gets a very balanced view, as opposed to the voices that are screaming at them,” Mr. Musk said at Zip2, a major venture with Knight Ridder. said Kathy Yates, executive director.

Photos: How Elon Musk made his fortune

The company was one of the largest newspaper chains in the U.S. before it was acquired during a massive shift from print products to digital offerings.

Mr. Musk has big plans to turn Twitter’s financial house around, looking at ways to make it less dependent on advertising and planning a valuation of more than $250 billion to become the world’s largest financial institution as an app that puts users at the center of their lives.

In the weeks since taking over Twitter in late October, Mr. Musk has warned that the traditional media world is pushing back against him.

“As Twitter pursues its mission of advancing citizen journalism, Media elite Will try everything to prevent that from happening,” he said on Twitter. “Mainstream media will still thrive, but increased citizen competition will disrupt their oligopoly on information and make them less accurate.”

Mr. Musk recently stripped the New York Times Verification on Twitter After the media company said it would not pay for that designation — part of Mr. Musk’s plans to raise more revenue — and compared the newspaper’s social media feed to diarrhea. On Tuesday, social media company NPR began naming and saying it would no longer pay for Twitter’s Blue Check endorsement, a state-linked media organization that owns Russia’s RT network and China’s Xinhua news agency.

Days later, Twitter began limiting posts featuring Substack, the publisher of a newsletter popular among independent journalists, which announced Wednesday that it plans its own Twitter-like competitor.

The New York Times reiterated in a statement that it does not pay “checkmark status” for its institutional accounts, while NPR CEO John Lansing said the account is unacceptable. Substack called for a reminder that the change would value and reward writers and protect “free press and free speech.”

On Saturday, Mr. Musk suggested that the Substack issues were in response to his move to “launch a Twitter clone” that made the Internet address untrustworthy. Substack CEO Chris Best disputed that argument, saying he believed the company was abiding by Twitter’s terms of service.

Twitter has never been a financial powerhouse, posting annual losses in eight of the 10 years before going private. Its influence comes from its high reach among the media, politicians and celebrities.

While it remains to be seen whether Twitter can overcome established players and regulatory hurdles to achieve its lofty goals, Mr. Musk must protect Twitter’s assets — hundreds of millions of users — that he hopes to monetize in the interim. Make sure they are caught.

At a conference in March, Mr. Musk cited Twitter’s 250 million daily users and pointed to its high status as a news app. On Friday, Twitter gave the No. 1 position to Apple Inc

The App Store ranks among free news apps, beating out Reddit and several spots ahead of CNN and Fox News.

“I’m not sure what the old media will do … at this point,” he said in March.

The danger is that battles with media companies and other high-profile users could alienate them. Nathan Hubbard, the company’s vice president of global business and media, said Twitter once spent time finding and confirming such high-profile users on the platform.

“the reason It was a Twitter media group. Because *almost* all engagement on Twitter happens with tweets from top celebrities/organizations in government, sports, music, business, news, any Kardashians, etc. Mr Hubbard tweeted last month. “They are the lifeblood of the stage.”

Some news outlets have disputed Mr. Musk’s suggestion that his journalism will influence advertisers, noting that their work has long been split between commercial and editorial divisions, and that many have strong subscription revenue.

After being labeled a government-affiliated media outlet, NPR stopped tweeting from its main account and changed its bio to read, “NPR is an independent news organization committed to informing the public about the world around us. You can find us wherever you read the news.

In the year In the late 1990s, when Mr. Musk worked with the newspapers’ business divisions at Zip 2, former colleagues said he had little interest in his partners as an operating editor. “I’ve never seen a newspaper before,” says Jim Ambras, former vice president of product development for Zip2. “He was always reading books.”

And, those colleagues said, Mr. Musk had little patience for newspaper-business executives, calling them dinosaurs and idiots.

“From the beginning, he never thought he had anything to learn from us,” said Ms. Yates, a former Knight Ridder executive who worked with Mr. Musk at the time.

Zip2 was bought in 1999 for $300 million, giving him the first money to invest in what would become a business empire years later. But Mr. Musk always had big ambitions for Zip2 and thought it could be worth much more, according to those former colleagues. As investors poured money into dot-coms.

“We looked at the newspapers,” Musk told reporters a few years later. “There were investors, customers, and they were on board — and they basically forced Zip 2 into a position of compliance.”

Twitter may try a second time.

Write to Tim Higgins at tim.higgins@wsj.com