Elon Musk believes that at least 10% of Twitter’s average daily users are not real accounts
Musk believes that at least 10% of Twitter’s daily active users (DAU) who see ads are not authentic. Furthermore, in his counter-indictment, Musk alleges that of the 229 million daily active users on Twitter, 65 million or 28% do not see ads. To get a more accurate indication of the number of fake accounts on Twitter, Musk used Botometer, a tool created by Indiana University that measures inauthentic accounts. Using this tool, Elon’s team found more fake accounts than Twitter disclosed, according to court records.
Twitter and Musk will fight in court in October
With a lawsuit commencing in October, Musk’s lawyers wrote in a document submitted to the court: “Twitter miscounted the number of fake and spam accounts on its platform as part of its plan to mislead investors. Twitter’s revelations have slowly unraveled, with Twitter frantically closing its gates to information in a desperate attempt to prevent the Musk parties from exposing its fraud.”
In his lawsuit, Musk alleges that Twitter linked accounts are counting double. The multi-billionaire claims that Twitter had inflated the revenue of daily active users by as many as 1.9 million people in its SEC filings every quarter.
Tinted with sarcasm, Twitter’s response was filed in court and it read: “According to Musk, he – the billionaire founder of multiple companies advised by Wall Street bankers and lawyers – was tricked by Twitter into entering into a $500 merger deal. 44 billion to sign.” Twitter added: “That story is as improbable and factual as it sounds.”
Twitter CEO Bret Taylor said of Musk: “His claims are factually false, legally inadequate and commercially irrelevant.” And as for the Botometer tool, Twitter called it unreliable, pointing out that it once called Mr Musk’s own Twitter account “very likely a bot.” In his lawsuit, Twitter said, “Musk is refusing to honor his obligations to Twitter and its shareholders because the deal he signed no longer serves his personal interests.”
A clause in the contract could allow Musk to pay $1 billion to end the deal if his financing falls through
A “specific performance” clause included in the contract allows Twitter to sue to close the deal as long as Musk’s funding remains in place. But if funding for the deal falls through, Musk could pay $1 billion to end his obligations to buy Twitter.
Tweet posted by Musk today gives some hope the deal can be finalized
Although Musk is a multi-billionaire, much of his wealth is tied up in Tesla stock. Musk planned to borrow against the value of some of his Tesla shares to raise as much as $12.5 billion. A dangerous financial maneuver, if Tesla shares had fallen sharply, Musk could have been forced to pay extra money with a margin call, or have sold the Tesla shares as collateral for the loan from under him.