Early on Friday, Elon Musk announced that he plans to put his deal to buy Twitter “temporarily on hold” following the release of a report detailing the number of “fake” accounts on the platform.
Last month, Twitter accepted Musk’s offer to buy the company for roughly $44 billion. The move was met with criticism and concern from many, but also praise from “free speech absolutist” types. On Friday, Musk tweeted out a link to a Reuters report on “fake” accounts or spam bots on Twitter, and indicated that he requires more data before the deal goes through.
“Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users," wrote Musk. "Still committed to acquisition."
The Associated Press reports that Twitter stock fell as much as 14 percent following Musk’s tweet on Friday, while shares of Tesla jumped 7 percent. Upon announcing his deal last month, Musk said one of his key goals for Twitter is to remove “spam bots” and “authenticate all humans” on the platform. He’s also said that he’s contemplated monetizing tweets, requiring websites to pay a fee to quote or embed tweets from verified accounts.
The possible monetization of Twitter could be a big reason why Musk requires more data, as he’ll need to know the exact amount of active users on the platform in order to forecast profits, and specify how many users to gear advertising toward. The filing from Twitter, referenced in the Reuters report, made it clear the “5 percent” figure is an estimate based on an internal review.
“In making this determination, we applied significant judgment, so our estimation of false or spam accounts may not accurately represent the actual number of such accounts, and the actual number of false or spam accounts could be higher than we have estimated," reads the filing.
It is unclear when Musk plans to let the deal proceed.