?? Elon and Twitter | Facebook's Faulty AI | UK's Crypto Ambitions, plus more
This week: I'm making sense of the news about Elon buying into Twitter, when Facebook's algorithms went out of control, and the UK's plans to be a global crypto hub. Plus lots of other stuff.
Wiser! is a free-to-read weekly newsletter for the tech economy. Every week I try to make sense of what's happening and what's next (so that you don't have to). From the Strategies of BigTech to the Impact of Social Media, from Crypto to the Metaverse. I condense the big stories into meaningful insights.
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w/SocialMedia
1?? Musk Becomes Largest Individual Shareholder In Twitter
The only thing that you can be certain of is that this is going to be a crazy ride!
Elon Musk is considered to be the world's richest man, thanks to his enormous, and arguably overinflated shareholdings in Tesla, SpaceX and The Boring Company.
This week, he added another big chunk to his paper wealth after it was made public that he'd spent around $2.4 billion on a 9.2% stake in Twitter. Musk is now the company's largest individual shareholder.
As the news broke, Twitter's share price popped and Elon profited (again). A guy who has a record of profiting from manipulating markets with his Tweets was at it again. Something that has gotten him into hot water with the SEC before, and is certain to do so again.
As the news of Elon's Twitter stock purchase broke, $13 billion of Twitter stock exchanged hands. The highest daily volume ever for the underperforming social media platform.
There's a ton to unravel in this story.
Is this about free speech??
Probably. Elon is a free speech absolutionist. He ran a Twitter poll 2 weeks ago that polled 2 million votes. The result: 70% responded that Twitter does not rigorously adhere to the principles of free speech.
The big question is whether Elon will persuade Twitter to reinstate Donald Trump, who was permanently banned following the Jan 6th insurrection.
Is he in trouble with the SEC??
Yes, not for the first time. Remember in 2018 when he tweeted that he was taking Tesla private? The SEC fined him and Tesla $20 million each. Elon is still required to have his tweets pre-approve by a lawyer. The case is before a judge as we speak.
Back to Twitter. Elon is in trouble because he broke basic trading rules. He had been buying up Twitter stock since late January. On March 14th, he crossed the 5% barrier, meaning he was legally required to tell the markets he owned 5% of Twitter.
But he didnt do that, until last week.
Which meant that every shareholder that sold Twitter stock at around $38/39 between March 24th and the news breaking, sold without the knowledge that Elon Musk was buying up Twitter
To make it worse, when Elon finally submitted his paperwork, he said he was a passive investor. Meaning he would take no active role in the direction of the company.
But then Jack Dorsey and current CEO, Parag Agrawal started tweeting that they'd been in conversation with Elon for weeks. Followed by Agrawal announcing Elon as a board member and, bingo, Elon isn't so passive anymore.
The big question: does the SEC have the stomach to take on Elon? They've been pretty spineless up until now ($20 million is a parking ticket to Elon).
IMHO, the SEC HAVE NO CHOICE. Let's see...
What is Elon likely to do with Twitter??
Quite a bit. It's unlikely that he'll sit quietly at the back of the boardroom. Within hours of going public, he started a Twitter debate amongst his 80 million followers about an "edit" button.
He's a crypto aficionado. You'd bet on him advocating digital tokens, more use of NFTs and even payments with crypto via Twitter.
Getting rid of the spam bots that have overtaken Twitter. You only have to look at Elon's own feed and you see thousands of fake, machine generated tweets and crypto promotions. The problem is that (a) its not real and (b) it inflates the actual engagement numbers on Twitter (which devalues the advertising spend of brands on the platform).
Is Musk the kick-start that Twitter needs??
That's the $2.4 billion question. It's going to be fun finding out!
There's no question that Twitter needs to do something. It's a big brand for what is a relatively small company. But it has failed to make any inroads on Facebook or Google's dominance of social media or the digital advertising market.
When the news broke that Elon had bought 9% of Twitter, the stock jumped 30%. But then it stalled and has eased back...on news that Elon is going on the board.
In other words, the market LIKED the idea that Elon was investing. But isn't so keen on the idea that he's going to dominate it's direction. Afterall, it's not like he's bought all of Twitter (and he's restricted to only ever owning 15%).
The big question: will he get bored, or frustrated, or both?
You can read more on this topic here. It's free to read and remember to post your comments at the bottom of the page.
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w/Promotion
Typefully is a must-have for Twitter creators who are serious about crafting quality content and engaging their audiences meaningfully.
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w/AI
2?? Facebook Knew It Was Promoting Fake News, But Couldn't Stop It
Facebook has revealed that they spotted a fault in their algorithms last October. The AI that decides what posts go into a user's News Feed was doing the opposite of what was intended. The feature, called down-ranking, was meant to suppress the posts of known misinformed.
Instead, according to Facebook engineers, it was boosting them by up to 30%!
Worse, it took the Facebook engineers 6 months to work out why the artificial intelligence was going wrong before they could fix it.
So What?:??Here's why this story is important. Facebook's algorithms control everything you see. But you don't know how those algorithms make those decisions, do you?
Talk to most Facebook users and they'll say things like, "Facebook doesn't influence me", or "I can spot fake news a mile off", or "I only look at posts from genuine people". Or any variation of the theme.?
The point is that they're mistaken.
According to the?latest data from Ofcom, "1 in 3 Internet users fail to question misinformation."
Tests reveal that both adults and children "overestimate their ability" to spot fake news.
Although around 7 in 10 adults believe they can't be fooled by fake news, when put to the test, only 2 in 10 were able to spot the tell-tale signs of misinformation.
Similarly, around a quarter of all users who said they could not be fooled were unable to identify fake profiles when presented with them.
领英推荐
"1 in 20 Internet users believe everything they see online."?Ofcom, March 2022
Here's the thing:??Putting to one side a user's (in)ability to smell a fake post from 30 paces, most users think that they are deciding what to read and what to ignore. But they can only do that based on what is put before them. Users don't decide what goes into their News Feed, Facebook's AI does.
And it's the Facebook algorithms that decide what is put before them.
This is why this story about Facebook taking 6 months to work out how to stop its own algorithms from doing what they were not supposed to be doing, is important.
w/Crypto
3?? UK Wants To Be A Global Crypto Hub
The UK Gov has announced plans to?"become a global hub for digital assets". The government is now looking at?“regulating a broader set of crypto activities including the trading of tokens like bitcoin."
The plans include;
Following the lead from the USA and the European Union, the UK has joined the party when it comes to "thinking" about crypto regulations. It's a necessary next step for a market that now has over 300 million crypto owners and a market cap of around $2 trillion (which is the size of the Italian or Brazilian economies).
It's about time.
This is reminiscent of the early days of the internet when there was a lot of promise of a better future, a small but growing user base and no rules of engagement. This applies as much to crypto now as it did to the internet in the early years.
In the 1990s the Internet was primarily about e-commerce. The likes of Amazon, LastMinute.com and eBay started trading online. This created new legal and regulatory issues that nobody fully understood.
It was also a time when there were lots of naysayers. It’s hard to imagine now, but there were many who said it would never take off. Or should be stopped altogether (mainly because they feared the competitive threat that came from Internet-based services).
I don't see it as much different today. Like deja vue all over again when it comes to crypto and digital currencies.
Third-Party Apps Are More Popular Than Apple's Own Apps
A new report, financially supported by Apple, reports that users are turning to non-Apple apps on their Apple devices. For example, the researchers found that Spotify is used 50% more than Apple Music with iPhone users. Cynically, it looks like an attempt by Apple to show the anti-trust regulators that they are facing competition. It's not likely to cut it.?Source:?The Information
Russians are using their phones very differently than they did before the war
With 504 news sites, 140 financial sites, and three social media sites?blocked?by the Russian government since the invasion of Ukraine began, Russians are resorting to virtual private networks (VPNs) to disguise their location and connect to the public internet.?Source:?Morning Brew
Bitcoin to be accepted by McDonald’s and Walmart
This is because of a thing called the Lightning Network. It's is a layer two solution for the Bitcoin blockchain that uses smart contracts to settle payments instantly with near-zero fees. In other words, it enables people to use Bitcoin as a digital currency, not just as digital gold. In theory, the Lightning Network lets Bitcoin scale and compete with every other currency on the planet.?Source:?CryptoSlate
Uber Wants To Turn Itself Into A SuperApp
Uber plans to emulate China's "superapps". Uber already has the pieces in play. They have a global brand, a ubiquitous app and, most importantly, a payments engine. This is the key, payments. The unlocking of WeChat from a messaging app to a superapp came when China deregulated financial services and let the equivalent of Facebook and Amazon have banking licences. Expect to see Uber add train, bus and plane tickets, car rentals and hotels to the Uber app.?Source:?CNBC
Spain to Invest in Chipmaking
As part of a strategic overhaul of the Spanish economy (into a digital one), President Sanchez has announced an ambitious €11 billion investment to develop a national microchip and semi-conductor capability.?Source:?Bloomberg
Almost Half of All Crypto Owners Bought for the 1st Time in 2021
A survey by Crypto exchange Gemini reported that Brazil and Indonesia lead the world in global crypto adoption. 41% of people surveyed in those countries reported owning crypto, compared with 20% in the United States and 18% in the United Kingdom. They also found that 79% of people who owned crypto chose to purchase the digital assets for their long-term investment potential.?Source:?Reuters
Did You Know???Microsoft and its browser archrival Netscape share the same birthday? Microsoft was formed on April 4, 1975, while Netscape was founded April 4, 1994.
Create AI Art For Fun
Here's a bit of fun to waste some time. Create your own digital art using AI. Tell the AI what you want, pick the style of artwork and hit go. Within seconds, an AI algorithm will have generated a unique piece of "art". To be frank, every pic it did for me was rubbish, but it was amusing until the novelty wore off.?Source:?Wombo
Global Market Size for AR/VR/Mixed Reality
7 billion voice messages are sent every day on WhatsApp
That's 1 voicemail a day for 7 out of every 8 people on the planet.?Source:?WhatsApp
A third of parents of 5-7-year-olds said they have a social media profile
For 8-11-year-olds this is as high as 60%. Interesting when I remind you that the minimum age requirement for most social media sites is 13!?Source:?Ofcom
Apple now has 1.8 billion active devices
And Google has over 3 billion active devices on Android.?Source:?The Verge
Amazon is the biggest clothing retailer in the US
Having overtaken Walmart in 2020, Amazon’s sales represent 11-12% of the total US market and around 35% of all online sales. Well Fargo estimate that Amazon’s sales will grow another $4 billion this year to top $45 billion.?Source:?Retail Week
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