Elon Musk has owned Twitter for less than a week and it is already clear that the world’s richest man has no firm idea of what he wants to do with his $44bn folly. The easy bit was firing a few top executives, including the chief executive and the person in charge of content moderation. The rest is a muddle.
Musk has been combining platitudes (Twitter should be “warm and welcoming to all”) with sketchy thoughts on future revolutions. Split the site into strands to allow consenting adults to indulge in spats? Charge users $20 a month to have a “blue tick” verified account? Bring back Vine, a video-sharing app closed by Twitter in 2016? All have been floated as possibilities, but none is yet a policy. It all smacks of an attention-seeking exercise rather than a strategy.
Musk has, though, shown a dawning awareness that shouting about free speech absolutism from the wings is easier than constructing workable policies from the inside. Thus the announcement of a “content moderation council”, seemingly to appease advertisers. There are, though, no details on how such a council would work or how its members would be appointed. Would it, for example, have the power to ban the boss himself for retweeting baseless conspiracy theories about Paul Pelosi?
One could take the view that a freewheeling approach is simply how Musk rolls. He takes punts, backs hunches and isn’t afraid to change his mind. But shareholders in Tesla – a far bigger and more important company – must look upon this vainglorious adventure in horror.
For better or worse (and almost certainly the latter), Musk now embodies the Twitter brand, just as he does Tesla’s, and there will be spillover effects. He is also obsessed with a time-consuming and politically charged hobby that he doesn’t know how to manage. There are no upsides for shareholders in the car company.
Stakes high for Royal Mail
The government is relaxed about Daniel Křetínský, the “Czech Sphinx”, taking his stake in the owner of Royal Mail above 25%. That is the finding of the review under the National Security and Investment Act ordered by Kwasi Kwarteng in those faraway days (actually only two months ago) when he was business secretary.
While a thumbs-up for 25% does not mean ministers would automatically authorise a full takeover, no obstacles have currently been thrown in Křetínský’s path. The next stop – the one short of a mandatory bid – would be 29.9%. Shares in IDS rose by 4%.
Křetínský, though, would surely be foolish to attempt an opportunistic bid in the current climate. Royal Mail is in the midst of a dispute with the Communications Workers Union over pay and conditions and a few days of talks at Acas, the conciliation service, have only emphasised the chasm between the two sides.
A new Royal Mail two-year pay offer on Monday of 7%, conditional on charges in working practices, was denounced by the union as “derisory” and a “declaration of war on your postie”. A takeover bid at this point would make resolution even harder. Křetínský did not earn his nickname by seeking the limelight.
But he is the figure to watch in this saga. One assumes he is already holding management’s feet to the fire in enforcing a “no cross-subsidy” rule between GLS, the profitable international parcels operation run from Amsterdam, and the loss-making UK postal service. And it is also reasonable to think the major shareholder is gung-ho for a full break-up – in other words, the full separation already promised-cum-threatened by the IDS board.
Since Royal Mail’s position as a standalone company would not, to put it mildly, be strong, the UK government’s current reluctance to intervene on ownership is a possibly significant event. Křetínský will be delighted, but a deal on pay and modernisation still looks miles away.
Diamonds in the Rough?
Near-term European gas prices have plunged amid mild weather, but next year’s remain high. That combination is almost perfect for anybody with a large gas storage facility – fill the thing now, and lock in gains for future delivery.
Centrica’s timing in reopening its offshore Rough facility was excellent, in other words. Analysts at Investec reckon the current daily rate of injection of supplies into Rough could be worth £5m a day. The shame, though, is that the reopened project will only be operating at 20% of its former capacity this winter. With more foresight a few years ago, Rough could have been a very big deal today.
