- In a new interview, Jack Dorsey explained Elon Musk's seemingly chaotic decisions at Company X.
- Dorsey said mass layoffs, an exodus of advertisers and a revamp of blue checks are compatible with promoting free speech.
- It's all part of abandoning Twitter's “core cardinal sin” of controlling advertisers, he said.
Elon Musk's response to Twitter has been criticized as erratic. But Jack Dorsey, the platform's co-founder, said Musk's deep layoffs and cutbacks made sense for a move toward free speech, and that his fellow billionaires defends the approach.
Dorsey spoke with Mike Solana, head of marketing at venture capital firm Founders Fund and editor of digital media brand Pirate Wires, in an interview published Thursday. Mr. Dorsey said he shares Mr. Musk's goal of building an internet bulwark for free speech. But Dorsey said Twitter is being squeezed by its revenue model.
Twitter has chosen brand advertising as its main source of revenue, saying the platform's moderation is a “core cardinal sin” that leaves it exposed to the whims of the companies that effectively fund social media platforms. Dorsey said.
“And when you're completely dependent on it, what if a brand like P&G or Unilever doesn't like what's happening on the platform and threatens to pull their budget, which accounts for like 20% of their revenue? You don't have a choice. There’s no room,” Dorsey told Solana.
Musk, who rebranded Twitter as X, appeared to endorse anti-Semitic posts in late 2023, sparking an exodus of advertisers. It was a turning point for many organizations after months of controversial and confusing comments from Musk.
The owners of Tesla and SpaceX seem unfazed by major companies like Disney, IBM, and Apple pulling off their platforms, publicly telling advertisers to “fuck you” and labeling them as “free speech leaders”. 'oppressor'.
Experts were shocked. But Dorsey said Musk made the right choice to stick to his vision of a censorship-free “digital town square” and reduce the focus on advertisers.
“For that model to work, you need to build a lot more than advertising. You need to build subscriptions, and that's what Elon is doing. You need to build commerce.” Dorsey said.
This solves another pain point for older Twitter fans. Shortly after the acquisition, Musk revamped the subscription service by offering Blue Check certification to paying users and aggressively promoting monthly memberships.
Building a different business model than before
To many, it appeared that Musk was trying to abolish Twitter's entire business model. But Mr. Dorsey said the latest hemorrhage is part of finding new sources of revenue as he moves away from the control of big advertisers.
“Twitter was a $5 billion a year business,” Dorsey said. “I don't know what it's like now, but it's obviously not close to that, right? These are options, but that doesn't mean it's going to stay at the same level of business for quite some time. You. will find a completely different model around it.”
The mass layoffs at Twitter, where Mr. Musk cut its global workforce by 80%, also made sense to Mr. Dorsey, as the majority of employees are in sales.
Dorsey's comments came as he left Bluesky, the platform he helped build after leaving Twitter, and told users to use Musk's X instead.
He then trashed his entire Twitter following list, except for Musk, Edward Snowden, and WikiLeaks founder Julian Assange's wife.
Co-founder of Twitter generally speaks positively of MuskHowever, he has previously said he felt Musk lacked tact in dealing with major changes at Company X, including messy and sudden firings that led to lawsuits from former employees.
“The whole thing seemed pretty reckless,” Dorsey said of Musk's move in June.
Musk bought Twitter for $44 billion in October 2022 and took the company private. Less than six months after imposing major changes, he reportedly said it was worth less than half the purchase price.