#191 #TwitterMustDie?

Global Policy Watch: Tu Cheez Badi Hai Musk, Musk (umm, sorry) Insights on global policy issues — RSJ One of the great problems of policy, or even philosophy, is who should own things that are or that behave like public utilities. For instance, who should own news broadcasting services? Suppose you prepare a case study explaining what’s news broadcasting, the perils that someone abuses such a service to spread fake news and propaganda, and the damage they do to society. Now hand over this case to a bunch of well-meaning people and ask them: how would they frame a policy on ownership of such a service? What do you think the answer will be? I don’t have any empirical evidence to back this, but I think in most scenarios, you will find a group of well-meaning people supporting some kind of ownership by the state or a distributed set of individuals. They might suggest a set of tightly regulated norms on what should be broadcast, and they could also throw in a stringent penalty regime for violations. It is unlikely that any group will come up with the answer that it should be owned by a megalomaniac rich man who believes in free speech, flips the bird to regulators on most occasions and has a penchant for poop emojis. A public utility cannot be left to such unstable people regardless of their genius, is what most would say. Twitter is the equivalent of a global public square where news stories are broken, and opinions and trends are generated. Should it be owned widely by the public with a governing board that regulates the platform, its content and its algorithm? Or should it be owned by the state, which can run it like a public utility without a profit motive? Or should Elon Musk own it? What do you think? Twitter Is Different Before I venture to write about the options, it will be useful to lay out the unique character of Twitter as a platform. During the week, I reached out to Amit Varma (doesn’t need an introduction to readers here), who always has a clear-eyed view of things, to understand what he makes of the happenings at Twitter. His views helped me articulate my thoughts better. Read his insightful piece on Twitter here. First, unlike broadcasting services of the past, Twitter is exceptionally quick because it is a hyperconnected network of people. Events unfold in real-time on it, and trends catch on fast. Mobilisation on Twitter is faster than the speed of response of any state. It plays an outsized role in shaping the discourse because speed is a feature in today’s age. Two, the incentive architecture of Twitter is designed to reward extreme positions. The ‘retweet’ or ‘quote’ button, the notion of having ‘followers’ and the constraint of the 280 characters all mean there’s more purchase for broad generalisations, provocative positions and performative behaviour to pander to your own tribe. Three, Twitter is a monopoly in a very unique sense. Granted, there are other platforms that take a share of our attention, but there’s only one platform that richly rewards us for our attention with the dopamine hit in the manner Twitter does. Social media platforms tend to be ‘winner takes all’ plays because, as a user, once you build a certain kind of network and reach that’s unique to that platform, there’s little incentive to start building it all over again for the same benefits in another. The switching costs are just too high. #OwningTwitter Think of these features of a broadcasting service together - hyperconnected and quick, rewarding fringe behaviour and a natural monopoly. How should we think about its ownership? Now look at the three options of its ownership - a) the state (or a group of states), b) a widely-held listed public company or c) a Musk-like figure. One way to think through this is to understand the natural incentives of these respective owners, how they will use the platform to achieve those and what will be the net societal outcomes of those actions. Take the state first. All good intentions aside, as we have demonstrated over and over again on these pages, the primary incentive of the state is to perpetuate itself. Or, the party that runs the state to continue being in power forever. While to many in India who are brought up to think of the state as the mai-baap, it seems like a fair arbiter of how a public utility should be managed, the evidence all around us should go against that intuition. A public utility like Twitter controlled by a state that’s benign and fair can be a tremendous aid for the welfare of the community. But in public policy, you must consider the ‘corner cases’. You must ask, what if a utility like Twitter is in the hands of the politician you dislike the most? Will they be fair and benign? And then think about ownership and governance of such a utility and its consequences. So, the argument that a global public square like Twitter should be owned by a state or a group of states and managed like a global public good appears pious and workable on paper but is fraught with the risk of a bad faith actor with sovereign power taking it over. That will mean only one kind of fringe taking over. Bad things will follow. Next, let’s consider the ownership by a publicly held company which is how Twitter used to be till Musk bought it out. The management of such a company is the shareholders' agent, and its incentives are aligned with what’s best for the shareholders. The management, therefore, works to maximise shareholder returns which get tracked every quarter based on the company's performance. Regardless of how visionary the management team is, they are toast if they do not deliver every quarter. There’s no avoiding short-termism here. What’s the incentive for any manager to fundamentally retool this company, take short-term hits for many quarters and live in the hope that the strategy will pay off in the long term? Nada. Shunya. Nobody has seen the long-term, and the shareholders have other places to invest than to wait for so long. Twitter has dug itself into a hole where outrage and fringe positions bring in engagement, and that engagement is monetised for advertisers. Even if you had an enlightened management team that knew the damage this ad-dependent business model was doing to society, it would find it impossible to junk the model and change the engines mid-air, so to speak. Because any change in course will need to be dramatic, meaning significant short-term pain. That would understandably test the time and patience of the shareholders. You would need a Steve Jobs-like reality-distortion capability to convince them otherwise. There aren’t many Steve Jobs around to run a public company as professional CEOs. The best that Twitter, in its public company avatar, could do is to be managed efficiently. That’s it. That efficiency on its current model however would mean it would only get better in coarsening our discourse and widening cultural chasms. I think this is what is called irony. Lastly, let’s consider the option of a Musk-like figure buying out Twitter and doing what he pleases with it. What happens here? While it was somewhat easier to appreciate the incentives that drive the state or the shareholders of a public company, we can only speculate on Musk’s incentives. There’s no academic research done (yet) on Musk’s behaviour and actions. So, we can only think in terms of scenarios here. Scenario 1 is what I call the ‘Matt Levine view of Musk’. Levine is a modern-day Plato. The most lucid interpreter of capital and economy in the world today. His newsletter is quite simply the best chronicle of our times. And it’s free. What a legend! He has built a theory of Musk’s purchase of Twitter in many delightful editions. In this theory, to Musk, Twitter is a video game he loves. Ordinary people, like you and me, play a game, get addicted to it and then, over a period of time, get bored with it. We start hating a feature, or a new upgrade isn’t to our liking, or we see too many people playing it. Whatever. We move o… This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit publicpolicy.substack.com