The future of X

Months before Elon Musk made his $44 billion move into social media in 2022, he tweeted that "for Twitter to deserve public trust, it must be politically neutral". So much for that, said Siân Boyle in The Observer. The proliferation of "alt-right diatribe, hate speech and bots" on the renamed X led to mounting disquiet among users, which reached a climax after Donald Trump's election victory.

X's newest rival, Bluesky, gained one million new users over just 24 hours last week, taking its total to 16 million. That's small fry compared with Twitter's estimated 586 million monthly active users. But some wonder whether this week will go down as the beginning of the end for X. The platform has effectively become "Truth Social premium", declared one analyst. Indeed, there is speculation that a merger between X and Trump's platform could be in the works. If that happens, whose interests would take priority? In the ongoing balkanisation of social media, the former Twitter could "fade away" or morph into an authoritarian "political super-app masquerading as social media".

A merger between X and Truth Social would "make business sense for Trump, not X", said Prof Erik Nesbit in Fortune. The two companies "compete for users' time, advertisers' dollars, and dominance of the cultural conversation". X is "a global brand with users from every corner of the world". Meanwhile, Truth Social is a "regional player" dominated by Maga types, with less than 700,000 monthly users. X's revenues have fallen dramatically since Musk's acquisition two years ago, with some investor estimates suggesting its current valuation is less than $10 billion, said the Financial Times. Groups such as Disney, IBM and Apple left the platform last year, expressing concerns about stripped-back moderation. But there are signs that some corporate advertisers are "poised for a return" in order to "seek favour with the incoming administration". Trump's victory has "lent Musk new legitimacy, as well as power over brands in sectors that could face new regulatory curbs from Trump". "It is unclear how the election will affect the seven banks that have been saddled with roughly $13 billion debt tied to Musk's takeover."

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Given the emergence of Truth Social as a $6 billion "meme stock darling", Trump could decide its future lies beyond X. Shares soared again this week on news that Trump Media is in "advanced talks" to buy the crypto trading firm Bakkt, said Kevin Breuninger on CNBC. Trump is clearly determined to develop his own crypto and social media interests even as he heads for the White House. He might well conclude: who needs Musk?