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Elon Musk’s conflict with Apple increases Twitter’s vulnerability.

2022/11/30 (Nov 30th, 2022 9:10 am)
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Elon Musk’s most recent controversy with Apple Inc. is a risky move that might backfire and put Twitter even more in danger of collapsing.

In a series of tweets on Monday, Musk claimed that the most valuable company in the world had “threatened to withhold Twitter from the App Store.” Musk continued, “They won’t tell me why,” and mentioned that Apple AAPL, -2.11% has largely stopped using Twitter for advertising.

Additionally, he tweeted that Apple receives a 30% cut of all sales made through its App Store, calling it a “secret tax.” Many debates have centered on Apple’s exorbitant App Store fees, most recently the lawsuit from Epic Games Inc. that has just been heard in a San Francisco appeals court.

In response, some of Musk’s 119.5 million Twitter followers speculated that it was because Apple supported the Democratic Party and was politically biased, while others asserted that it was because of concerns about hate speech and content moderation.

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According to Joshua White, an assistant professor of finance at the Owen Graduate School of Management at Vanderbilt University, Musk is “playing with fire” by taking on Apple.
However, it appears that Musk is also attempting to persuade Apple CEO Tim Cook to reduce Twitter’s App Store costs in order to change Twitter’s primary revenue stream from advertising sales to a subscription model. The New York Times estimates that Musk’s deal to buy Twitter and take it private has left the company with a massive debt burden of about $13 billion, which is far more than Twitter’s current free cash flow.

Eric Talley, the Isidor & Seville Sulzbacher Professor of Law at Columbia Law School, described the man’s debt as a “ticking time bomb.”
White said, “Musk is also strategic; when you see these seemingly irrational things, there has to be a reason for it.

Given that the majority of Twitter users tweet from their iPhones, he said, “Apple might figure out a way to keep Twitter on board, or allow Musk to extract something.”
It is extremely uncertain whether Musk will prevail in a conflict with the organization that controls many of Twitter’s users, but it is obvious that he believes the time is right to launch the first attack.

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