Twitter’s acquisition for $44 billion cannot move forward, at least until the social media company can properly provide proof of its claim that fake or spam accounts comprise less than 5% of its users.
In a filing with the SEC, Twitter noted that its bot estimate came from an internal review of a sample of accounts. Twitter noted in its filing that it “applied significant judgment” when it conducted its evaluation. Elon Musk later revealed that Twitter only used a sample of 100 accounts in its calculations.
Musk’s doubts about Twitter’s estimates have encouraged other entities to try and determine the number of fake accounts on the social media platform. One of these is SparkToro co-founder Rand Fishkin, whose analysis involved over 44,000 public Twitter accounts. Fishkin’s firm estimated that 19.42% of Twitter users are likely spam or fake.
Musk cited similar figures during a Miami tech conference yesterday. During the presentation, the Tesla CEO stated that bots could make up at least 20% of Twitter’s users. With this in mind, his $44 billion offer for the social media company may need to be adjusted.
In a Twitter post, Musk noted that his offer to acquire the social media platform for $54.20 per share was based on the idea that the company’s SEC filings were accurate. But since this may not be the case, things may need to be changed.
“20% fake/spam accounts, while 4 times what Twitter claims, could be *much* higher. My offer was based on Twitter’s SEC filings being accurate. Yesterday, Twitter’s CEO publicly refused to show proof of <5%. This deal cannot move forward until he does,” Musk wrote.
In a statement to Bloomberg, Twitter noted that it is “committed to completing the transaction on the agreed price and terms as promptly as possible.” For this to happen, however, the social media company would have to be extremely transparent about its bot users—regardless of how painful it may be.