Twitter, Elon Musk, and what it all means for the sports industry

Even by the technology industry’s standards, the pace of change at Twitter has been extraordinary since Elon Musk’s US$44 billion takeover last October.

There have been debates about the future direction of the company and free speech, mass layoffs and resignations, and an overwhelming sense of unpredictability as Musk attempts to reform the company.

Sport has been a major source of activity on Twitter for more than a decade. Fans flock to it for the latest news and discussion on major events, while broadcasters, rights holders and brands use the social network to drive engagement and revenue. The social media site has also provided athletes with a more direct route to fans and provided a platform for content creators and influencers.

Simply put, Twitter is now an integral part of the sports industry landscape and the changes will have ramifications for everything from media strategies through to advertising.

Amid an ever-changing situation, SportsPro attempts to distil the past three months and look at where sport’s relationship with Twitter is going next.

Twitter is a key engagement tool for the sports industry 

Why did Elon Musk buy Twitter?

Musk, who is also the founder and chief executive of electric vehicle (EV) manufacturer Tesla and satellite connectivity firm SpaceX, is also a prominent Twitter user who was believed to be disgruntled with the company’s direction. Publicly, he said it is because he’s a ‘free speech absolutist’ and believed he could unlock its full potential – possibly as part of an ‘everything app’ that wouldn’t just be a social network, but provide a range of services.

The process started in April when he revealed he had purchased nine per cent of the company, a development which led to him being offered a seat on Twitter’s board of directors.

Musk elected not to take the seat and Twitter started making defensive moves to guard against a hostile takeover. Eventually, Musk made a US$44 billion offer – a price that was well above what the company was valued at the time. Some speculated that the offer of US$54.20 a share was partly motivated by the desire to include ‘420’ – a reference to cannabis – although Musk has denied this.

Twitter’s board accepted the offer, concluding it was too good to refuse for a company that has hitherto struggled to effectively monetise its user base and vast influence. Musk then tried to back out of the deal, arguing there were too many bot and spam accounts, leading to Twitter taking legal action.

As it appeared increasingly likely that he would lose in court, Musk opted to continue with a combination of his own money and loans. By the end of October, Musk assumed full control.

What has Musk done since taking over?

It’s been difficult to keep up since Musk first walked through the front door with a literal sink in his hands.

The most obvious impact has been on the workforce. There have been mass layoffs and resignations affecting everything from development and cybersecurity through to content moderation and communication.

Musk believes Twitter can be run much more efficiently with a smaller workforce. He has also fired staff for publicly criticising him or the company’s new direction, decreed an end to flexible working apart from in exceptional circumstances, and demanded that all staff commit to being ‘hardcore’, implying a doubling of efforts and longer working hours. Musk argues these changes are necessary for Twitter to avoid bankruptcy and fulfil its potential, but others fear the firm now lacks the resources to maintain, secure, and develop its platform.

Musk has also revoked bans for users who were previously barred for violating its terms of service, most notably Donald Trump. But the most obvious change has been the overhaul of the verification system.

Originally, verification was designed to help brands, public figures, and organisations prove their identity, making Twitter a more useful platform and fostering trust among users. However, many users have interpreted the ‘blue tick’ that comes with verification as a symbol of desirable status.

Musk opted to integrate the blue tick as part of a revamped ‘Twitter Blue’ subscription service costing US$11 a month, which included additional capabilities such as a long-requested ‘edit’ button.  

In the early days of Twitter Blue, anyone with US$8 to spare could pretend to be a real company or person complete with a blue tick. This made it difficult to distinguish real users from imposters or parody accounts.

Users impersonated famous athletes like LeBron James and widely followed National Football League (NFL) reporters such as Adam Schefter, opening the door for misinformation and fraud. It was difficult to trust anything on the platform, negating the value of Twitter.

Since the launch of Blue, Twitter has taken steps to distinguish public figures and organisations from Twitter Blue subscribers, but others have expressed concerns that resignations and layoffs have hindered the company’s ability to moderate fraudulent, abusive, and illegal content. This lack of oversight, combined with a commitment to free speech, has increased the volume of hate speech on the platform. 

Other changes include the algorithmically determined ‘For You’ feed taking precedence over the traditional chronological timeline, adverts appearing more regularly, and what seems to be a suspension of the platform’s application programming interface (API), a move which is affecting third-party readers. Musk has also debated policy in public polls, including his future as chief executive.

How important is Twitter to the sports industry?

Twitter has become home to many communities, but sport is one of the most high profile. The platform’s emergence in the late 2000s coincided with the mass adoption of social media and the smartphone, and offered fans, athletes, rights holders, broadcasters and advertisers the opportunity for a more direct form of communication.

The platform has evolved significantly since then, and so has how the sports industry uses it. It’s a place for debate, breaking news, video highlights, fan engagement and marketing. Organisations have entire social media teams dedicated to the platform, tweets are a critical part of broadcasts, and sometimes Twitter becomes the story itself.

TikTok, Instagram and Twitch might now be the place where sports influencers are born, but Twitter was perhaps the first platform in which it was possible to go truly viral. Athletes, sports and individuals were able to find an audience they wouldn’t otherwise previously have found.

Twitter might not have the largest following of any social network, but it is by and far the most influential.

The recent Fifa World Cup was a major source of traffic for Twitter 

What do the changes at Twitter mean for the sports industry?

To most observers, nothing has changed. Broadcasters are still putting out highlights, fans are getting involved in the conversation, and journalists are still reporting news. The recent Fifa World Cup was a major event for the platform, driving significant engagement. In total, there were 147 billion impressions of the #WC2022 conversation.

But trouble is bubbling underneath the surface. No one knows what’s going to happen from one day to the next and that is unnerving for advertisers at a time when Twitter is seeking to increase its commercial income. The uncertainty is one thing, but brands and rights holders are understandably wary of their messages appearing alongside objectionable content.

Twitter Blue was meant to represent a shift from advertising to subscription-based revenue. However, it has simply jeopardised a more lucrative source of revenue in favour of a more modest stream of income.

A report in The Information suggested that more than 500 advertisers have paused spending since Musk took over, with Twitter telling employees that daily revenues on 17^th January were 40 per cent lower than on the same day in 2022. The Super Bowl is usually a major event for Twitter, with brands eager to capitalise on activity, but one unnamed brand told AdAge that not even the promise of half-price ads encouraging it to repeat its usual six-figure spend.

Those who are still working on advertising or social campaigns have complained they don’t know who to speak to at the company and some have expressed concerns that there are no longer enough engineering resources to keep features up to date or fix bugs. At one point, Twitter’s automated copyright tools appeared to be no longer functional, opening the door to piracy.

Twitter has spent a lot of time trying to encourage the sports industry to be more active on its platform, building relationships and developing feature sets with it in mind. It’s unclear how or if the two will work together moving forward.

Despite all this, the platform remains hugely important for sport – although regaining the trust of larger advertisers might take a little longer.

“Larger players have set up their budget for the next six to nine months in the social ad spend space,” Ishveen Jolly, founder and chief executive of OpenSponsorship, tells SportsPro. “If Twitter is not in the plans, it will be difficult to shift a significant budget toward the platform. However, the smaller, more agile players may make a push to test the platform if it offers advantages in cost as it goes through the many changes under Elon Musk’s team.

“If things go well for the small agile brands, I believe we’ll see a shift toward the end of the year as larger brands strive to cash in on the success shown by smaller [companies].”

Larger players have set up their budget for the next six to nine months in the social ad spend space. If Twitter is not in the plans, it will be difficult to shift a significant budget toward the platform.

Ishveen Jolly, Founder and Chief Executive, OpenSponsorship

Is there an alternative to Twitter?

In the early days of Musk’s tenure, some users declared they would no longer be active on Twitter, either abandoning this form of social media entirely or seeking a near alternative. One of the most popular was decentralised social media platform Mastodon, but it was quickly apparent that it lacked the user experience, easy onboarding, and feature set to accommodate an easy transition.

The issue is there is no immediate alternative as the world of social media splinters into a series of niche or specialised platforms and communication becomes less public. Facebook is now Meta, with a focus on immersive experiences, while its core social network is increasingly organised around private groups.

TikTok and Instagram are better at engaging younger demographics, but are arguably more about consumption than creation, while WhatsApp groups are emerging as a significant channel in their own right.

Sports-specific social networks have been tried in the past and it’s unlikely we’ll see a revival of the concept in the near future. But a new wave of sports platforms that combine multiple services, such as video, news, betting and gaming, could be seen as an evolution of this trend.

But ultimately, the changes at Twitter are a reminder that rights holders should be wary of becoming too exposed to what they have very little control over. This can at least partly explain why so many are devoting significant resources to owned and operated channels that offer a deeper, more personalised experience with features inspired by social media.  

Mastodon is one of a handful of Twitter alternatives but sport is staying put for now

What are the positives of Musk’s takeover?

Twitter is the sports industry’s social network of choice. If the controversies and uncertainty turn out to be nothing more than teething problems, then there is every chance Musk could transform Twitter into something even better.

Under previous management, changes were slow and infrequent, and Twitter isn’t entirely unrecognisable from what it was a decade ago apart from the increased character limit of 280. Even the ability to add multiple forms of media into a single Tweet was only added just before Musk took over.

Former chief executive Jack Dorsey largely delegated control of the company to senior management and the company has so far failed to translate its vast influence into commercial success. Twitter was once an important source of traffic for publishers and other organisations, but now it’s more about passive engagement with fewer referrals.

Musk clearly believes he is the one who can make this work. He has spoken of transforming Twitter into ‘X’, an ‘everything’ app that offers multiple services. There are plans to reward content creators with programmes similar to those offered by YouTube or Twitch, and there are definitely power users and businesses who would pay for additional features. Bookmarks and end-to-end encryption in messaging are valuable new features for end users.  

Meanwhile, Twitter has always been constrained by cost. One of the reasons that popular short-form video platform Vine was shuttered was because of a lack of resource. Yet TikTok, YouTube and Instagram have all enjoyed success since with the exact same format. Perhaps with Musk at the helm, such vision won’t be sacrificed?

People are conflating Twitter the platform and Twitter the company … the platform is fundamentally unchanged

Lewis Wiltshire, Chief Executive, Seven League

What will happen next?

While advertisers might have stayed away, the sports industry has not.

Axios reports that almost all of the major US sports leagues plan to honour their content deals with Twitter in 2023, with huge activity planned for major events like the Super Bowl, college basketball’s March Madness, and the National Basketball Association (NBA) playoffs. For these properties, there is little financial downside to remaining on platform, which helps them monetise content through in-video advertising.

However, it is worth noting that some of these deals are multi-year arrangements signed before Musk’s takeover and there might be fewer joint announcements as seen in recent years. Publishers and broadcasters are also still active as they seek to attract new customers.

No one knows what will happen at Twitter. The company is reported to be leaking cash, it has lost a lot of talent, and regardless of the potential merits of its future direction, there is considerable collateral damage.

But the doomsday scenarios have not manifested. Twitter has not collapsed, users are still on the platform, and Musk is still at the helm. Despite everything, Twitter is as important as it ever was for the sports industry.

“People are conflating Twitter the platform and Twitter the company,” Lewis Wiltshire, chief executive of Seven League and a former head of sport and media partnerships at Twitter UK, tells SportsPro. “What’s happening at the company is upsetting for people whose roles have been affected…and it’s horrible to see. But the platform is fundamentally unchanged.”