Long stories short
- Former defence secretary Penny Mordaunt emerged as a frontrunner in the Conservative leadership race with six candidates left in the contest.
- President Biden began his tour of the Middle East by telling Israel he was prepared to use military force if needed to stop Iran’s nuclear programme.
- A hidden Van Gogh self-portrait was discovered behind an earlier painting in the collection of the National Galleries of Scotland.
Musk vs Twitter
In April, the world’s richest man launched a bid to buy one of the most influential social media platforms. Elon Musk, the chief executive of Tesla and SpaceX, said Twitter was crucial to the functioning of democracy, serving as a “de-facto town square”. And Twitter thought he was serious. Eighty-five days later, Musk wants to pull out of the deal, Twitter is suing the billionaire and poop emojis are being cited in legal filings.
By the numbers:
- 400 million: the number of users on the US-based social media platform.
- $44 billion (£37 billion): the value of Musk’s takeover bid.
- $32.65: Twitter’s current share price, down 40 per cent since the deal was announced.
What went wrong? At the heart of the issue is corporate transparency. Musk thinks there are more bots and spam accounts on Twitter than Twitter does. He noted back in April that “eliminating the spam and scam bots, and the bot armies” was a top priority. According to Twitter’s own calculations, bots – fake accounts that imitate how a real person uses the platform – make up less than 5 per cent of active daily users. Musk suspects that figure is much higher.
The problem is that Twitter can’t make that information public, and Musk didn’t read the special report on bots that Twitter sent him and never met with the team that does the measuring. When Twitter’s CEO Parag Agrawal posted that the process for estimating the number of spam accounts was “not possible externally”, Musk responded with a poop emoji.
Afterwards, he posed a valid question: how can advertisers trust they are getting value for money on Twitter, if the number of spam accounts is non-public information?
What does Musk want? One interpretation of events is that Musk is haggling. In the big tech bazaar, the original price of $54.20 per share looks pretty undesirable after the slump in Twitter’s valuation in recent months. The issue of fake accounts and bot farms has hurt Twitter’s image, the uncertainty around the deal has driven a lot of employees out, and Musk might be seeking a better price for a damaged business.
He might also genuinely want to walk away from the deal, using the bots as an excuse, in which case he’d likely have to pay a $1 billion break-up fee and an unspecified amount of climb-down fees to creditors and lawyers.
What next? In court papers filed in the US state of Delaware this week, Twitter’s fury is obvious. The company describes Musk as a “model of hypocrisy” who treated the transaction as an “elaborate joke”. The poop emoji is used as an example of his disparaging tweets against the company. Ultimately, it wants to force him to do the $44 billion deal and buy Twitter. His offer is on attractive terms and the company is bleeding staff and reputational value during this period of uncertainty. Experts say their case is strong; the court could reach a decision as early as mid-September.
Twitter has been left in disarray as employees complain of a lack of leadership within the company. One told Wired Twitter was a “shit show” internally. And Elon Musk continues to be Elon Musk. When the Twitter lawsuit was announced, he posted an image of Chuck Norris sitting at a chessboard with one pawn staring down a set of black pieces with the caption: “Chuckmate”.
CAPITAL ECONOMY, BUSINESS AND FINANCE
US inflation rose to a new four-decade high in June as prices rose for core products and services, from cars and clothing to furniture and rent. The government’s consumer price index rose 9.1 per cent, the fastest year-on-year jump since 1981, putting pressure on the Federal Reserve to raise interest rates aggressively in response. The US is not the only country struggling with high prices. Inflation in the euro area is expected to be 8.6 per cent in June and is partly to blame for the falling value of the single currency – the US dollar is now equal to the euro in value for the first time in two decades as investors worry about inflation, the war in Ukraine and the risk of recession. American tourists coming to Europe on holiday will be happy – but even they are facing a temporary reprieve.
TECHNOLOGY AI, SCIENCE AND NEW THINGS
Are you willing to pay less for Netflix in exchange for advertisements? The streaming company is hoping the answer is yes: it’s announced a partnership with Microsoft to build a new ad-supported model of its service. The new offering will be in addition to its existing plans, and the company hasn’t revealed how much it will cost viewers. Netflix first announced the switch to an advert strategy after a decade-long run of subscriber growth ended earlier this year, leading to a crash in value and hundreds of job cuts. It hopes the new, cheaper service can bring viewers back – particularly as competitors like Disney are heading in the same direction. Netflix never wanted ads – its chief executive described them as a form of viewer “exploitation” back in 2019 –but as customers look at ways to make savings amid a cost of living crisis, some rules will have to be broken.
The 100-year life health, education AND GOVERNMENT
Healthcare gender gap
Despite women accounting for 67 per cent of all healthcare workers globally, a new report from the World Health Organization and International Labour Organization found women are paid 24 per cent less on average than male colleagues – more than any other economic sector. Despite the pandemic increasing public appreciation for healthcare workers, there was little improvement in the pay gap. The WHO and ILO also found overall pay is lower in the sector because of the skew towards female workers – a trend seen in other professions. Why does it matter? Manuela Tomei, Director of Conditions of Work and Equality Department at the ILO argues: “There will be no inclusive, resilient and sustainable recovery without a stronger health and care sector”. Read: everyone’s health would benefit from tackling the pay gap – including men.
Our planet CLIMATE AND geopolitics
Millions of Australian bees have been put in covid-style “lockdown” and more than 15 billion have been killed after a deadly mite was detected in bee populations. The varroa destructor was first found at a port north of Sydney last month and has led to a shutdown of the New South Wales bee industry, raising fears for producers of honey products and the multi-billion-dollar agricultural industries, including avocados and almonds, that depend on the pollinators. Australia was the only continent free of the varroa mites, which have been decimating hives worldwide. The stakes are pretty high. No country has been able to eradicate the mite entirely after it’s been detected. The mite wiped out 90 per cent of wild bee colonies in New Zealand, who have offered their experts to try and help their neighbours fare better.
CULTURE soCIETY, IDENTITY AND BELONGING
Telford child abuse
More than a thousand children in Telford were abused over decades and a lack of police action “emboldened” the perpetrators, an independent inquiry has concluded. The three-year investigation found that issues were not investigated because of nervousness about race and information was not properly shared among agencies. Tom Crowther QC, the inquiry chairman, said: “The overwhelming theme of the evidence has been the appalling suffering of generations of children caused by the utter cruelty of those who committed child sexual exploitation.” West Mercia police offered an “unequivocal apology” to victims and survivors and said it now had dedicated teams tackling child exploitation. Further reading: our Sensemaker on the Linden report which found similar failings in South Yorkshire police’s investigation of CSE.
Thanks for reading. Please share this round and tell us what we’ve missed. Email: firstname.lastname@example.org.
With additional reporting by Phoebe Davis, Jessica Winch and Lily Isaacs.
Photographs Getty Images, Netflix
in the tortoise app today
Boris Johnson has finally admitted to meeting a former KGB officer without officials in a palace in Italy. Why does it matter?