Elon Musk 'violated' Twitter NDA over bot-check sample size
- Reference: 1652713214
- News link: https://www.theregister.co.uk/2022/05/16/elon_musk_twitter_bot_nda/
- Source link:
The Register [1]asked the microblogging website how it made the estimate and was stonewalled, but in ensuing discussions over the weekend, Musk blurted out that the sample size was 100 accounts.
One [2]Musk fan asked how the userbase might help uncover the "real percentage" of fake accounts and was told:
Any sensible random sampling process is fine. If many people independently get similar results for % of fake/spam/duplicate accounts, that will be telling.I picked 100 as the sample size number, because that is what Twitter uses to calculate <5% fake/spam/duplicate. — Elon Musk (@elonmusk) [3]May 14, 2022
Amusingly, the next day Musk tweeted:
Twitter legal just called to complain that I violated their NDA by revealing the bot check sample size is 100!This actually happened. — Elon Musk (@elonmusk) [4]May 14, 2022
The number of fake accounts on Twitter is pertinent because it will affect plans to monetize the platform. The "less than 5 percent" figure was raised in Twitter's [5]latest earnings release [PDF] on April 28 which said: "We have performed an internal review of a sample of accounts and estimate that the average of false or spam accounts during the first quarter of 2022 represented fewer than 5 percent of our mDAU [monetizable daily active users] during the quarter."
[6]Elon Musk puts Twitter deal on hold over bot numbers claim
[7]Elon Musk wants to take Twitter public again 'within 3 years'
[8]Elon Musk flogs $8.4bn of Tesla shares amid Twitter offer drama
[9]Elon Musk set to buy Twitter in $44b deal, promises stuff
Obviously, Musk has taken issue with the estimate, and his [10]initial statement on the matter sent Twitter shares down over 10 percent to $40.40, some way below the $54.20 Musk offered. They're currently sitting at $40.72.
Questions are running wild about what Musk actually intends to do here. Is he trying to get the price reduced? Is he having second thoughts? Maybe he is looking for a way to walk away from the deal without losing face.
[11]
Richard Holway, an analyst at TechMarketView, [12]mused : "You may think this is just an entertaining sideshow. But real people are getting hurt. Twitter has already announced job losses and rescinded recent job offers. Recent buyers of Twitter shares might well have taken Musk at his word. Clearly that wasn't that wise as they are now nursing big losses.
[13]
"I always thought there were trading regulations around making price sensitive announcements. Every tweet that Musk makes moves markets – see his comments on taking cryptocurrency to buy Tesla cars etc.
"It's all getting a bit beyond a joke now…" ®
Get our [14]Tech Resources
[1] https://www.theregister.com/2022/05/13/musk_twitter_on_hold/
[2] https://www.dnaindia.com/viral/report-meet-the-23-year-old-pranay-pathole-space-x-ceo-elon-musk-twitter-friend-software-developer-tcs-mars-2940057
[3] https://twitter.com/elonmusk/status/1525304736538312707?ref_src=twsrc%5Etfw
[4] https://twitter.com/elonmusk/status/1525615849167589380?ref_src=twsrc%5Etfw
[5] https://s22.q4cdn.com/826641620/files/doc_financials/2022/q1/Final-Q1%E2%80%9922-earnings-release.pdf
[6] https://www.theregister.com/2022/05/13/musk_twitter_on_hold/
[7] https://www.theregister.com/2022/05/04/elon_musk_twitter_public/
[8] https://www.theregister.com/2022/04/29/musk_tesla_shares/
[9] https://www.theregister.com/2022/04/25/elon_musk_buys_twitter/
[10] https://twitter.com/elonmusk/status/1525049369552048129
[11] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/networks&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YoJ1IsMB2hROzjK@UJ@9kQAAAAU&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[12] https://www.techmarketview.com/ukhotviews/archive/2022/05/14/another-crazy-day-in-muskland
[13] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/networks&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YoJ1IsMB2hROzjK@UJ@9kQAAAAU&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[14] https://whitepapers.theregister.com/
violate ?
There's something wrong with a system that won't permit telling the truth in case it affects the market.
Re: violate ?
It's called economy.
Re: violate ?
The market is affected as much by who says it as by what was said. If he says something that gets interpreted as an attempt to weasel out of his bid or reduce the price it makes no difference whether it was true or not. Then let's consider your assumption that it was, in fact, true...
Well, if Musk violated the NDA then I guess the takeover is void /s.
Scared lawyers...
Sounds like the Twitter NDA enforcement legal team is a bit worried about their relevance in a post Musk world. I imagine the call went something like this...
Legal droid: "Mr. Musk, your recent statement is in violation of your NDA agreement."
Musk: "Ooops, thank you for catching that. It is valuable employees like you that made Twitter what it is today. What is your name and who do you report to?"
Legal droid, slowly realizing the gravity of their error: -Click-
"Any sensible random sampling process is fine."
Without knowing how the 100 were selected it's impossible to say whether it was a sensible sampling process.
With over 350 million users, a sample of 100 is meaningless. I know, I know, lies, damned lies, and statistics...
no, rubbish.
The ensemble size doesn't matter. If you choose 100 _truly random_ users, and "turing-test" them (this test being 100% accurate for the sake of the argument), finding 5 robots, your result is expected to be accurate to ~sqrt(5), no matter how many million users twitter has.
"Lies damn lies..." refers to _improper use_ of statistical methods not the statistical science itself.
Eh, assuming the sampling is robust it lands you on (in laymans' terms) +/-10%, which isn't great but is fine for the kind of orders-of-magnitude estimation that this figure is being used for.
Elon, of course, as an apparently well-educated technologist should know this off the top of his head. But he's not picking this fight because he has issue with the statistics. He's picking the fight because he bought Twitter for $40Bn the week before the tech stock market collapsed.
We're only one tweet away from Karen Musk demanding to speak to Twitter's manager.
1)Twitter has already announced job losses and rescinded recent job offers.
2) Recent buyers of Twitter shares might well have taken Musk at his word. Clearly that wasn't that wise as they are now nursing big losses.
Group 2 gets relatively little pity from here...
Wait a second...
After the offer had been approved by the board, shouldn't trading in twitter shares have stopped? So how does their share price drop?
If trading hadn't been stopped, quite frankly they were asking for it with Elon. This deal was never going to be smooth...
What's the endgame?
So Musk offered to Twitter for roughly 54 USD per share, his "interactions" with Twitter, the world and the universe send the share price plummeting. What sense does this make?
Discounting him having shorted Twitter shares, which would be very serious money crime, what's his motivation?
The deal does not get cheaper for him, if the Twitter share loses value, since he's offered a fixed price.
The deal also isn't going to go away, since any pre-this-whole-story owner of Twitter shares is even more likely to see the deal through, because of the fixed price offered by Musk.
So, what could be his strategy?
Re: What's the endgame?
If the deal falls apart, say, due to his now-complex network of co-financiers getting cold feet, then the deal will collapse. It's not guaranteed that it goes through. In this scenario he is due to pay Twitter $1Bn in cash, but that is far less of a penalty than whatever he's looking at from in the collapse of stocks, or even from the loss of value in Tesla because of the way he's using those shares to underwrite his Twitter buyout.
So what's the percentage of MDAU over total accounts (which is the number often reported)?
Richard Holway, an analyst at TechMarketView, mused: "You may think this is just an entertaining sideshow. But real people are getting hurt.
Interesting how he differentiates the public from "real people" isn't it.
Maybe, just maybe, Musk has a point. Especially if Twitter were relying on that sample size to swat off regulation ?