Within the past few weeks, there have been numerous headlines regarding various social media companies, both established brands and the alt-techs. Individually, they are little beyond mere headlines, but collectively, it amounts to an opening in chess with white and black executing on their respective openings. Instead of two players, there are numerous, all trying to take on the oligarchy of Twitter, Facebook, and YouTube.
Dorsey Tweets Goodbye
This past week Jack Dorsey stepped down as CEO of Twitter. There has been no shortage of bad takes from conservative media, who analyze this departure through the political lens. Some have argued that it was because of his politics, Dorsey resigned, leading to an immediate spike in Twitter’s share price. Others have rightfully identified that the replacement CEO tweeted some mean things denigrating the right. That because he is transparent about his beliefs in the censorship and promotion of preferred speech, it should enable the decline of Twitter because the emperor will have been seen naked.
Both of these takes are untrue. Dorsey’s departure was a business decision, plain and simple. Throughout his tenure as CEO, Jack Dorsey was far from a darling of Wall St. Though certain user metrics have improved since 2015, Twitter’s stock has vastly underperformed Facebook during that same period (along with most other tech giants). I would contend that Twitter would be more influential had they not killed Vine, which happened under Dorsey, as TikTok’s rise has proven, but therein lies the problem. To investors, Dorsey was neither ruthless, nor did he place the company’s interests first. Look up his mugshot. Wall Street has grown accustomed to Walmart dressed CEOs like Gates or Zuckerberg, but they brought results. Contrary, Dorsey’s rich hippie lifestyle is an ill received distraction, especially when he remains the CEO of Square, another publicly traded company. If Square is performing better than Twitter, based on human psychology, it would reason that he would focus more on the former than the latter.
All transactions aside, there might be more stringent speech restrictions under Parag Agrawal, but that is the natural trend of the Social Media Oligarchs. After all, they share the same politics, only now there will be a more ruthless leader atop Twitter, and the stock will likely reflect this in the years to come.
Rumblings on the NASDAQ
Earlier this month, alt-tech video platform Rumble went public via SPAC (Special Purpose Acquisition Corporation). In layman’s terms, SPACs are a blank check company formed to purchase or merge into another corporation. SPACs are faster than traditional IPOs with the downside risks of dilution or the failure to close the deal. Rumble merged into the SPAC CF Acquisition Corp. VI, in a deal valued at around $2.1 billion.
Though boasting about 40 million MAU (monthly average users), Rumble’s curated content is incredibly political, which you can see for yourself. Download their app, swipe left or right (to rumble as they call it), and you will find Dan Bongino, PragerU, OANN, Steve Bannon, and Sean Hannity. Regardless of what you think of those individuals, it is all more of the same and intentionally difficult for users to find new content creators. Locals, which they merged into, is better, but the same problem exists. Both are ultimately echo chambers which will rise and fall based on the brand’s face, in this case Dan Bongino (who I have nothing against).
Meanwhile, there exists Odysee, which is a decentralized, blockchain based video platform which has a broad array of genres and users who are not primarily political. Aesthetically speaking, Odysee is vastly superior to Rumble in every way and sorts by genre, making it easy to find new content.
Going public is a bold move, which undoubtedly will drive buzz for Rumble, but one can only go public once. According to Amazon, the Alexa Rank does not appear to be trending in the right direction, falling to 903 from 818. Unless Rumble can develop its app beyond a few key faces, one must ask, how sustainable is it?
Trump Social!
Just like Rumble, the Donald Trump backed Truth Social has undergone a SPAC IPO in recent weeks. Debuted under the name Digital World Acquisition Corp (DWAC), the stock has performed exceedingly well as eager investors are banking on Donald Trump’s rumored social media project. However, like all things Donald Trump, this too is unconventional, even in the high stakes SPAC world. More concerning, the stock has sky-rocketed without the deal being finalized.
In the normal course of events, founders create a product, receive venture backing, prove the concept of the business, and when they have finally made it, they go public. This is because early investors desire their long-awaited payday while the business requires new capital infusion. DWAC/TMTG lacks all of those things: no product, no users, and no concept images. But they raised a billion dollars of other peoples’ money and convinced likely conservative investors to buy into the stock. (Note: SPACs debut at around $10/share so they did not raise the $40/share it currently trades at.)
In a most recent development, the company is under SEC investigation pertaining to possible illicit trading of DWAC stock, but at least they will have a career politician in Rep. Devin Nunes at the helm, because being CEO of a tech company is just like running a dairy farm.
Thus far, Truth Social remains only a waiting list to a product that is behind schedule. One can view their investor presentation and find that there is no secret sauce except Donald Trump. Republicans flocking to Trump Social in droves as predicted in polls remains to be seen and is unlikely to materialize if the usability of the app is poor.
Just know that someone will make a lot of money, but it will not be the bag holders.
Torba Throws Shade!
Andrew Torba, Founder and CEO of Gab has been slinging some mud towards these alt-techs as a means of promoting his own and his vision of a Christian Parallel Economy. In his article, Gab Is Not For Sale, he takes aim at Rumble and Trump, stating that the former will bow to the demands of Nasdaq while accusing Trump of grifting off his supporters. Moreover, Torba maintains his disinterest in outside investment he believes would compromise Gab.
Conclusion
We believe the social media landscape will be an overarching theme of December. In an already alt-tech fatigued marketplace, there are still new entrants looking to pile into the space. In looking at the success of a given alt-tech in taking on the oligarchs, there are two predominant approaches: Astroturf vs. Grassroots. Astroturf social media companies, like Truth Social, Rumble/Locals, GTTR, and Frankspeech rely on a figurehead to bring his audience onto their site in order to drive growth/traffic. Grassroots social media, like Odysee and Gab, have userbases which attracts new content creators and influencers.
The rise of the Tech Oligarchs happened organically before our eyes. They created an ecosystem which eventually became dominant. Then they clamped down on dissent. Defeating them outright is impossible without sufficient alternatives that cultivate an grassroots ecosystem which people desire to join. When utilized properly, social media can disseminate information the mainstream media proscribes and provide entertaining content Hollywood does not produce. Simply put, it is a weapon. We as Christians must utilize it so, but this will, in the long run, require a platform to coalesce to while intelligently evangelizing on the oligarchical platforms. One might call it, a parallel approach.
