Saturday, November 16, 2019

Tweets that Shook Fortune 500 Companies


1. Tencent:
Daryl Morey (General Manager of Housten Rockets) on 04 October 19:
Tweet: “Fight for Freedom, Stand with HongKong” 
As Yao Ming from Shanghai, China was selected for Housten Rockets for the 2002 NBA, things changed forever for Basketball as a game in China. It Boosted the league’s popularity. The following data very explicitly do the talking: 
2015: Tencent acquired exclusive digital streaming rights for NBA games in a 5-year contract worth $500 million  ($100 million per year)
2019: The tech giant extended the rights to 2025; Contract worth $1.5 Billion ($ 300 million per year)
Viewership for NBA Games in China (650-750 million) is almost 5-6 times that of the US (90-110 million). Just for a comparative perspective, IPL Season 2019 had a viewership of 462 million, and the entire population of the US is 372.2 million. 
But the tweet didn’t auger well. Chinese Consulate in Housten responded by saying that they were ‘deeply shocked by the erroneous comments on HongKong’ 
For the damage control, Mr. Morey took down the tweet, players apologized and expressed their love for China and their fanbase. But perhaps it was too late. 
Smartphone Maker VIVO, broadcaster CCTV, and internet giant Tencent suspended all cooperation with the NBA or Housten Rockets itself. This had a significant impact on Tencent as a listed company. Alibaba ($ 435 Bn) and Tencent ($ 398 Bn) are just the 2 Non-US and Chinese companies that make into the US-dominated ‘List of public corporations by market capitalization.’ With the recent developments, the gap with Alibaba has widened much further. 

China has made it very clear that they don’t like others to meddle in their issues like HongKong or 3T (Taiwan, Tibet, and Tiananmen). There is a price that needs to be paid if done so, and now there lies a risk of importing Chinese Censorship along with profit that organizations look forward to reap because of the presence of 1.4 Billion people that China has and can really make a difference.

2. Tesla:
Elon Musk (Needs no introduction) on 07 August 2018: 
Tweet: ‘Am considering taking Tesla Private at $420. Funding secured’
His tweet “set off a trading frenzy,” and pushed Tesla’s stock price up more than 6 percent, forcing Nasdaq to halt Tesla trading for 90 minutes until the company gave an official response. The company’s stock price hit the intraday high of $387 before closing at $379.57 on the day of the tweet. It's currently trading at 350.43 (As of 7:37 pm GMT, 14th November 2019)
 The US Securities and Exchange Commission (SEC) sued Mr. Musk after his tweet. The SEC later claimed that the tweet was “false and misleading.” 

Outcome: Mr. Musk was directed to step down as chairman. Paid a fine of 40 million. Appointed 2 independent directors; Was directed to get his tweets reviewed before posting.
As the public face of Tesla, Musk had gained legions of fans for his bold approach to business and technology, and it can be expected that he is going to be around Tesla for many years to come. This is in the interest of the company also. In the recent Bloomberg survey, a question was asked to around 5000 Tesla owners. 
Question: Did the opinion of Elon Musk influence purchases? 55.4 percent responded affirmative (30.8 percent- strongly agree, 24.6% agree). 

3. Apple:
David Heinemeier Hansson (partner at Basecamp, a web-based software development firm on 07 November 2019 
Tweet:  “The @Applecard is such a f*****g sexist program. My wife and I filed joint tax returns, live in a community- property state, and have been married for a long time. Yet Apple’s black box algorithm thinks I deserve 20x the credit card limit she does. No appeal work.”
Steve Wozniak, too, responded on the same affirming that he and his wife also had experienced something similar. The tweet garnered much attention
 The apple credit card launched in partnership with Goldman Sachs earlier this year uses an algorithm to assign credit limits, and many online pointed out that it may favor men over women. The issue has been taken into, and has led to an investigation from New York’s Department of Financial Services over the issue of gender discrimination.  
An interesting thing happened when I was reading about Mr. David. He is a Le Mans Class-winning racing driver. And co-incidentally I  happen to be at Le Mans circuit currently as I am posting this on my blog. 

Mr. David can be reached @dhh on Twitter and is unavailable at other social media platforms. 


a. The viewership data quoted are subject to  much of deviation depending on the methodology adopted and source choose. I have tried to get a median number for higher degree of accuracy. 
b. Mr David in his tweet had used the full 'f' work instead of using * symbols


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