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Court battle to open in Musk, Twitter buyout fight

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The court battle begins over Elon Musk's attempt to back out of his chaotic bid to buy Twitter

The court battle begins over Elon Musk’s attempt to back out of his chaotic bid to buy Twitter – Copyright AFP/File Olivier DOULIERY

Elon Musk and Twitter will face off Tuesday in the first court hearing over the Tesla chief’s move to abandon their $44 billion buyout deal, a case with massive stakes for both sides.

Twitter wants a judge to force Musk to complete the purchase, which he is trying to scrap over his allegations the social media platform misled him about its tally of fake accounts.

Billions of dollars are at stake, but so is the future of the platform that Musk has said should allow any legal speech, an absolutist position that has sparked fears the network could be used to incite violence.

The hearing in the eastern state of Delaware is set to include arguments over Twitter’s push for a September trial date, which is aimed at limiting the uncertainty plaguing the firm.

“Questions have been raised about Twitter’s future, and they don’t want this to drag on for very long,” said Carl Tobias, a University of Richmond law professor.

Musk’s legal team has filed papers arguing that date is far too soon for such a complex matter, and instead proposed mid-February.

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Twitter lawyers noted the deal is supposed to close toward the end of October, just six months after Musk launched an unsolicited bid that the company’s board first resisted but then supported.

The world’s richest person has backed away from the deal in recent months as tech stocks have tumbled, and Twitter’s value has fallen well below the $54.20 per share he offered.

– Musk willingness to fight –

Rather than Silicon Valley, where Twitter is based, the company has lodged its lawsuit against Musk in Delaware.

The firm is incorporated in the tiny state like scores of other companies, and the case will happen in the Delaware Chancery Court that has deep experience in business disputes.

“The Chancery Court, which handles most of these matters, is very expert in corporate law, and more particularly, mergers and acquisitions. So this is the place to go,” Tobias added.

Kathaleen McCormick, the judge overseeing the case, comes with a no-nonsense reputation.

She also reportedly has the distinction of previously ordering a reluctant buyer into completing a corporate merger.

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A forced closing of the Twitter deal is a scenario that some analysts consider possible.

“(Wall) Street and legal experts across the board view Twitter as having a ‘strong iron fist upper hand,’ heading into the Delaware court battle after months of this fiasco and nightmare,” analyst Dan Ives wrote last week.

He also noted less likely options include Musk paying a $1 billion breakup fee and being able to walk away, or winning outright on his fake-account argument.

After pausing the deal in May, Musk’s lawyers announced in July he was “terminating” the agreement because of skepticism over Twitter’s false or spam accounts tally and allegations the firm was not forthcoming with details.

Tuesday’s hearing will be just the first step in what could be a lengthy legal fight that could end in a trial, but also a settlement.

“Musk has shown his willingness to take things all the way to the end in Delaware court,” said Adam Badawi, a University of California at Berkeley law professor.

“I think settling is not necessarily his instinct.”

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Meta Launches New Reels Features, Including Stories to Reels Conversion and Improved Analytics

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Meta Launches New Reels Features, Including Stories to Reels Conversion and Improved Analytics

As it works to latch onto the short-form video trend, and negate the rising influence of TikTok, Meta has announced some new updates for Reels, across both Facebook and Instagram, including additional Reels insights, the expansion of the ‘Add Yours’ sticker, and ‘auto-created’ Reels clips. Yes, automatically created Reels videos.

Here’s how the new additions work.

The main addition is the expansion of the ‘Add Yours’ sticker from Stories to Reels, providing another way to prompt engagement from other users via Reels clips.

As you can see in these example images, you’ll now be able to post ‘Add Yours’ questions via Reels clips, while you’ll also be able to view all the various video responses to any prompt in each app.

It could be another way to spark engagement, and lean into the more interactive ethos of the short form video trend. Part of the appeal of TikTok is that it invites people in, with the participatory nature of the app essentially expanding meme engagement, by making it more accessible for users to add their own take.

Meta will be hoping that the ‘Add Yours’ sticker helps to facilitate the same, prompting more engagement with Reels clips.

Next up is auto-created Facebook Reels, which, as it sounds, will enable users to automatically convert their archived Stories into Reels clips.

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Reels updates

As you can see here, you’ll soon see a new ‘Create from Your Story Archive’ prompt in the Reels creation flow, which will then enable you to convert your Stories into Reels clips.

So it’s not exactly wholly automated Reels creation, as it’s just flipping your Stories clips into Reels as well. But it could provide another, simple way for users and brands to create Stories content, utilizing the video assets that they already have to link into the trend.

Worth noting that Meta also recently added a tool to convert your video assets into Reels within Creator Studio.

Meta’s also expanding access to its ‘Stars’ creator donations to Facebook Reels, which is now being opened up to all eligible creators.

Stars donations in Reels

Meta initially announced the coming expansion of Stars to Reels back in June, which will provide another critical monetization pathway for Reels creators. Short form video is not as directly monetizable as longer clips, where you can insert pre and mid-roll adds, so add-on elements like this are key to keeping creators posting, and fueling an ecosystem for such in its apps.

Stars on Reels will be available all creators that have maintained at least 1,000 followers over the last 60 days.

Meta’s also adding new Reels performance insights to Creator Studio, including Reach, Minutes Viewed, and Average Watch Time.

Reels updates

That’ll provide more perspective on what’s working, and what’s not, to help optimize your Reels approach – which could be especially valuable in the coming holiday push.

Lastly, Meta’s also expanding some Reels features that were previously only available in Instagram to Facebook as well.

Crossposting from Instagram to Facebook is now available to all Instagram users, while Meta’s also expanding its Remix option to Facebook Reels also.

Reels updates

As noted, Reels has become a key focus for Meta, as the short-form video trend continues to gain traction, and TikTok continues to rise as a potential competitor. By replicating TikTok’s main elements, Meta’s working to negate its key differentiation, which could ensure that more of its users don’t bother downloading a new app, and just stick with its platforms instead.’

Which, whether you agree with that approach or not, has proven effective. Reels content now makes up more than 20% of the time that people spend on Instagram, while video content, overall, makes up 50% of the time that people spend on Facebook.

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Meta additionally notes that it’s seen a more than 30% increase in engagement time with Reels across both Facebook and Instagram.

Meta doesn’t need to ‘beat’ TikTok as such (as much as it would like to), but it does need to dilute its significance if it can, and make it less appealing for users to have to start yet another new account, and re-build their friends list.

That’s why it’ll continue to replicate TikTok at every turn, because millions of people are currently not going to TikTok because of the presence of Reels in its apps.  

You can learn more about Meta’s new Reels updates here.

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