If that is true, then dump them! When a billionaire is too busy to pay bills, then he should be shut off. Of course there will always be some suck-up willing to front services to a rich person, but usually the provider will get screwed on the deal.
Google needs to learn to be proactive instead of quietly reactive on everything. They have no voice in the world, despite the immense power they have. Perhaps that is a strategy.
Let me clue you in: it's not that simple. If Google simply "dumps them", then Twitter will sue back with arbitrarily large damages, which far outweigh the money Twitter owes to Google.
It all hinges on details of their contract (or lack thereof), and Google has to tread carefully because the black PR of Twitter dragging them around as a result (and you know very well Elon is GREAT at playing the victim) will result in massive losses from other businesses using Google Cloud.
No one is leaving GCP because Google takes action against a non paying customer. Those that do are best sent packing anyway. You want good customers who are partners, not ones that will attempt to extort you. Maintaining these relationships leads to volatile/unpredictable revenue and can diminish margins (due to outsized account management and legal costs).
(speaking as a business owner previously who has had to fire customers)
We don't like it, but he keeps testing his power and getting his way. Sometimes I don't even know how. But truth is law and order stop applying when you have power or wealth.
Didn't Fidelity value it at $15 billion[1]? Musk bought it at $44 billion. That would mean that it's worth almost a third its original value so not even half
He spent $30B on his personal worldwide megaphone. Less than 20% of his savings. That's like a normal rich person buying an expensive house during a real estate bubble.
Calling his Tesla stock "savings" and using market cap to determine its liquid purchase power is astoundingly ignorant. Tell me, if you have, say, 100 million in savings, and you spend 20 million, does the remainder magically shrink also to 20 million, like happened with Musk in 2022?
Also do you realize he paid about 1/4 of the value of Twitter. The rest is loans and other investors burning cash by trusting him and rolling over.
Tell me why did a wealthy man who merely spent "20% of his savings" take on high-interest debts worth over 13 billion?
I think there's a distinction to be made. The powerful to exert their power without making public noise are probably more likely to get away with it. But the ones who proudly (stupidly?) publicly proclaim their misbehavior tend to fare less well.
There's a very high profile example of this right now in the US, and I suspect it will demonstrate the difference between silent abuse of power vs overt public abuse of it.
Are you referring to the man who successful ignored the law for 76 years, got filthy rich in the process, whose name becoming a colloquial term for extreme luxury living, and might face consequences by age 80?
Google should simply give them a deadline, pay within 30 days or we shut your stuff down. If they don’t pay shut it off and collect in full. Everything else is unfair to customers that pay in full and on time.
I'd be surprised if there wasn't very specific language on the consequences of late payments in their mutual contract (whether standard or custom drafted).
If you or me don't pay our bills, I fully expect the service to be terminated in 30 days... probably less than that in fact.
Shitter shouldn't get the same treatment as a big, well-known client (although given the quality of Google's support, I wouldn't be surprised if they do, thanks to runaway automation that can't be tamed even for big clients they very much want to give leeway to)
Shitter is in fact banking on that as part of renegotiations.
I find it completely fair if they did get the same treatment as everyone else.
Amusingly enough failing to pay utilities results in some of the most lenient reactions possible; partially because many localities make it illegal to remove electricity/gas service during "extreme weather months" (because old people freezing to death because they didn't pay a bill is really bad publicity for the utility and the government) and partially because they know they'll get theirs eventually.
They will cut you off when the time comes, but it can sometimes be surprisingly long. And they will put a lien against the property, too.
Having been in this situation myself, no they did not give a lenient time. I got a letter stating that they would shut off my electricity and gas. I had a mere couple of days to sort it out.
In my case it was their fault. I configured automatic payments and they migrated their online system and subsequently dropped my data for payments. Still, they were ruthless about it.
What I've usually seen is they threaten to shut you off with very strong wording, and then continue to threaten you for 3-6 months before they bother to send someone out.
My experience with LG&E and Time Warner in Kentucky circa 2008 was getting a shutoff notice dated the day after the payment due date with 14 days to comply. They did in-fact shut the power off at the state date.
This was a common occurrence that people referred to as 'brown billing' because the shutoff notice had a brown header instead of the green header on your regular utility bill.
It appears that Twitter is doing the same thing to AWS that it is attempting to do with Google. Both should just bounce Twitter and sue them in court. All Twitter has left is Azure and if they pull the same nonsense, Musk better sell more stock and start building data centers.
Not paying, is unprofessional, and is a poor way to treat your vendors or maintain a relationship with them.
NET 90 and asking for special quotes from big companies is definitely something that happens all the time. I'd say that is being stingy with payments. (It should be normal of course, but... that's what contractors often deal with)
Every contractor for large corps that I know has at least one story about chasing up payments and researching small claim court rules. I'm not exaggerating - every single one I talked to. It's sometimes "NET please forget this, and we'll try to drag it out anyways.".
Also the terms should be an agreement, but in practice it's: the large company has more power and will tell you their finance dept will not pay out before X - doesn't matter what you put on the invoice.
You're missing the point here. Yes, late payments are normal and happen all the time. What's happening here is not simply a late payment. It's a refusal to pay an already agreed upon price as a negotiating tactic in order to get a significantly cheaper price. How many stories of that do you have?
If the story here was just "Twitter is late paying its Google Cloud bill, and Google is giving Twitter additional time to pay in full", then that wouldn't even be much of a story.
This is why so many places accept credit card for what you would expect the fees would be too high for; because they know if they can get the large business to just pay the $50k on credit card they will never have to worry about collections, net 90, etc, etc. It's worth the $1,500 hit.
I've even been on the other side of that, expensing it because that was easier in our system than getting a PO.
Based on what I've heard anecdotally from e.g. freelancers providing services to large corporations, that ship has unfortunately long sailed.
There seems to be a huge spectrum, with "email an invoice payment instructions to the right department and you'll be paid, whoever you are and regardless of whether you provided any service" on one end, and "consider yourself lucky if you saw a cent at the agreed-upon time without having to resort to small claims court" on the other.
Obviously, it's much harder to pull off the latter when the payee is a huge corporation themselves and/or has leverage in terms of being able to cease providing ongoing services.
A bureaucratic company failing to pay a freelancer on time is not the same thing as this deliberate, top-down (i.e, Musk-designed) strategy of Twitter refusing to pay its bills.
Google Cloud has a lot of big customers. How many of them do you think are doing this?
I would guess that lot of slowness in payments with many companies is deliberate and it comes from quite high levels. Keeping cash in your own hands will generate marginal amount of return.
Now doing this with existential services you buy from providers that might actually take action and losing you isn't big thing is however not something anyone does.
Nonsense. Most real companies have real Accounts Payable departments and pay on a strict and reliable schedule.
I had one customer who (top professional auto race team builder) who made a practice of paying as soon as possible. I once got a check in the mail so fast i couldn't figure out how they turned it around that fast (exact amt of invoice, not tge estimate). Guess who always got absolutely prompt attention to their requests & requirements?
Non-payment is just a move for selfish a*holes, which Musk is turning out to be (& yes, I've defended him here before).
No it’s not and you should run away from whatever employer is leading you to believe this. They are trying to get you to believe it’s normal for when they stop paying your paycheck.
Sounds like this isn't about hosting Twitter itself, but some additional moderating-related services. That actually fits the pattern of where Musk tries to cut costs, although doing it by simply not paying bills is bizarre and stupid, and makes it less likely anyone else will ever want to do business with him.
I haven’t read the article, but one multi-billion-dollar company “refusing to pay its bill” to another multi-billion-dollar company is simply part of the contract re-negotiation process, no? (In the case where one company refuses to re-negotiate - either directly by saying so, or indirectly by tying it up in endless customer support redirects - it is arguably a necessary step, even.)
I get the sense that this reporting is trying to lean heavily on the usual implications of “refusing to pay the bill”, which is that one can’t pay the bill. But that implication obviously isn’t at play here; Google Cloud isn’t worried that Twitter is broke.
In all likelihood what’s actually happening is that Google Cloud strongly expects the new contract to be less profitable for them, and thus they wish to delay and drag out re-negotiations so they can have the more profitable contract for longer. Refusal to pay invites a lawsuit; if the cost of the lawsuit exceeds the profit that would be gained by holding onto the old contract for longer, it makes more sense to re-negotiate now. I predict Google Cloud will launch a token lawsuit for non-payment and come to the negotiation table at the same time, and when new terms are agreed on Twitter will settle the lawsuit by paying the old contract rates up to the date of the new contract.
No, it isn't normal to not pay the bills for services already rendered in order to try to get a better deal in future contract renegotiations. I don't know why you would think it is the expected behavior.
I don’t think this is normal or an expected behavior, apologies if my comment gave that impression. My claim is more that ‘Twitter not paying Google Cloud’ and ‘me not paying my mechanic’ are both situations where the phrase “refusing to pay the bill for services already rendered” is a true and accurate denotative description, but the connotations are significantly different.
For clarity’s sake, I completely agree that it’s a moral imperative to pay your bills on time and in full; what I’m saying here is that I’m not sure that moral imperatives are even the right framework for looking at these interactions between large companies (eg people have morality and ethics, companies have regulations and lawsuits).
> I completely agree that it’s a moral imperative to pay your bills on time and in full; what I’m saying here is that I’m not sure that moral imperatives are even the right framework for looking at these interactions between large companies (eg people have morality and ethics, companies have regulations and lawsuits).
Corporations are people, my friend. Any immorality committed by them is due to the immorality of their owners and executives.
It's easily possible to be an ethical businessperson; one just has to want to be ethical.
And the idea that corporations can walk away from their financial responsibilities and individuals shouldn’t is why strategic defaults were so large around 2008.
There are various methods of getting and collecting judgments where it will be illegal to not pay, or at least illegal to not cooperate with collections.
The easiest mechanism is definitely just refraining from providing more services. But when debts get to two commas, the legal fees will start to be worth it for collection.
Yeah, the situation is sort of like buying a car from someone, and you don’t like the previous owner’s agreed rate with the mechanic for ongoing maintenance, but you also park the car at the mechanic’s shop and if he stops doing daily maintenance your engine won’t start…
Twitter v Alphabet is tiny business versus huge business. I do not see why Alphabet would care if Twitter existed or not, so Twitter would not have anything to negotiate with.
It is sort of the inverse. To be pedantic, mechanics have mechanic's liens which allows them to hold a car forever until they're paid.
If it's worth enough for Google, Google could definitely bring full force of judgments. The only thing is the LBO debtors have a UCC lien which may be worth more than what Twitter is worth in a bankruptcy.
Twitter does currently have cash and may pay a judgment to prevent an event of default on the big debt. But debtors always have to worry being behind secured debt.
I may be naive, but isn’t having a good reputation and being cooperative with the people you depend on going to better for you when it comes to negotiations between companies?
> Google Cloud isn’t worried that Twitter is broke
Twitter is broke. "The company" spends more than it collects in revenue, and it has massive debts - the interest on which alone is greater than the revenue it collects. Sure it can borrow more money, from its shareholders if it has to, but even that tap can dry up.
Twitter owes ~$12B from when it was acquired by Elon. Somehow twitter owes this, not Elon. How is that a thing? Twitter put itself ruinously in debt in order to hand over control to someone else.
If you liquidate in market half the companies in SP500 will seem like they are broke even though by definition you need to be profitable to get into SP500.
But that is not how companies are valued at. They also are valued with potential.
“Twitter is broke” is a drama created by Musk basically is a reason he says for all the actions.
Share holder tap isn’t dried up. He just need to open the tap with lower share price probably less that quarter a price he actually bought it for.
Nothing is in dooms day situation.
I don’t think this is normal. If it was normal this would be happening a lot more. Obviously it’s being discussed because it’s Twitter but it would be helpful to provide some examples if you pieces so much together with no info.
It's rare to see Google continuing service for a non-paying customer. Usually, we see stories of them randomly banning people along with their digital livelihoods with no meaningful appeal process.
I am not sure we have seen stories of "I intentionally didn't pay, and was surprised to lose my service".
It's in Google's best interest to maintain continued service for GCP customers since any disruption makes both the customer and Google look bad, regardless of who is at fault. Google likely cares very much about Twitter's users, while Twitter might care more about what services they can lose, potentially at the expense of their users.
The first case sounds like an unintentional failure to pay. Here it makes Google look bad although it's not clear who is at fault. I think the circumstances are different, but I can see an argument of why similar policy should apply despite the different circumstances.
The second case sounds like an intention to discontinue service, and seem to be a different failure mode not quite related to the current article.
Every payment dispute has different circumstances, but surely it's possible to observe a pattern here. Google recklessly screws over ordinary people, even when unprovoked. But apparently they won't lift a finger when billionaires don't pay their bills.
BTW in the first case, Google looks bad because they are. Payment issues are common, and should never ever result in people losing their digital livelihoods. Bans should have a meaningful appeal process. Users should be able to reach human employees that has the power to actually resolve issues. There's no excuse for getting so many basic things wrong here given the consequences.
Your framing of the second case is plainly wrong too. It's theft by Google. You can't discontinue a service you never received. The author moved to prevent further theft only after Google explicitly refused to do what was right.
In my (direct) experience they are actually quite reasonable about payment hiccups, even extended ones. … at least when your spend is sufficiently high (500k/y+??)
I wouldn't be surprised if Google got so far over their head with various layers of automation they themselves don't know about that even a big customer will get shut down automatically.
I assume that by shutting them off, you forego collecting on some or all of the future contracted payments, but if you just leave the account in arrears, as long as you're confident they have the money somewhere, you'll eventually get all of it. Better to keep the meter running.
It's ok to post stories from sites with paywalls that have workarounds. In comments, it's ok to ask how to read an article and to help other users do so.
I tried both 12ft.io and archive.is to read this article, but neither seemed to work. Has anyone managed to bypass the paywall here and can share what worked for them?
It's behind a paywall, so I didn't read it, but I guess twitter wants to renegotiate their pricing and they feel like this is the only way to attract google's attention? I don't see anything particularly unusual in this tactic.
Google needs to learn to be proactive instead of quietly reactive on everything. They have no voice in the world, despite the immense power they have. Perhaps that is a strategy.