“We were nice for two years and got nothing but empty words. Now it’s war.” : in a scathing message published on August 6 on his X network (ex-Twitter), Elon Musk denounces the practices of advertisers present on his platform. He accuses them of having illegally deserted the social network since its acquisition in October 2022. Although he describes himself at every turn as a champion of freedom of expression, Musk seems to think that these companies must be his customers.
Advertisers accused of depriving X of “billions of dollars in revenue”
X filed a lawsuit in a federal court in Texas against the World Federation of Advertisers (WFA) and several companies including the Anglo-Dutch multinational Unileverthe American food giant Mars, the pharmacy chain CVS Health and Ørsted, one of Denmark’s leading energy companies.
In the complaint filed by Xthe WFA is accused, through its Global Alliance for Responsible Media (GARM) initiative, of having used antitrust practices to “collectively deprive billions of dollars in advertising revenue” the social network. He is seeking damages in an unspecified amount.
The GARM initiative was created in 2019 by the WFA to help the advertising industry take action against illegal or offensive content on social networks. In its complaint, X (ex-Twitter) assures that it has applied security standards comparable to those of its competitors, which meet or exceed the guidelines set by GARM.
Insults, repeated slip-ups, disinformation and conspiracy theories
However, since Elon Musk bought the platform, the moderation barriers seem to have given way. Hate speech has multiplied, without being blocked, and thousands of banned accounts have reappeared. If many major advertisers have left the platform, it is simply because they feared seeing their ads alongside problematic or offensive content.
In January, eSafety, the Australian online safety regulator, revealed that X (formerly Twitter) had laid off more than 1,200 employees… responsible for combating abusive content. Twitter was already a bad student in this area before the acquisition, and this pure and simple elimination of the teams obviously did nothing to improve matters. The European Commission opened an investigation into the social network at the end of last year for violating the DSA, in particular regarding its actions to combat illegal content and disinformation.
Elon Musk had caused other advertisers to leave in November after he supported an anti-Semitic conspiracy theory on his social network. The billionaire apologized, but took a completely different approach to advertisers who suspended their ads: he accused them of “to blackmail”before telling them during a filmed conference “Screw you. Is that clear ?”.
The billionaire has spoken out even more since then, and he now openly displays far-right ideas. For example, he called the American media “anti-white racists” last year, when they decided to stop publishing a comic strip whose author had compared the black population to a “hate group.” Invited to a far-right political rally in Italy A few months later, organized by Giorgia Meloni’s party, the billionaire attributed the departure of his advertisers to the “woke virus”, before supporting the theory of the great replacement.
Worrying financial health
Could the lawsuit be a way for the American billionaire to save his platform’s finances? In the second quarter, the social network generated revenue of $114 million (€104 million), down 25% compared to the first half and 53% compared to the second quarter of 2023. Fund manager Fidelity, which had injected $19.2 million into Twitter at the time of the takeover, devalued its investment by 71.5%.
Musk originally relied on a paid subscription strategy to emancipate himself from advertisers by changing his business model. To do so, he tore down the existing account verification system and replaced it with paid accounts with more visibility and additional features. This resulted in an explosion of automated spam (which Musk had promised to eliminate) and disinformation campaigns, but without generating much revenue in the end, as the majority of users continued to use the site for free.
Elon Musk is now considering making the platform paid for all users, based on an annual subscription of one dollar per year. This formula is currently being tested in New Zealand and the Philippines.
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