Since Twitter was rebranded as X and Elon Musk took over, it has garnered considerable attention and turned many against the social media platform for its controversial content. This was especially the case with advertising companies, who did not want to land themselves in hot water for placing ads alongside hateful posts. Now, it seems like Musk is getting back to those companies, as X sues advertisers for their systematic boycott of the platform.
Elon Musk is suing advertising companies for their industry coalition against boycotting X, leading to a huge dent in the company ad business
Elon Musk decided to revamp Twitter by renaming it X in an attempt to create a holistic platform that integrated more services and made it your go-to social media app. The platform did receive appreciation for offering more freedom of speech, monetizing content creators, and making the overall user experience more seamless. However, the expanded freedom of speech did cause many to leave X due to concerns regarding the increase in hateful speech and lack of content moderation.
In November 2023, advertising agencies were apprehensive about placing their ads next to controversial or hateful content and being mistaken for being part of the polarizing content and endorsing it. Due to this concern, many big companies boycotted the platform, causing a rift between the companies and the advertising industry. X saw a major decline in Ad revenues with the takeover, re-branding, and finally, advertisers parting ways for the lack of content moderation policies.
Elon Musk has now pursued the matter legally and confirmed getting back at the companies with his anti-trust suit claims. The legal pursuit revolves around Elon Musk claiming that the companies have systematically boycotted the platform and conspired against it by withholding the advertising dollars, leading to a major blow to the company's ad business. He shared his frustration and plans about starting a row with the industry on X:
We tried being nice for 2 years and got nothing but empty words. Now, it is war.
The legal battle is being filed in Texas federal court, where the claim is that GARM - which is part of the World Federation of Advertisers that ensures safety guidelines are followed with advertising online - has formed an industry coalition with other companies to hold billions of dollars of X by boycotting the platform. A similar legal battle was pursued against the Center for Countering Digital Hate (CCDH) after its critical report regarding X and the monitoring of its hateful content.
The legal pursuit seeks damages for violating US antitrust law, which prevents monopolies and encourages competition. WFA has also faced a similar lawsuit from video-sharing company Rumble. We will monitor the situation to see how it develops, so stay tuned for more information.
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