According to a recent Financial Times report, Elon Musk, the owner of X, has alienated major brands that have been avoiding the platform due to antisemitic content by telling them to “go fuck themselves” in an interview at the New York Times DealBook Summit earlier this week. As a result, X will now look to small and medium-sized advertisers to shore up revenue. Although the Financial Times presents a positive image of X’s future in which serving SMBs was always the company’s main objective, Musk has just issued a warning a few days ago that X would fail if it loses its major advertisers.
During the event, Musk gave a slight wink to the audience as he added, “What this advertising boycott is going to do is kill the company,” to interviewer Andrew Ross Sorkin. “And we’ll provide extensive documentation, so everyone will know that those advertisers killed the company.”
That’s not the tale that’s coming out today, when a corporate spokesman told the Financial Times that “it [was] always part of the plan—now we will go even further with it” and that “small and medium businesses are a very significant engine that we have definitely underplayed for a long time.”
That might just be a spin, of course. Since many of the major brands that have left X have no intention of coming back, X is really forced to move forward with SMB marketing options. Six marketing companies that the newspaper contacted indicated they would not be renewing their advertising on X, and other agencies said they had recommended advertisers to cease posting on the site as well, according to an article published in The New York Times. Some even predicted that their brief stops of advertising on X would probably become permanent. The Times further reported that some 200 sponsors had stopped funding the site following Musk’s impetuous response to another X user, which appeared to support an antisemitic conspiracy.
Musk made an effort to dispel misunderstandings about his comments in later posts and in his DealBook interview, but it’s safe to say that the harm has already been done and may not be undone.
But Sorkin shot back at Musk’s assertions that the world will blame the advertising for X’s demise. He urged Musk to reconsider that opinion, pointing out that the marketers would probably point the finger at him for his own behavior as he made them feel uncomfortable on the platform by saying “inappropriate things.”
“Tell it to Earth,” Musk shot back. “We’ll see how that goes over on Earth. We’ll present our own arguments and wait to see how things turn out.
However, the question of whether Musk will actually let X to fail still stands, even in the event that a decrease in ad income makes X unviable as a standalone firm. Sorkin noted that Musk has “enormous” resources to keep the company going if he so chooses as the richest person in the world.
Therefore, Musk’s reply suggested that he might let X pass away.
“In other words, if an advertiser boycott causes the company to collapse, then the company will fail due to an advertiser boycott. And everyone on Earth will be aware of the fact that this is what causes the corporation to go bankrupt. It will then vanish. A boycott by advertisers will result in its removal,” he stated.
Tell the judge about it, he said, when pressed once more regarding the brand safety concerns. The public is the judge.
Stated differently, Musk attempted to rewrite the storyline by pressuring the sponsors to go back to X or face the possibility of their own boycott.
However, as the FT notes, X is already working on alternative ad revenue streams, citing a previous partnership with marketing company JumpCrew, to whom it would contract out some ad sales with a focus on small and medium-sized businesses. Additionally, the business promised the FT that it would step up its efforts to reach SMBs. Along with other reports, this one mentioned that Linda Yaccarino, the CEO of X, has been “bombarded with calls” requesting her to step down in order to preserve her reputation. However, Yaccarino has defended Musk thus far in response to his remarks, notably in an internal email that CNBC obtained, in which she stated that “our principles do not have a price tag, nor will they be compromised—ever.”Additionally, we won’t be sidetracked by uninformed critics of our mission, no matter how hard they try.
