Major Companies Withdraw Advertising from X
Apple, Warner Bros. Discovery, Disney, and Paramount Global have joined the list of major companies pulling their advertising from X. This comes as a blow to the platform's efforts to regain the trust of big brands and secure their ad dollars, which serve as X's primary source of revenue.
X Files Lawsuit Against Media Matters
X, based in San Francisco, has filed a complaint in federal court in Fort Worth, Texas, accusing Media Matters of knowingly and maliciously portraying ads next to hateful content. X claims that Media Matters manipulated algorithms to bypass safeguards and create false impressions of its largest advertisers' paid posts being associated with racist and incendiary material. The company refers to these pairings as manufactured, inorganic, and extraordinarily rare.
Musk Announces Lawsuit Against Media Matters
In response to the situation, X CEO Elon Musk took to social media, stating that the company will be filing a lawsuit against Media Matters and anyone involved in what he calls a fraudulent attack on X. Musk's post on the matter received significant attention over the weekend.
Media Matters Stands Firm
Despite the impending legal action, Media Matters has stated that it will continue its work. Angelo Carusone, President of Media Matters, confidently expressed that if X sues them, they will prevail in court.
In a recent interview, an industry expert revealed that the safety measures implemented by Company X to prevent ads from appearing next to harmful content are not effective. The expert conducted a study and found that even when searching for white nationalist content, ads still appeared alongside it, indicating a failure in the system that was supposed to prevent this.
Following Company X's announcement of a lawsuit against a nonprofit organization, the Texas Attorney General expressed his intention to investigate the nonprofit for potential fraudulent activity. This aligns with Company X's claim that the organization manipulated its results.
Ever since Elon Musk took over Company X, advertisers have been hesitant to associate themselves with the platform. Musk made significant changes, including downsizing the workforce, disbanding the Trust and Safety advisory group, and eliminating the user verification system.
In a tweet, Musk revealed that Company X has been facing financial challenges, with a significant drop in advertising revenue and a heavy debt load. These factors have contributed to negative cash flow for the platform.
Musk himself has faced criticism for his controversial posts, including one where he responded to a user's anti-Semitic comment by seemingly endorsing it. This has further fueled the outcry against him and the platform.
Musk has faced accusations of tolerating antisemitic messages on the platform since purchasing it last year. Under his ownership, X rolled back rules that removed "violative hateful content" on the platform, the Anti-Defamation League said in a June report. According to the ADL's analysis, 27% of online harassment in the first half of 2023 occurred on X, up from 21% in 2022.
X CEO Linda Yaccarino, who joined the company in May, said the company's "point of view has always been very clear that discrimination by everyone should STOP across the board."
"I think that's something we can and should all agree on," she wrote on the platform last week.
