Musk’s X sues advertisers over boycott

Elon Musk’s social media platform X has filed a lawsuit in Texas federal court against the World Federation of Advertisers and several major companies, including Mars and CVS Health. The lawsuit accuses them of conspiring to boycott the platform, causing not inconsiderable revenue loss. X, formerly known as Twitter, claims that through the Global Alliance for Responsible Media, these advertisers withheld billions of dollars in advertising revenue, violating US antitrust law.

The lawsuit alleges that the advertisers conspired to harm the platform against their economic interests. X’s CEO Linda Yaccarino emphasised that restricting the marketplace of ideas hurts people and that no small group should control what gets monetised. Ad revenue at X has been declining since Musk acquired the company in 2022, with some advertisers concerned about their brands appearing next to harmful content.

The responsible media initiative by the advertising group was launched in 2019 to tackle illegal or harmful content on digital media platforms. However, X argues that it has applied brand-safety standards comparable to its competitors. The lawsuit seeks unspecified damages and a court order to prevent further conspiracies to withhold advertising funds.

Christine Bartholomew, an antitrust expert, noted that proving an unlawful boycott requires showing an actual agreement among the advertisers, which can be challenging. Even if successful, the lawsuit cannot force companies to spend their ad revenue on the platform. Meanwhile, video-sharing company Rumble has filed a separate antitrust lawsuit against the World Federation of Advertisers.