What you need to know

• Washington Post, Disney, Apple, IBM, Warner Bros Discovery, Sony, among other large companies have reportedly pulled ads from X after a report by Media Matters for America alleged X’s ad program places ads adjacent to pro-Nazi content and rewarded creators of that content.
• Musk’s retweeting of an allegedly antisemitic post on November 16 also inflamed the situation
• In response to the Media Matters report, Musk has filed a ‘thermonuclear’ lawsuit against the organisation for defamation.
• The recent ad strike is another blow to X with ad revenue reportedly plummeting up to 60% since Musk’s acquisition of the tech giant

Washington Post is the latest major media company to pull its ads from X, confirming the move in response to brand safety concerns overnight. Since mid-November, major media companies and brands including Paramount, Disney, Warner Bros Discovery, Apple and IBM have reportedly pulled advertising on X (formerly Twitter) after discovering their ads served against pro-Nazi and white nationalist content. Media Matters for America, a media watchdog group first reported the claims on the 16^th of November this year.

In response, X.com owner Elon Musk, who famously takes a purist view on free speech, is threatening to sue Media Matters for defamation. He said the organisation, “completely misrepresented the real experience on X, in another attempt to undermine freedom of speech and mislead advertisers.” Musk has also previously called Media Matters an ‘evil organisation’. 

The X boss is also not shy about letting his former advertisers know where to get off. Being interviewed on stage at the New York Times Deal Book Conference this week where Disney boss Bob Iger was also a speaker, Musk said, "Don’t advertise. If someone is going to try and blackmail me with advertising? Blackmail me with money? Go fuck yourself. Go fuck yourself, is that clear? Hey Bob, if you’re in the audience. That’s how I feel, don’t advertise.”

The dispute reinforces ongoing concerns about brand safety on the platform which emerged following Musk’s purchase of Twitter.

As debate over the issue has grown so has the list of advertisers pulling the pin. Other companies said to have halted advertising on the platform include Comcast, Sony and Paramount. Few of the advertisers have commented publicly on their move.

While ad revenue on the platform continues to plummet since Musk’s acquisition, according to Sensor Tower, Reuters reported that the ad revenue X receives collectively from the big six brands (Apple, IBM, Sony, Disney, Comcast and Paramount) represents 7% of X’s US ad revenue. Internal X sales team documents reviewed by the New York Times last Thursday suggests X may lose up to $75 million total in ad revenue, with even more brands joining the advertisers strike including Airbnb, Amazon, Microsoft, Netflix and Uber. It would mean another significant blow to X through the self-imposed struggles stemming from Musk’s policy of reduced moderation despite promising advertisers he will not turn X into a ‘free-for-all hellscape’.

The advertising strike by major brands and media companies is also coincidental to owner Musk’s recent decision to comment on seemingly anti-semitic conspiracy content which is  described he says ‘is the actual truth’. The content accuses the US Jewish communities of ‘dialectical hatred against whites’.

Zero tolerance

After the release of the Media Matters report, IBM told CNBC, “IBM has zero tolerance for hate speech and discrimination and we have immediately suspended all advertising on X while we investigate this entirely unacceptable situation.”

Media Matters also suggested that X has granted some white nationalist and pro-Nazi accounts ad revenue sharing schemes including @bambkb, an open holocaust denier who showed screenshots that he had received $3000 for his content this year. An X executive appeared to confirm the report telling Axios the company "did a sweep on the accounts that Media Matters found and they will [no] longer be monetizable".

X CEO Linda Yaccarino said X will “continue to protect the freedom of voices and opinions of users”, she said in a tweet. Yaccarino acknowledged the Media Matters report while conversely arguing only 50 advertisement impressions were served against all of the controversial content found in the report.

Brand safety

Media reports in the US highlighted the ongoing debate over brand safety. Lou Paskalis, an experienced advertising executive and Chief Strategy Officer of Ad Fontes Media told CNN, “Having ads run against racist and antisemitic content is the proverbial third rail for major advertisers who have enterprise-wide initiates to support diversity, to support inclusion, that are not only important to their brands but their employees and shareholders”, he said.

He added, “no amount of advertising benefit would ever displace the potential risk of one incident where your ad shows up next to unsavoury content.”

In December last year, Musk dissolved the platform’s Trust and Safety Council, an advisory group of one hundred civil and human rights organisations which provide guidance on content moderation for the platform. Brand safety concerns arose last year after Musk dropped thousands of Twitter employees, with now fewer than 550 full-time engineers and only 20% of the workforce still employed after Musk’s takeover. Additionally, Musk has reinstated thousands of previously banned accounts including Donald Trump, Andrew Tate, and founder of the neo-Nazi Daily Stormer website, Andrew Anglin.

Note: this story was updated on November 30 (AEST) after the Washington Post announcement.