Billionaire Elon Musk declared “war” on Tuesday after filing a lawsuit against a handful of advertisers for allegedly violating antitrust laws by illegally boycotting his social media company and depriving X billions in revenue.
Musk and X Corp. CEO Linda Yaccarino took to the social media platform to address the lawsuit against the Global Alliance for Responsible Media (GARM), the World Federation of Advertisers, and GARM members CVS Health, Mars, Orsted and Unilever. The lawsuit claims the group of advertisers allegedly “conspired” to withhold billions in revenue from the social media company by coordinating a group boycott against advertising on the platform after Musk bought the company in 2022.
Yaccarino discussed the company’s decision in an open letter to advertisers, calling them out for choosing to “dismiss the facts” despite the company’s massive user growth jumping 25% since August 2022. (RELATED: Google Takes Massive Hit As Federal Judge Rules It Violated US Antitrust Law)
“The illegal behavior of these organizations and their executives cost X billions of dollars. Since arriving at X, I made it my mission to continue to build a platform where people, brands and advertisers can thrive in our unique, dynamic and safe environment,” Yaccarino wrote.
“We have proven our platform provides advertisers a way to showcase their brands and reach their target audiences safely, efficiently and effectively. That’s why I’ve worked in good faith with marketers across the globe to showcase our innovations and allay any concerns with brands whom I’ve partnered with for decades,” Yaccarino continued. “The unfortunate reality is that despite all our efforts, hundreds of meetings and research to the contrary, many companies chose to dismiss the facts. To those who broke the law, we say enough is enough.”
Musk commented on the announcement, responding to Yaccarino’s post with, “We tried peace for 2 years, now it is war.”
We tried peace for 2 years, now it is war https://t.co/elgT62uDtF
— Elon Musk (@elonmusk) August 6, 2024
The U.S. House of Representatives Judiciary Committee released a report in July on GARM’s harm to online speech. The Committee obtained evidence that shows GARM “and its members directly organized boycotts and used other indirect tactics to target disfavored platforms, content creators, and news organizations in an effort to demonetize and, in effect, limit certain choices for consumers.”
X’s advertising revenue dropped nearly 60% between April 2023 to May 2023. Major companies such as Apple, Amazon and Disney were among the group to either decrease or pause spending on the platform following Musk’s take over, with some ad agencies blaming misinformation and hate speech as a reason.
A federal judge ruled against Google on Monday, stating the major tech company violated antitrust law through its search business.
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