Large companies are suspending advertising on Twitter because they are concerned about the environment in which their brands will appear. However, Twitter owner Elon Musk blames “activists”.
New Twitter owner Elon Musk has threatened to publicly slam advertisers who no longer run ads on the platform. The tech billionaire was responding to a right-wing lobbyist’s suggestion that he should name such companies so that his supporters could subject them to a “counter-boycott”. Musk wrote in his response over the weekend, “Thanks. A thermonuclear naming and shaming is exactly what will happen if this doesn’t stop.”
In the past few days, the Volkswagen Group, the pharmaceutical company Pfizer and the food giant Mondelez, among others, had announced that they wanted to suspend advertising on Twitter. Musk complained about a “massive drop in sales” and blamed “activist groups” who put pressure on the companies.
The companies are responding to concerns that more hate speech and abuse could end up on the platform under Musk’s leadership and after the major job cuts he implemented.
Musk had raised such concerns himself with frequent criticism that Twitter had restricted freedom of speech on the platform too much. Last week he then tried to reassure advertisers with an open letter: Twitter will not be a place where you can do anything without consequences. Even now he emphasizes that nothing has changed in the content rules of the platform. Nevertheless, some advertisers are holding back.
Verification tick now subject to a fee
Advertising revenue is vital for Twitter: most recently, it accounted for a good 90 percent of revenue. Musk is also hoping for additional money from the subscription business. To do this, he changes the procedure for assigning the verification ticks, which previously guaranteed the authenticity of the profiles of celebrities, politicians or companies, for example. They were free and granted by Twitter after an audit. In the future, they will be available for customers of the Twitter Blue subscription service for eight dollars a month.
According to the company, the new version of the Twitter app with the necessary technical basis was made available over the weekend in the few countries where there was already a cheaper version of the Blue subscription. These include the USA, Canada and Australia. If everything works well and as soon as the translation work is done, the system will be rolled out worldwide, Musk announced on Twitter.
Musk countered concerns that this subscription-based verification could open the door to abuse by eliminating the previous Twitter verification. The previous system also had gaps, Musk claimed – and was convinced that the accounts could be verified much better on the basis of the payment systems for transferring the subscription fee and the app platforms from Apple and Google. If scammers try to pretend to be someone else, your account will be banned.
Musk does not have to publish business figures
The revenue potential of the subscription offer is meanwhile unclear. According to the latest data from the end of June, Twitter had almost 238 million daily active users. On that basis, that would be an additional roughly $1.9 billion a month if each of them paid for verification – which is totally unrealistic. In the second quarter, Twitter made almost $1.2 billion in sales with its previous business. After the acquisition by Musk, the company no longer has to publish financial figures.
At the weekend, Musk continued to give no information on the extent of the large job cuts initiated on Friday. But a tweet from manager Yoel Roth, who is responsible for filtering out problematic content among other things, was in line with media reports that around one in two jobs should be eliminated. Around 15 percent were affected in his area, while the proportion across the company was around 50 percent, Roth wrote.
The media had reported around 3,700 affected jobs, which corresponds to around half of the workforce. Tech journalist Casey Newton, who is well connected to online networks, also wrote that he had heard of employees who were laid off on Friday and received offers to return at the weekend.
Musk defended the broad job cuts. Twitter is losing more than $4 million a day and therefore there was no alternative, he wrote. Musk didn’t address the role servicing debt he incurred for the roughly $44 billion acquisition might play in the loss. On the other hand, he emphasized that the laid-off employees would be offered three months’ salary – one more than is required by law in California. According to media reports, employees still have to make commitments to Twitter for the additional salary.
UN human rights chief Volker Türk criticized Musk in an open letter over the weekend and called for responsible operation of the global platform. The fact that almost all human rights and ethics experts on Twitter were said to have been fired is “not an encouraging start” to Musk’s era on Twitter, High Commissioner Türk wrote to the technology billionaire on Saturday.
Politicians from the German governing parties also reacted with criticism. SPD digital politician Jens Zimmermann demanded in the “Handelsblatt” (Sunday) that the Federal Office of Justice “take Twitter under stricter supervision and act quickly and decisively in the event of violations”. SPD party leader Lars Klingbeil criticized the takeover in the newspaper as “highly problematic”. “Should the plurality of opinions continue to be attacked, the authorities must take decisive action,” demanded Klingbeil. The economic policy spokesman for the Greens in the Bundestag, Dieter Janecek, warned in the newspaper: “With Elon Musk, a multi-billionaire is now controlling Twitter, who himself has pretty crude political ambitions.”