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X has filed an antitrust lawsuit against international advertiser groups for allegedly engaging in a “systematic illegal boycott” of the social media giant.
In her post, CEO Linda Yaccarino pointed to a US House Judiciary Committee report accusing the World Federation of Advertisers (WFA) and its Global Alliance for Responsible Media (GARM) of “collusion.” The organizations supposedly set out to demonetize any platform or content that disagreed with their values, including X, Joe Rogan’s podcast and “opposing political views.”
A Message to X Users pic.twitter.com/6bZOYPhWVa
— Linda Yaccarino (@lindayaX) August 6, 2024
A GARM member called for a meeting to discuss Elon Musk’s acquisition of Twitter (now X) and the potential for a boycott, according to the House report. The organization also supposedly held “extensive” talks around Musk’s purchase that gave plenty of time to arrange a boycott.
The resulting ad withdrawal cost X “billions of dollars” in revenue, according to Yaccarino.
We’ve asked GARM and the WFA for comment. GARM was created in 2019 to limit advertising against “illegal or harmful content” like hate speech. Its members include major companies like Mars and Unilever, some of which were named in the X lawsuit.
Since Musk bought Twitter in late 2022 and promised reduced content moderation, numerous advertisers have retreated over concerns their material might show next to harmful posts. Ad revenue has declined sharply since Musk took control, and in the second quarter of 2024 had reportedly dropped 53% year-over-year.
Whether or not the lawsuit succeeds isn’t yet clear. However, X is effectively arguing that advertisers aren’t allowed to make shared decisions on whether or not they place spots on a given platform. That may be difficult as there’s an implication that companies must run ads unless they independently decide otherwise.
The move comes as X has revived its lawsuit against OpenAI for allegedly misleading about the turn to a for-profit model.
