Let’s examine this: can a social network sue a company because it doesn’t advertise on its service? It would seem that’s a free choice. But leave it to Elon Musk to create his own rules. X added Twitch to a lawsuit for “boycotting” the social media’s advertising options.
Looking for More Advertising Dollars
Advertising is everything on the Internet. If this is how you intend to earn a living, you have to either advertise or host advertising. Without this system, neither would survive.
Businessman Elon Musk certainly knows how this works. He owns Tesla, SpaceX, and X, and is a founding member of OpenAI. All well-known companies. But Musk isn’t liked by everyone in the business world, so once he took over Twitter and renamed it “X,” there were some companies that didn’t want to continue to advertise on the social network.
One of those companies is Twitch. X has added the live-streaming service to an existing lawsuit against many companies. The complaint is that the companies conspired with an advertising group, boycotting the Musk-owned X. Although Twitch is a subsidiary of Amazon, the parent company was not named in the lawsuit.
X’s Antitrust Lawsuit
The Word Federation of Advertisers, CVS Health, Mars, and Danish company Orsted were accused in the original complaint for joining others and conspiring to keep “billions of dollars in advertising revenue” away from X in the aftermath of Musk’s takeover.
X believes a “group boycott” was formed that preempted the spending of advertising dollars, violating U.S. antitrust law. When the amended lawsuit was filed Monday. Twitch had been added, and Unilever dropped. The latter company announced last month that it had reached an agreement with X.
Some advertisers were leery of advertising on X after Musk bought its predecessor, Twitter, just a little over two years ago. They feared that their brands would be seen next to harmful content, such as racist viewpoints and fake posts. This showed in the ad revenue that was reported after Musk took over X.
X’s lawsuit states that Twitch never purchased ad space on Twitter or X in the United States after November 2022. Nevertheless, Musk seems to have found ample money that he donated to the president-elect’s campaign, leading to a role in the new administration.
If X were to win this lawsuit, it could set a dangerous precedent. Why should a company be forced to advertise in another company’s ad space – especially when that company clearly doesn’t need that added revenue? While advertising is certainly a necessary aspect of online business, there should be free choice involved.
If you’re an Apple user and don’t want to see ads, check out Distraction Control on iOS 18.
Image credit: Unsplash. Screenshot by Laura Tucker.
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