X Brings Antitrust Lawsuit Against Advertising Group

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Facts

• X (formerly Twitter) filed an antitrust lawsuit in Texas federal court on Tuesday against the World Federation of Advertisers (WFA) and several other major companies, including Unilever, Mars, CVS Health, and Orsted.^[1]
• The lawsuit accuses the companies of violating antitrust laws by orchestrating a 'massive advertiser boycott,' resulting the loss of billions of dollars of advertising revenue.^[2]
• X CEO Linda Yaccarino said evidence presented before the US House Judiciary Committee in a July hearing to scrutinize current anticompetitive laws proved this alleged 'organized' and 'systematic illegal boycott.'^[3]
• X's advertising revenue has fallen much since being bought over by Elon Musk in 2022 — it expects roughly $2B this year, down from $4.5B in 2021.^[4]
• Social media company Rumble has backed Musk's suit, with CEO Chris Pavolvski claiming in an interview with Fox News on Thursday that the WFA has 'create[d] a monopoly across all the big ad budgets.'^[5]

Sources: ^[1]New York Times, ^[2]Wsj, ^[3]Associated Press, ^[4]Axios and ^[5]FOX News.

Narratives

• Narrative A, as provided by FOX News. The WFA and other companies engaged in an advertising boycott racket. This was a coordinated effort to demonetize and limit certain platforms, content creators, and news organizations. This conspiracy cost X billions of dollars in ad revenue and was an unfair anti-competitive tactic aimed at limiting certain viewpoints.
• Narrative B, as provided by Spiceworks Inc. It will be very hard for X to prove that advertisers were engaged in a boycott. Even if X wins this case, companies cannot be forced to advertise on X, which isn't automatically guaranteed the money or business of advertisers. Besides, the truth is that advertisers left the platform due to Musk's gross mismanagement of the company.