Advertisers Flee Twitter amid Fears of Content Moderation as Musk Fires Half of the Company's Workforce
Advertisers pull back from Twitter amid growing fear that misinformation and hate speech will proliferate on the platform as the workforce is shredded under Elon Musk’s leadership.
Twitter has suffered "a massive drop in revenue" because of advertisers cutting back on using the social-media platform, new owner Elon Musk said Friday, as the company started sweeping layoffs just over a week after the billionaire took it over, reports the Wall Street Journal.
Excerpt from the Wall Street Journal: Mr. Musk in a tweet Friday, while Twitter was notifying about half its staff they were being let go, blamed the cutback in advertising on "activist groups pressuring advertisers." He said that the company hadn’t changed content moderation and had tried to address activists’ concerns. "Extremely messed up!" he said, casting the pullback as an assault on free speech. Mr. Musk’s remarks came after several big-name advertisers, including food company General Mills, Oreo maker Mondelez International, Pfizer Inc. and others have temporarily paused their Twitter advertising in the wake of the takeover of the company by Mr. Musk, the Wall Street Journal has reported. German car-making giant Volkswagen AG said it had recommended to its various brands they pause advertising on Twitter to assess any revisions the company makes to its brand safety guidelines.
While Elon Musk complains publicly about advertisers abandoning Twitter due to activist pressure, a coalition of civil rights groups is escalating a call for brands to halt spending on the platform in light of what they see as inflammatory rhetoric and problematic policy changes from the company’s new owner, writes CNBC.
Jessica González, co-CEO at Free Press, said at a press conference on Friday that earlier this week, Musk "promised to retain and enforce the election integrity measures that were on Twitter’s books before his takeover. With today’s mass layoffs, it’s clear that Musk’s actions betray his words,” she said.
Excerpt from CNBC: The coalition, dubbed #StopToxicTwitter, consists of organizations including Media Matters, Free Press, Accountable Tech and Color of Change. Earlier this week, the coalition sent a letter to companies including Amazon, Anheuser-Busch, Apple, Capital One, Coca-Cola, Disney, and Procter & Gamble to voice their concerns to Musk about what the group sees as increased hate and offensive speech on the platform. The coalition is now urging companies to pause spending on Twitter, fearing that widespread layoffs at the company could impede the social media platform’s ability to moderate content on the site. González said she is especially concerned about Twitter potentially loosening its content-moderation efforts prior to next week’s midterm elections, "when we know social media goes off the rails to misinform, intimidate and harm voters of color."
In a related story from the Wall Street Journal, current and newly former employees say Musk has instilled a culture of fear in his new company, as he quickly established he will be a stiff and efficiency-focused leader, aiming to unlock Twitter’s moneymaking potential once and for all.
Excerpt from the Washington Post: Musk has announced he wants to charge for blue check marks and employees are working on a new plan for paywalled videos. Advertisers are getting cold feet, and many are worried about the potential consequences for the midterms. Musk is under extreme financial pressure stemming from the acquisition of a site he has admitted to overpaying for. His first round of layoffs, which struck across the workforce, impacted teams including sales, engineering and product, and trust and safety and legal. In all, around half the staff was expected to be cut, casualties of Musk’s debt-financed purchase of the site, which is expected to saddle the company with bills the new CEO will face pressure to quickly address. Analysts have placed its value closer to $25 billion, well below the $44 billion price-tag footed by Musk and his investors. He is expected to owe $1 billion in annual interest payments alone, after taking out a large loan to help pay for it.
According to the New York Times, the layoffs hit across many divisions, including the engineering and machine learning units, the teams that manage content moderation, and the sales and advertising departments.
Excerpt from the New York Times: The first sign that some of the company’s 7,500 employees had been laid off came when their email accounts were shut off late Thursday. Yet they received no official word about termination and some of their Slack accounts still worked. In Twitter’s offices in Ireland and Britain, employees stayed up late waiting for the San Francisco headquarters to inform them of their job status. Some learned they were unemployed in the middle of their night. The cuts were so haphazard that at one late-night meeting about the Twitter Blue subscription product, at least one worker was locked out of the company’s systems during the call. Many employees vented on Twitter. By early Friday, the scale of the layoffs was becoming clear: Roughly half of the company’s work force, or about 3,700 jobs, had been eliminated. The layoffs leave Twitter significantly changed just over a week after Mr. Musk closed his blockbuster buyout of the company.
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