What’s Killing X? It’s Not Much Of A Mystery

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Elon Musk has done a great job of making people pay attention to how he’s running X, the social media network formerly known as Twitter. However, in this case, that attention cannot possibly be construed as a positive thing. Every day, it seems like another large advertiser is leaving the platform.

There are really just a few reasons for the mass exodus. Because of Musk’s brash, often uninformed and sometimes offensive takes on world events, which are widely spread on the platform. Because the lack of moderation and verification means objectionable content is freely published—and sometimes turns up right next to advertisements. And because of Musk’s perpetual victimhood, put on display last week on stage at the New York Times’ DealBook Summit, when he said advertisers are “blackmailing” him with money, and they should “go f*** themselves.”

Shortly after Musk left the stage at the DealBook Summit, Walmart announced that it would no longer advertise on X. The retail titan wouldn’t say that Musk’s tirade was what caused them to break the deal, but told Forbes “we’ve found some other platforms better reach our customers.”

After cursing at them, Musk continued to cast blame on the advertisers who have pulled their support for his platform. “It’s going to kill the company,” he continued. “The whole world will know that those advertisers killed the company and we will document it in great detail. Let’s see how Earth responds.”

But it isn’t the advertisers’ fault. The blame belongs to Musk, whose leadership impacted both the usefulness and trustworthiness of the platform as a whole. In the last week, there were at least two high profile cases of impersonation that X did not address. A scammer bought ads for a fake cryptocurrency “X Token” that looks like it was created by Musk himself. And a fake post purporting to be from X CEO Linda Yaccarino comparing the number of posts on the platform about Henry Kissinger following his death last week to those about Colin Powell, who died in 2021, also went viral.

It’s almost surprising that anyone turns to X any more for messages they can trust. And unless things drastically change soon, the number of people who do will certainly dwindle.

SOCIAL MEDIA

X isn’t the only social media platform dealing with a lot when it comes to messaging. Facebook owner Meta, which has promised stringent moderation of campaign ads leading up to 2024 and a ban on AI-generated election ads, is already taking action. Last week, the company said it’s already shut down a network of 4,789 fake accounts originating in China, apparently designed to polarize U.S. voters ahead of next year’s election. These accounts, Meta said, didn’t create their own disinformation, but instead copied and pasted X posts from politicians on both sides of the aisle. This is the second large cache of fake accounts from China that Meta has shut down. In August, the company took down 7,704 Facebook accounts, 954 Facebook pages, 15 Facebook groups and 15 Instagram accounts linked to disinformation campaigns that weren’t necessarily political in nature.

In Europe, several consumer groups have filed a complaint against Meta, saying its new “pay-for-no-ads” subscription service violates European privacy law. In order to use Facebook or Instagram in the countries using this new model, a user either needs to opt in to targeted ads—a requirement in European law—or pay a subscription. Meta has said that they are following the law, but the complaint says blocking people from the apps unless they pay or consent amounts to “unfair, deceptive and aggressive practices.”

Last week, a federal judge in Montana issued a preliminary injunction to halt the state’s ban on TikTok, which was signed by Gov. Greg Gianforte in May. The first-of-its-kind ban of the video sharing app had its roots in parent company ByteDance’s Chinese ownership, and was intended to prevent data harvesting. It would have gone into effect on Jan. 1. The actual legality of the ban, which has been challenged by several TikTok creators, will be ruled on at a bench trial that has not yet been scheduled. However, the opponents of the ban, who say it oversteps state authority, have won their first battle.

BRANDS + MESSAGING

Barbie has always represented women’s empowerment. While Mattel’s classic doll has seen her ups and downs, with critics calling out Barbie’s unrealistic body shape and the need for more diversity in race, nationality and physical ability (which have been addressed in recent years), she’s always been a model for little girls to aspire to when they grew up. This summer’s blockbuster movie Barbie reinforced the power the doll has held for 65 years. So it’s not entirely surprising that Barbie earned a spot on Forbes’ 2023 Power Women list. She’s not flesh and blood, like entertainer extraordinaire Beyoncé Knowles-Carter or Vice President Kamala Harris, but the plastic doll has lived up to her brand this year.

A brand that may need some work is Tesla’s “apocalypse-proof” Cybertruck. The first of the angular electric vehicles were delivered at a live event in Texas last week. While the vehicle doesn’t come close to delivering on early promises of a battery with a 500-mile range and a price tag under $40,000 (it has a 250-mile range and a $60,990 price tag) and it looks as if it was made from blocks, the messaging around the vehicle seems to have a very specific target. At the delivery event, video was shown of demonstrators firing handguns and a Thompson submachine gun at the vehicle, as well as podcast host Joe Rogan shooting an armor-piercing arrow at it. “The apocalypse can come along any moment, and here at Tesla we have the best in apocalypse technology,” Musk said at the event while laughing. It remains to be seen whether a meaningful percentage of car buyers—especially those considering an electric vehicle—will want to spend more to get that as a feature.

Soccer legend Cristiano Ronaldo, who is the world’s highest paid athlete, faces a $1 billion class action lawsuit from Binance investors for using his personal brand to promote the embattled cryptocurrency exchange. Late last month, Binance and its former CEO Changpeng “CZ” Zhao pleaded guilty to federal charges dealing with selling unregistered securities. Binance agreed to pay a $4 billion penalty. Members of the group suing Ronaldo say that the star, who has the resources to vet companies he works with, should have known about the concerns with the exchange and had awareness that he was abetting fraud. Ronaldo did not respond to Forbes’ request for comment.

ARTIFICIAL INTELLIGENCE

While AI may be an example of the most successful branding campaign of all-time, it’s also disrupting nearly every industry. Some musicians, including singer and songwriter Grimes, are embracing its possibilities. Grimes works with CreateSafe​, an applied research studio​ that builds tools and protocols for artists to automate the creation, distribution and marketing of music IP. Through this partnership, Grimes’ music and sound effects are available for licensed users to create with using AI. Grimes and CreateSafe are also developing Triniti API, a generative AI music production platform​ that artists use to create and distribute music. Through these tools, artists can license their assets—including their likenesses—and be able to benefit from others using AI to further create.

DEEP DIVE

Care Bears And Other Classic Toys Are Back In Vogue, Sparking ‘Fist Fights’ Over Licensing Rights

Nostalgia for the ‘80s and ‘90s is huge, so toymakers want to bring back the playthings that defined childhood in those decades. However, competition for these licensing rights is becoming fierce, driving up costs and making it difficult for exclusive deals to take place. Forbes’ Lauren Debter took a look at the race to reproduce nostalgic toys. Major licensing agreements, which might have cost $100,000 a few years ago, could now run a manufacturer $500,000 to $1 million, Loyal Subjects CEO Jonathan Cathey told Forbes. His company is a toymaker with some licensing rights to Teenage Mutant Ninja Turtles, Teletubbies, Strawberry Shortcake and Rainbow Brite.

While getting licensing rights can be expensive and difficult, it’s worth it. A quarter of all toys—about $9 billion—are bought by people 12 and older. Many of the buyers are adults remembering their younger years, or purchasing a new version of one of their old favorites for a child.

“Tugging at the heartstrings of a parent, or even a grandparent, is a fantastic way to market your product,” Juli Lennett, a Circana toy analyst, told Forbes.

Today’s licenses also tend to be divided among manufacturers. Maybe one will get rights to remanufacture “classic” versions of the toy. Another will get the rights for an upscale collector’s version. Another will be able to make a miniature model.

“There’s definitely more competition, but there’s also more opportunity,” Alan Dorfman, CEO of Super Impulse, which sells miniature versions of Power Rangers, Hot Wheels and Mr. Potato Head, told Forbes. “Some of the larger companies that have held onto rights for years see classics are not getting attention and are starting to offload them and license them out.”

FACTS + COMMENTS

The NBA’s new In-Season Tournament started this year as a way to build excitement throughout the early basketball season and drive more viewers just in time for the league to negotiate its next media rights deal.

2 million: Nationwide viewers for a tournament game between the Sacramento Kings and Golden State Warriors last week

26%: Increase in viewership for tournament games on TNT and ESPN, compared to regular games last November

‘NBA basketball has never been more fun’: Commentator and former NBA coach Stan Van Gundy said on a game broadcast

VIDEO

Kendall Jenner's 818 Tequila Isn't Just A Celebrity Product, It's A Multimillion-Dollar Endeavor

QUIZ

Canned water brand Liquid Death recently renamed one of its flavors “Dead Billionaire” after what it characterized as a legal threat from the estate of the person it was initially named after. Which well-known person was it?

A. Frank Sinatra

B. David Bowie

C. Arnold Palmer

D. Ivana Trump

See if you got it right here.