Friday briefing: What Elon Musk’s latest outburst means for the future of X

1 Dec 2023

Elon Musk bought X (previously known as Twitter) for $44 billion just over a year ago, but things are not going well for the company. It has lost 5,500 employees, has negative cash flow, and its value has plummeted by 55% to $19 billion in only 12 months. In addition, X may lose up to $75 million of ad revenue by the end of this year because 200 companies, including major players like Disney and Apple, have stopped advertising on the social media platform. This happened after Musk endorsed a tweet that accused Jewish communities of pushing “hatred against whites that they claim to want people to stop using against them.” Musk replied to the tweet by saying, “You have said the actual truth.” Media Matters, a monitoring organization, then published a report showing large brands advertising next to posts supporting anti-Semitic and white nationalist content. In response, Musk is suing Media Matters.

After Musk endorsed a controversial statement, there was a quick and harsh backlash. Musk recognized that if the protest persisted, it could cause his company to go bankrupt. Even though he sought forgiveness and met with the prime minister of Israel, Benjamin Netanyahu, Musk hasn't appeared to adjust his business strategy. Instead, during an interview with Andrew Ross Sorkin at the New York Times' DealBook Summit, he shockingly told advertisers to "go fuck themselves." He labeled the boycott as "blackmail" and directed the 200-plus companies not to advertise with X.

The video, which has been seen by a considerable amount of people according to X's data, shows Musk behaving childishly and projecting an attitude of "I didn't care about you anyway" towards Disney, IBM and other companies that he felt dismissed him. This way of behaving is typical of Musk's confrontational style in the business world.

Therefore, what implications does this have for X? Is it possible for Musk to recover from this situation? In order to address these inquiries, I had a discussion with Blake Montgomery, the US technology editor of The Guardian, immediately following the news articles.

The conflict between Israel and Hamas continues as the Israeli military has restarted its attack on Hamas in Gaza. According to reports, Hamas had broken the truce, leading to this escalation in violence. The Israeli army claimed that Hamas had violated the operational pause and fired towards Israeli territory. Meanwhile, sources close to Hamas, such as Shehab news agency, have confirmed that explosions and gunfire were heard in the northern Gaza region.

Rishi Sunak, who is on his way to the Cop28 summit in Dubai, has been criticized for giving off the wrong impression about addressing the climate crisis. He made comments suggesting that his updated targets for achieving net zero emissions prove that he is not beholden to extreme ideologues.

The leader of Iceland has criticized the unjust treatment of new parents and has supported the request for a limit on the prices of baby formula. This action was taken after investigations by the competition watchdog revealed that major suppliers were practicing greedy pricing.

Train drivers belonging to the Aslef union have recently commenced a new round of industrial action, which will specifically include an overtime ban and a number of rolling strikes that are set to cause significant disruption to rail services for a period of nine days. This latest wave of strikes has been called due to an ongoing disagreement between the union and rail operators pertaining to pay.

In the world of monarchies, a prestigious writer has revealed that an inquiry is currently ongoing regarding the recent release of the Dutch version of his latest book. This version contains the names of two important members of the British royal family who allegedly engaged in a conversation pertaining to the skin tone of the Duke and Duchess of Sussex's upcoming child.

Competitors See Failure; I Agree

It's not clear why Musk said what he did, but he's known for being a confrontational tech expert. He believes his products are the best, and has a reputation for doing whatever he likes. According to Musk, Tesla has done more than any other company to help the environment, and has beaten its competitors in sales. Some people think he's using a similar strategy on Twitter, but Twitter isn't as good as technology made by Meta, Google, Amazon or Apple. In fact, it's famously chaotic and not as financially successful.

What is the current status of Twitter?

When I inquired from Blake about his assessment of X's performance as a company, his response was a simple thumbs down gesture. "That sums it up concisely," he stated.

X is currently under heavy competition, as many new social media platforms are coming up with similar products. Meta's Threads gained more than 100 million downloads within a week of its launch and currently has around 137 million users. Blake states that other companies have started viewing X as an opportunity, which was not the case before Elon Musk's acquisition. This clearly indicates that Musk's peers view his ownership of X in a negative light and believe that it's not doing well at all. In simple words, they're right.

This issue didn't just start recently. Musk shared in July that advertising revenue had decreased by 50% and X had a large amount of debt, even though there was optimism in March that X would have positive cash flow by June.

Despite hiring Linda Yaccarino as the CEO, who has a strong reputation in advertising and extensive connections, the concerns of advertisers and Musk's unpredictable behavior have not improved. In fact, Musk's diminishing reputation has affected Yaccarino, as marketing leaders are reportedly pushing for her resignation.

It's not only boycotts from advertisers, several big brands have completely halted their activity on the social media platform.

Is it possible for Twitter to bounce back from this decline?

Prior to Musk taking over X, users had been expressing dissatisfaction with their experience on the platform; however, despite this, people continued to use it, and somehow it was able to stay afloat. Blake expresses that people have misjudged the potential of Twitter or X before and it could potentially make a comeback, but at present, it seems unlikely.

Another choice for the company is to declare bankruptcy. Musk didn't appear to be interested in purchasing X despite making an initial offer. However, he was compelled by law to acquire it and now has to deal with the burden of its unprofitable $44 billion nature. Blake suggests that many tech journalists speculate that he may be trying to go bankrupt quickly, and telling advertisers off is a swift route to accomplishing that.

Experts have proposed that Musk is deliberately causing X to fail in order to bankrupt the company and reduce the substantial amount of money he owes to the group of banks that provided funding for the project at the start.

Could it be possible that Elon Musk's final objective is to go bankrupt, abandon X, and transfer it to Morgan Stanley? That's a possibility. However, it's peculiar to ponder about Morgan Stanley's stance on content moderation, as Blake mentions.

Despite X losing advertisers and value, Musk's other businesses continue to thrive. His Starlink satellite system has gained significant influence in conflict zones, making Musk a dominant force in space. These satellites are essential for accessing the internet in war-torn and distant regions. In fact, the New York Times has identified Starlink as one of the most critical technologies used by Ukraine during the war. The success of Starlink has helped SpaceX's value rise to $140 billion. As a result, despite the challenges faced by X and Musk's reputation taking a hit, his power and influence remain strong.

Kissinger's Legacy: 1923-2023

On Wednesday, Henry Kissinger passed away at the age of 100. He was Richard Nixon's secretary of state and a highly debated figure in American foreign policy during the 20th century. Those who supported him saw him as a fervent defender of American interests, while those who opposed him viewed him as responsible for war crimes.

If you want to gain insight into the extensive life of Kissinger, check out the photo essay on The Guardian. The piece showcases Kissinger alongside numerous global leaders and captures significant moments in history. If you're interested in learning more about his life and professional achievements, The Guardian obituary is a good source. Alternatively, you can watch the video obituary. Meanwhile, Jonathan Wilson's article delves into Kissinger's intriguing connection to the realm of soccer.

If you want a detailed examination of his impact, take a look at Simon Tisdall's article. Tisdall notes that his endorsement of the deadly military takeover in Chile back in 1973 was a representation of America's shortsighted and harmful neo-imperialistic policies during that time. This event resulted in the removal of a democratically elected official, Salvador Allende, and led to the oppressive regime of Augusto Pinochet.

Other Things We've Read

Shane MacGowan should be commemorated for his incredible achievements beyond the popular holiday tune "Fairytale of New York," though his passing at the age of 65 guarantees widespread attention. This article honors the Pogues lead singer with captivating visuals, while countless individuals worldwide express their condolences. To honor his memory, it's an excellent moment to revisit Simon Hattenstone's exquisite feature interview from last year. Toby Moses, the head of newsletters, suggests this to readers.

For years, Andy Bull has been having discussions with rugby players and their loved ones about the life-altering impacts of brain injuries. This touching article emphasizes the need for taking action to alter the sport's policy concerning player protection. Clare Longrigg, who is in charge of newsletters at the moment, has shared this message.

Many people have expressed their condolences for the passing of Alistair Darling, a former chancellor of the Labour party who passed away at the age of 70 yesterday. Larry Elliott spoke about how Darling's political abilities were not fully recognized, and that without his efforts, the financial crisis of 2008 could have been far worse. Toby also paid tribute to Darling.

Cleaning experts reveal their ultimate tips for handling the most dreaded household cleaning tasks, including combating ghastly fridge odors and getting rid of unpleasant "bin juice". This article was written by Clare.

After sick children were given access to Netflix and older viewers were disgusted with the Schofield/Willoughby scandals, what's next for This Morning? Emine Saner consulted with specialists, including the show's originator, to discover where things went amiss. Toby

Liverpool did really well in their football match and got a perfect 10. Their coach, Jürgen Klopp, must be feeling really happy about it. As a result, they managed to win Group E with one game left to play. This means they don't have to worry about going through the playoff round to qualify for the last 16 of the Europa League. They can also relax during their final group game against Union Saint-Gilloise. Brighton also did well and managed to progress to the knockout stages of the Europa League. They weren't fantastic though, as they had a hard time winning against 10-man AEK Athens. João Pedro's second-half penalty was what granted them the victory in the end. Finally, West Ham secured their place in the knockout stages thanks to Tomas Soucek's late goal. It seems that he's becoming quite the hero for his team, scoring important goals when they need them the most.

The head of rugby at Saracens, Mark McCall, has expressed his disapproval of how Owen Farrell was treated and believes it should serve as a warning for the sport to improve. Farrell has made the decision to skip the Six Nations as he wants to focus on his own and his family's mental health, but he will still participate in club rugby. McCall referred to the way Farrell was treated as "shameful."

Valtteri Bottas, a well-known Formula One driver, has managed to generate a whopping $150,000 for the "Movember" charity that helps raise awareness about men's health issues. How, you may ask? By releasing a calendar, titled "Bottass 2024", which features some cheeky pictures of him baring his backside. The calendar was an instant hit, with the first batch of 10,000 copies selling out almost immediately. Each calendar was priced at $5.46, and a portion of this amount will go towards funding research for prostate cancer. Bottas's initiative has managed to raise a significant amount of money for the charity, which is a great achievement.

The summit has been covered in the news, with The Guardian featuring a headline about a deal being made at Cop28 to assist underprivileged countries with managing the effects of climate change. However, the other newspapers have placed their attention on the royal family controversy. The Telegraph's headline discusses the palace's potential legal action against claims of racism within the family, while The Mail's headline focuses on the author's defense unraveling. The Mirror's headline specifically mentions King and Kate's involvement in the race row.

The Covid investigation is being discussed by The Times under the header “Hancock confesses that the delay in the lockdown was a deadly mistake”. Meanwhile, the Financial Times reports that central banks are taking measures to control inflation, resulting in investors flocking towards high-risk assets, which is the headline, “Investors rush towards unsafe assets as they believe rates are unlikely to increase”. Additionally, the i highlights the shadow foreign secretary's remarks, with the heading “Labour party considers EU as a top priority for their foreign policy”.

In the Sun newspaper, the announcement of the passing of Shane MacGowan, the lead singer of the Pogues, is accompanied by the phrase "And the bells are ringing out for...Shane".

Weekend Fun Ahead!

Discover the top picks from our critics for the most enjoyable viewing, reading, and listening at the moment.

The TV show Slow Horses on Apple TV+ is an absolute delight, as always. It's confident, audacious, and unapologetically silly. It revels in the conventions of a standard spy drama, like a happy pig in mud. We get cryptic letters and clandestine meetings, exciting plot twists and hair-raising chase scenes, even if the vehicles involved are more suited for transporting kids than conducting top-secret espionage. But there's also a layer of humble humor that keeps things engaging and novel. It's hilarious and vulgar, yet nerve-wracking and captivating, making for a thoroughly enjoyable and well-crafted spy thriller. In summary, Rebecca Nicholson got it right - it's a top-notch TV show.

Peter Gabriel's latest album, i/o, has been compared to musical masterpieces like the Beach Boys' Smile and Guns N' Roses' Chinese Democracy. The album is intricate and rich, providing a gratifying listening experience. Critics have questioned the decision to release an album with songs that have already been available on streaming platforms. Yet, regardless of the lunar-influenced drip-fed release format, i/o has been thoughtfully crafted as an album meant to be enjoyed in one sitting, with a seamless ebb and flow. Some speculate that this may be Gabriel's final album of original material, especially given the long hiatus since his previous album, Up. Opinion writer Alexis Petridis offers these insights.

The movie Fallen Leaves is playing in cinemas all over the country. Directed by Finnish filmmaker Aki Kaurismäki, it is a charming and enjoyable comedy for movie lovers, complete with catchy rock and roll music. The film has a romantic and kind-hearted tone, and its deadpan humor does not diminish the genuine emotions conveyed. Additionally, it offers insightful commentary on current political issues. Despite the absurd and exaggerated visuals, the movie is ultimately heartwarming and leaves audiences feeling uplifted. These insightful comments were made by film critic Peter Bradshaw.

In the podcast named "The Rest Is Entertainment," which can be found in many places, Richard Osman and Marina Hyde from The Guardian collaborate to deliver a hysterical and engaging summary of the latest happenings in pop culture. Their on-air chemistry is unbeatable and entertaining, with amusing segments covering topics such as Nigel Farage's dull stints on "I'm a Celebrity" and Boris Johnson's soon-to-air "GB News" show that is predicted to be a flop. However, the best part of the show is when they hilariously dissect the Jeff Bezos and Lauren Sánchez interview in Vogue. It's definitely worth a listen!

The past seven days in Israel and Gaza have been marked by emotional reunions and a fragile peace agreement. Israel and Gaza have been at odds for some time now, but the recent ceasefire has allowed families to finally reunite after being separated for several years. These reunions have been emotional and filled with tears of joy. However, the truce between the two sides remains uneasy. Both sides are still cautious and skeptical of each other, with tensions remaining high. Many fear that the agreement will not hold, and violence could resume at any moment. Despite the uncertainty, there is hope that this period of peace will endure, and that the people of Israel and Gaza can finally find a way to coexist peacefully. Time will tell if this dream can become a reality.

This week, there was a temporary halt to the seven-week conflict between Israelis and Hamas in Gaza. The opposing forces came to an agreement on a number of temporary ceasefire deals for the purpose of freeing Israeli hostages and Palestinian prisoners.

Michael Safi was informed by Jason Burke, reporting from Jerusalem on behalf of the Guardian, that families on both sides of the conflict are experiencing moments of happiness as they are reuniting with each other. Due to the ceasefire, aid has been able to reach Gaza, but the severity of the humanitarian crisis is increasing with each passing day. Fidaa Alaraj, a Palestinian woman affiliated with Oxfam working in Gaza, says that everyone she talks to has the same concern: what is our next step?

Today's Cartoon: Ben Jennings

I have some positive news to share with you that serves as a gentle reminder that the world is not entirely negative.

A rare, shimmering golden mole that was suspected to have gone extinct has been found once again. It was spotted "swimming" in the sand by the coastal locality of Port Nolloth in South Africa.

The De Winton's golden mole resides underground and will submerge itself if it senses any approaching footsteps. This mole has not been seen since 1937, and is categorized among the "most wanted" of all the lost species. An extensive two-year hunt by preservationists and their border collie named Jessie, who was specialized in detecting golden moles, led to locating the mole.

Finally, you can have fun all day with the Guardian's puzzles, and if you're looking for even more, check out their Puzzles app for both iOS and Android. That's all until Monday.