Elon Musk calls for “criminal prosecution” of X ad boycott perpetrators
Musk is still throwing a tantrum over companies not wanting to advertise alongside the neo-Nazi posts he wants to keep on X. But now he's got Republicans in Congress on his side.Congress accused advertisers group of colluding to tank X's revenue.
ASHLEY BELANGER - 7/12/2024, 9:28 AM
After the House of Representatives Committee on the Judiciary released a report accusing the Global Alliance for Responsible Media (GARM) of colluding with companies to censor conservative voices online, Elon Musk chimed in. In a post on X (formerly Twitter), Musk wrote that X "has no choice but to file suit against the perpetrators and collaborators" behind an advertiser boycott on his platform.
"Hopefully, some states will consider criminal prosecution," Musk wrote, leading several X users to suggest that Musk wants it to be illegal for brands to refuse to advertise on X.
Among other allegations, Congress' report claimed that GARM—which is part of the World Federation of Advertisers (WFA), whose members "represent roughly 90 percent of global advertising spend, or almost one trillion dollars annually"—directed advertisers to boycott Twitter shortly after Musk took over the platform.
"GARM members colluded to cut Twitter’s revenue after Elon Musk’s acquisition," the report said, further alleging that "colluding to suppress voices and views disfavored by the leading marketers at the world’s largest companies and advertising agencies is core to GARM’s founding principles."
Twitter/X's revenue tanked after Musk's takeover, with Bloomberg reporting last month that X lost almost 40 percent of revenue in the first six months of 2023 compared to the same period in 2022. That's worse than prior estimates last May, which put Twitter's loss around one-third of its total valuation. Ars chronicled the worst impacts of the ad boycott, including sharp drop-offs in the US, where an internal Twitter presentation leaked to The New York Times showed Twitter's ad revenue was down by as much as 59 percent "for the five weeks from April 1 to the first week of May" in 2023.
Last year, Musk sued other "collaborators" in the X boycott, including hate speech researchers, the Center for Countering Digital Hate (CCDH) and Media Matters for America (MMFA). However, his suit against the CCDH was dismissed this March, and Media Matters has claimed that Musk filing his MMFA lawsuit in Texas may be "fatal" because of a jurisdictional defect.
Now, it seems that Musk could be considering suing GARM next. Although his post does not mention GARM, it quotes a post sharing Congressional testimony from The Daily Wire's Ben Shapiro. As Shapiro sees it, GARM's censorship standards are allegedly too high because "GARM doesn't draw the line at what is criminal, abusive, or dangerous." It also restricts "hate speech, harassment, misinformation," and "insensitive, irresponsible, and harmful treatment of debated, sensitive social issues," such as misgendering.
X had previously severed ties with GARM, but just renewed its membership July 1. In a post on X, the platform's Safety account said, "We’re excited to announce that X has reinstated our relationship" with GARM. "X is committed to the safety of our global town square and proud to be part of the GARM community!"
As of this writing, X is still listed as a GARM member, which was a move publicly supported by X CEO Linda Yaccarino, who reposted the Support team's post on her X account. There is no telling yet if Yaccarino's seeming support of GARM may strain her relationship with Musk, who has parted ways with several X executives during his reign over content moderation conflicts.
The Committee on the Judiciary reported that GARM may be violating the Sherman Act, which "makes unreasonable restraints of trade illegal," including certain cases when "group boycotts and coordinated actions" harm consumers.
GARM allegedly harmed consumers by wielding its "tremendous market power in the advertising industry" and "eliminating a variety of content and viewpoints available to consumers." This allegedly worked to "rob consumers of choices" and "is likely illegal under the antitrust laws," in addition to threatening "fundamental American freedoms," the committee's report said.
According to the report, "the high market share of GARM and its members in advertising campaigns and spending, combined with the direct evidence of demonetizing certain viewpoints to limit consumer choice," allegedly "meet the initial burden of demonstrating harm to consumers."
"The information uncovered to date of WFA and GARM’s collusive conduct to demonetize disfavored content is alarming," the committee concluded, vowing to "continue its investigation into the companies that participate in this conduct to inform potential legislative reforms."
GARM’s response to Congress’ report
GARM told Ars that it "has continually demonstrated that it will cooperate with the House Judiciary Committee in good faith."
The committee's report "does not include the 168-page transcribed interview which effectively clarifies questions on GARM’s adherence to competition law policy and practices, that GARM is a voluntary organization, and that guidance from GARM is non-binding," GARM said.
"We remain steadfast in the conviction that GARM enhances transparency in previously opaque practices relative to ad placements in digital social media," GARM said. "GARM creates voluntary industry standards on brand safety and suitability which media sellers and ad tech companies can voluntarily adopt, adapt or reject. This in turn allows advertisers to make choices similar to the way they buy advertising in TV, print or radio. GARM’s work focuses on voluntary monetization standards while establishing voluntary steps to improve transparency on content moderation and platform design."
GARM confirmed that it will continue to cooperate with the House committee as it continues its investigation but denied allegations of misconduct raised against GARM and WFA.
"In consultation with legal counsel, WFA maintains robust and effective compliance policies designed to enhance competition," GARM told Ars. "These policies, along with other materials and information provided to the House Judiciary Committee corroborates that GARM has been diligent in always driving a voluntary and pro-competitive approach and that the allegations against GARM for anti-competitive behavior are baseless."
X recently rejoined GARM
When Musk first named Yaccarino as CEO, right-wing Twitter users expressed fears that she might return Twitter to its enthusiastic content moderation roots rather than support Musk's vision of allowing all legal speech on his platform, The Washington Post reported. Those users fretted that "Yaccarino is an executive chair of the World Economic Forum, an organization they view as one of the roots of all evil in the world," BBC journalist Shayan Sardarizadeh tweeted at the time.
This week, some X users revived those claims, joking that Musk may have to sue Yaccarino among "collaborators" in the boycott due to her ties with the World Economic Forum (WEF) and support for GARM, which is a flagship partner of WEF.
Yaccarino has spent much of her tenure as CEO wooing back advertisers spooked off by reported spikes in hate speech on Twitter, as well as a tweet from Musk condemned by the White House as antisemitic. The controversy reached a boiling point when Musk told advertisers to "go f*ck yourselves," a comment which Musk has recently attempted to walk back, The Hill reported last month.
However, Yaccarino did not seem to be pushing for X to rejoin GARM until recently, and it's unclear how X's content moderation practices may have changed since renewing its membership.
Previously when Twitter was a GARM member, it made several commitments regarding brand safety, a 2022 GARM blog detailed. Among these commitments, Twitter said that it would adopt GARM metrics to flag harmful content that should not be monetized and increase transparency to help GARM assess "platform safety and advertising suitability." Twitter also agreed to "regularly report on the prevalence and reach of harmful content on the platform to ensure that the platform is safe for consumers."
It's possible that X might take similar steps as a current GARM member, but Ars could not immediately reach X for comment.
Congress: It’s not illegal to boycott X
In the House committee's report, lawmakers clarified that each advertiser "could legally choose to independently withhold advertising from any platform or news outlet it chooses."
However, a single brand boycotting X wouldn't have the impact that GARM allegedly sought, Congress claimed. "What these corporations could not achieve unilaterally" to "silence conservative views," they "have worked extensively since 2019 to achieve by coordinating through GARM," the report alleged.
Even if GARM has "good intentions" in advising brands to hold off on X advertising, "federal antitrust laws do not diminish," lawmakers claimed.
If antitrust law doesn't apply in this case, legal reforms may be necessary to intervene between GARM and online platforms, Congress wrote, alleging that "GARM has no intention of limiting its censorship to existing technologies."
Lawmakers' biggest fear is that GARM's alleged overreach will be amplified by applying its strict monetization standards through "technologies in their infancy such as generative AI and the metaverse."
"GARM’s partners are developing AI tools that will integrate GARM’s standards seamlessly across social media platforms," the committee's report warned. "Such an automated censorship effort could result in the demonetization of any views or voices that GARM’s advertising cartel dislikes, potentially without any human involvement at all. Such concentrated market power is dangerous, and the implications of AI technology on advertising censorship are frightening."
In the transcript of GARM co-founder Rob Rakowitz's testimony to the House committee reviewed by Ars, Rakowitz said GARM "brings together marketers, agencies, platforms, and industry groups to remove advertising support from harmful content in digital social media" and has "strict processes in place to ensure that we comply with relevant antitrust laws."
"Our goal is to create more transparency and competitiveness in the marketplace by developing voluntary industry standards through an inclusive and open process," Rakowitz said. "GARM is apolitical in its work and our membership approach is nondiscriminatory. We are not a watchdog. We are not a lobby. We do not boycott, and we do not collude."
Statistics: Posted by bilateralrope — 2024-07-12 01:56am