Musk blames ‘activist groups’ for major advertisers pausing spending on Twitter

Major advertisers are pausing their campaigns on the social network because of mass layoffs at the site. Musk blamed a drop in revenue on activist groups pressuring advertisers, likely referring to an open letter sent Tuesday by civil society organizations urging advertisers to suspend their ads if Musk didn't commit to enforcing safety standards.

Musk claimed that there had been no change with the moderation of content on the social networking site. There is a different story to be told.

Twitter has had a massive drop in revenue, due to activist groups pressuring advertisers, even though nothing has changed with content moderation and we did everything we could to appease the activists.

Extremely messed up! They’re trying to destroy free speech in America.

— Elon Musk (@elonmusk) November 4, 2022

Sarah Personette resigned from the company late last week. Workers cited concerns about misinformation ahead of the U.S. midterm elections as the reason for the shut-off of employee access to certain moderation tools. Musk agreed to give back access to the tools. The curation team, which was responsible for providing factual context to the conversations on the platform, was eliminated as a result of the layoffs.

According to the Wall Street Journal, General Mills, Audi and Pfizer have stopped running their social media ads. GM was the first brand to announce a pause. Mondelez and Volkswagen are reexamining their ad spend with the network, reportedly spooked by the departure of top executives over the past week.

Mondelez, whose brands include Ritz, Chips Ahoy!, Trident and Tate's Bake Shop, is one of the largest advertisers on the social networking site. The platform's bottom line is likely to be impacted by the fact that ad sales accounted for more than 70% of the platform's revenue in the second quarter.

According to a New York Times report, one of the world's largest advertising companies, with customers such as Coca-Cola, American Express, Johnson & Johnson, and Mattel, issued a recommendation for clients to temporarily pause their spending on social media because of moderation concerns. The Global Alliance for Responsible Media is a coalition of platforms, advertisers and industry groups fighting harmful content on social media.

An open letter to advertisers was published by Musk and he also announced plans to form a council to advise on moderation. According to the Wall Street Journal, Musk has participated in video calls with ad companies in recent days in which he promised to add community management tools and give advertisers the ability to choose which content to be near.

Musk has no choice but to support the company. The deal to buy the company included taking on $13 billion in debt from banks, which means the social network will owe $1 billion a year in interest.