Has Elon Musk sabotaged X going forward? Analysts cite Twitter owner as the biggest liability for the platform.
The fallout from Elon Musk's extraordinary outburst at advertisers on Wednesday continues, as a couple of analysts offered their insights into the controversy.
During an on-stage interview at The New York Times DealBook Summit, Musk had made a rare public apology for recently endorsing an anti-Semetic conspiracy theory.
"I don't want them to advertise," Musk replied.
Musk then doubled down in front of the shocked audience.
Musk's comments against advertisers come as many big name firms are boycotting their spend on his platform due to their ads appearing alongside extremist content.
"Most of our clients for example have not been moved one way or another by Elon Musk's words. They simply care about reaching their audience. As long as their audience is there, they will continue to advertise. That being said, X is not the only game in town and a bigger share of budgets is going to LinkedIn, TikTok and Meta. There is also a trend of moving away from solely paid to earned, owned, and influencer marketing as well."
In a damage control move, X chief executive Linda Yaccarino in a memo to staffers said Musk's interview was "Candid and profound," and encouraged staff to watch it.
Musk also acknowledged on Wednesday that an extended advertising boycott could bankrupt X, and he declined to say whether he would use his personal fortune to save the firm.
Musk instead suggested that the public would blame the brands and not him for a potential collapse.
At least two analysts have disagreed and suggested that it is Musk himself that is X's biggest liability.
"If anyone is killing X, it's Elon Musk - not advertisers," Insider Intelligence analyst Jasmine Enberg told Reuters.
"Should X collapse, an autopsy would reveal a series of platform policy decisions, staffing cuts, tweets and antagonistic comments by Musk that have driven away X's primary source of revenue," Enberg said.
"It's not every day that a prominent business owner tells its revenue suppliers to 'go [expletive] [themselves]," but that's exactly what Elon Musk said to X advertisers yesterday during The New York Times' DealBook Summit - not once but three times," noted Proulx.
"The day Elon Musk announced his intent to acquire Twitter marked the actual beginning of the platform's end," Proulx wrote.
"In the 13 months since Musk took over, the company has been decimated: its brand, its revenue, and its valuation."
"Musk blamed advertisers and their boycott as the reason for what 'is going to kill the company,'" wrote Forrester's Proulx.
"The blame for the state of X lies at the top of the company: Musk's own choices continue to devolve X's business - piece by piece," Proulx concluded.
"His crass message to advertisers will only drive more revenue out the door - revenue that the company needs given the company's heavy debt load. How much more runway Musk gives X is anyone's guess. But if his comments yesterday are an indication of anything, it's that an end for X is in sight."
The Guardian also noted in an analysis piece that before Musk took control of Twitter, it was making a loss but was not heavily indebted, as it is now.
This Cyber News was published on www.silicon.co.uk. Publication date: Fri, 01 Dec 2023 23:06:57 +0000