San Francisco, May 4: Twitter has acknowledged for the first time that its core advertising business could be at risk amid the $44 billion takeover by Elon Musk, along with losing key staff during the process.
In a new filing with the US Securities and Exchange Commission (SEC), the micro-blogging platform said it is exposed to new risks related to its “business relationships, financial condition, operating results, cash flows and business,” including “whether advertisers continue their spending on our platform.” Musk’s ‘free speech’ call has left Twitter advertisers worried as this could put their brands next to posts filled with hatred and bias.
Twitter said in the new US SEC filing that it continues to generate the “substantial majority of our revenue from advertising” and the loss could harm the business, reports TechCrunch. If its reputation among advertisers declined, it may be less competitive, said the company. Twitter’s Edit Button First Glimpse Revealed, Here’s How It Will Work.
“We believe that our ability to compete effectively for advertiser spend depends upon many factors, including ‘our reputation and the strength of our brand relative to our competitors, including advertisers’ perception of the health and safety of our platform,” Twitter explained.
There are also fears of mass exodus at Twitter once Musk takes over, as he has lined up new executives to join the platform, including a new CEO. Twitter last month reached out to its advertisers, reassuring them that Musk’s position as a ‘free speech absolutist’ and other threats to drastically rejig the platform won’t put the brands in bad light.
According to reports Twitter contacted advertising agencies, including campaigners and car manufacturers, to reassure them that Musk’s plans won’t make the platform an inhospitable place for brands. Twitter under Parag Agrawal fears that Musk’s ‘free speech’ agenda can hurt its $4.5 billion a year advertising business. Twitter Bans 2 Right-Wing Accounts as Elon Musk Promotes Free Speech.
Advertisers are having nightmares as free speech can hamper their prospects on the platform as their brand’s name may appear alongside hate speech and abusive or dangerous content without moderation.
(The above story first appeared on Morning Tidings on May 04, 2022 11:51 AM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website morningtidings.com).
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