business news in context, analysis with attitude

With brief, occasional, italicized and sometimes gratuitous commentary…

•  The Information reports that as advertising agencies and brands express concern about Twitter's brand image, pausing campaigns in the wake of Elon Musk's $44 billion acquisition of the company, firing of about half its employees, and use of Tweets to advance controversial positions, the company has experienced "a massive drop in revenue."

Musk is blaming the problem on “activist groups pressuring advertisers."

Some context from The Information:

"Twitter’s revenue was already in decline ahead of the acquisition. The company reported $1.1 billion in revenue for the second quarter, which ended in June. That’s down 1.2% from the same time last year. Across the digital ad market, revenues have slumped with Twitter rivals Google and Facebook reporting sharp slowdowns in the third quarter.

"Musk doubled down on his message that Twitter is the victim of politics, rather than business. 'Extremely messed up! They’re trying to destroy free speech in America,' Musk wrote, just two days after posting a poll mocking advertisers which asked whether they should support 'free speech' or 'political correctness' and less than a week after Musk posted a homophobic misinformation about a violent attack on House Speaker Nancy Pelosi’s husband."

Just to be clear, this is not a free speech issue.  Twitter is a private company, not a government entity, and so the First Amendment does not apply.  At the same time, advertisers have the right to associate with whoever and whatever entities that they think are good for their brands, and from my perspective, the problem is not activist groups, but an unhinged CEO.

However, it needs to be pointed out that not everyone is abandoning Twitter.  Business Insider reports that "Twitter's head of safety and integrity said 300 users posted over 50,000 tweets with a 'particular slur' in 48 hours.  Research showed the use of N-word on Twitter rose by nearly 500% after the takeover deal closed.

"Yoel Roth said Twitter has banned the accounts involved in the trolling campaign."

•  The Information also has a story about how Twitter, having fired half its 7,500 employees last week, "began asking some of the affected staff to return. It’s unclear how many people could be asked to come back, but managers discovered that Twitter laid off some people by mistake and that they needed others to build new features ordered by Musk."

Some of those folks may go back for the paycheck, and some of them are about to get raises because they suddenly have negotiating leverage.  But I have to imagine that a bunch of these folks are going to say "no, thank you," because if you don't need the money, who needs the tsuris?