The European Commission has declared that Elon Musk's social media company, X, does not qualify as a "gatekeeper" and will not succumb to the many laws imposed against companies designated with this status. All in all, X won its antitrust case in the EU after months of investigation regarding the company, and it was because of its poor ads revenue after losing clients.
Since last year, X has struggled in its ads program primarily because of Musk, who likes to publish controversial posts, causing the so-called "ads exodus" amongst its clients and partners.
X Dodges 'Gatekeeper' Status in the EU as it is Not That 'Big'
The European Commission announced today that after its investigations into X, they have now concluded that the platform, formerly called Twitter, is not a "gatekeeper" under the Digital Markets Act (DMA).
"Following a thorough assessment of all arguments, including input by relevant stakeholders, and after consulting the Digital Markets Advisory Committee, the Commission concluded that X does indeed not qualify as a gatekeeper about its online social networking service, given that the investigation revealed that X is not an important gateway for business users to reach end users," said the European Commission.
This may be a landmark win for X now, but the Commission claimed that it will still keep tabs on the platform regarding future changes or developments which may cause it to reclassify the platform to be a core service.
Poor Ads Revenue Saves the Day for Elon Musk and X
X and the EC's investigation determined that the platform is not a gatekeeper, with one of its top designations having 7.5 billion euros or more in its annual turnover, and this was not achieved by the platform. Recently, X saw struggles with its ad revenue and diminishing user base because of Musk's problematic free speech campaign.
In another filing, it was revealed that it is inferior to its competitors who were given gatekeeper status, like Meta's Facebook and Instagram, Microsoft's LinkedIn and ByteDance's TikTok.
Elon Musk's Issues and X Ads Program
Twitter changed drastically when Musk stepped in, and because of his "free speech" idealism for the platform, many users left the platform for alternatives that are not owned by the tech billionaire. X's numbers toward the end of last year and earlier this 2024 saw it plummet even more, following Musk's antisemitic posts, which caused more users and ad partners to depart.
Musk's controversial claims portraying antisemitism online saw mixed reactions, with some praising the executive and joining him on the matter, while others blasting his behavior and what he presented on X. Various advertisers like Apple, Disney, IBM and more have denounced Musk's antisemitic posts, leading to some pausing their ads or severing ties with X.
However, the multi-tech executive retaliated against this "mass exodus" from advertisers who left the company by filing a lawsuit against them, calling this an "antitrust action" against his social media platform. While this case is yet to make headway, X's poor performance in ads and seeing fewer active users in the platform have significantly helped them in their EU woes, dodging a bullet on being designated as a gatekeeper.
