Chaos days continue
Fake tweet costs Musk many millions of dollars
By Jan Ganger
11/15/2022, 1:11 p.m
Twitter doesn’t rest. While the new boss Elon Musk wants to drive users into a subscription model, advertisers are running away. Now it’s enough for the pharmaceutical company Eli Lilly.
A short tweet is really expensive for Elon Musk. “We’re excited to announce that insulin is now free,” tweeted an account sporting the logo of pharmaceutical giant Eli Lilly. The tweet triggered a huge response and, according to the Washington Post, caused real panic among Eli Lilly. Because the eagerly shared message was not true.
The Twitter account was adorned with a verification tick, which for years confirmed the authenticity of the accounts of celebrities, politicians and companies on the social network. But then Musk took over Twitter and, almost overnight, introduced a new way of making money from it. His idea: Anyone who takes out a subscription for eight dollars a month gets a tick – without an identity check. This icon looks the same as on official verified accounts. It is only when you click on it that you can see whether the tick is only there because the user paid for it.
What had to happen happened. Suddenly, Twitter was flooded with fake celebrity and corporate accounts adorned with blue verification ticks. An account allegedly used by Chiquita announced that the company had overthrown the Brazilian government.
When the insulin tweet went viral, those in charge of the $338 billion pharmaceutical company tried to reach someone on Twitter to have the fake tweet deleted. Eli Lilly feared damage to his image and thought it possible that false information could be spread via the account, putting patients at risk.
However, according to the Washington Post, Twitter did not respond for hours. Shortly after the $44 billion takeover, Musk had half of the employees fired by email to save costs. Eli Lilly apologized to his approximately 130,000 followers for the fake, which only disappeared much later.
Eli Lilly keeps his distance
The company, with annual sales of more than 28 billion dollars, then took action and announced that it would immediately put advertising on Twitter on hold. Eli Lilly did not say how much money the company spends on Twitter. According to estimates, the social network will probably have to forego several million dollars in revenue. The pharmaceutical giant spends around 100 million dollars a year on TV advertising and digital campaigns in the USA alone.
This is bad news for Musk. Because before Eli Lilly, many large companies distanced themselves from Twitter and stopped their advertising activities there. They fear that hate speech and disinformation will increase under Musk’s leadership and no longer want to book advertising in such an environment.
Twitter is heavily reliant on advertising revenue. This was exacerbated by the acquisition, with Musk offloading $13 billion in loans to Twitter. The debt service alone costs the non-profitable company around one billion dollars a year.
Meanwhile, Musk is threatening Twitter’s bankruptcy and threatening a “thermonuclear” response to the breakaway companies. This is more likely to reinforce their decision than to persuade them to return. The step is not difficult for them because Twitter plays a comparatively small role in online advertising. The lion’s share of the budget goes to Facebook and Google.