Elon Musk’s platform, X, recently made headlines by filing a federal antitrust lawsuit against the World Federation of Advertisers (WFA) and several of its prominent members, who are part of an initiative known as the Global Alliance for Responsible Media (GARM).
X’s lawsuit alleges that these parties conspired to collectively withhold significant advertising revenue from the platform. The lawsuit is based on the claim that WFA and its advertising members engaged in actions that were detrimental to X’s financial interests.
In response to the legal challenge, the WFA announced the dissolution of GARM, which was a non-profit organization designed to help its members avoid placing ads on harmful websites.
The WFA stated that the closure was due to the limited resources of GARM and its inability to continue operating amidst the legal battle. Despite GARM’s shutdown, the WFA intends to defend itself against X’s lawsuit, maintaining that it has committed no wrongdoing.
X’s CEO, Linda Yaccarino, expressed her satisfaction with GARM’s dissolution, framing it as a victory for free speech and an opportunity for broader reform in the advertising ecosystem.
She cited a statement from the Republican-led House Judiciary Committee, which viewed the closure as a positive development for First Amendment rights. Yaccarino believes that the dismantling of GARM could lead to necessary changes in how advertising and monetization are managed.
However, Check My Ads, an organization focused on addressing issues related to ad placements on harmful websites, argues that X’s celebration may be premature.
The group suggests that the removal of GARM could lead to more advertisers avoiding X, as they may now have fewer assurances about the platform’s ad safety and reputation. Check My Ads points out that X had recently been reinstated in GARM and had promoted its commitment to brand safety.
While X’s lawsuit led to the dissolution of GARM, which was previously a partner in ensuring responsible ad placements, this move might have adverse effects for X. Check My Ads predicts that the absence of GARM’s endorsement could result in even fewer advertisers willing to associate with X, potentially exacerbating the platform’s struggles to attract and retain ad revenue.