Elon Musk Seems Really, Deeply Committed To Making Sure The FTC Has More To Investigate

From very early on in Elon Musk's ownership of exTwitter a few things became clear regarding his understanding of the FTC. First, he clearly had no idea that the company has a consent decree with the FTC (the kind of thing you learn about during due diligence, which he waived in the purchasing process) and once he learned about it, he assumed he could just ignore it.

Currently, Musk is fighting with the FTC to try to stymie their investigation, claiming (ridiculously) that the FTC's consent decree doesn't really apply to him and also that the current investigation is politically motivated, and not because he's been publicly ignoring everything the company agreed to in the latest version of the consent decree. In response, the US government has had to point out that there are all sorts of reasons why this investigation is happening because Musk continually seems to put user data at risk, with little concern about the impact of his action (which is par for the course for Musk, who seems to assume that putting others at risk is the best way to do business).

Of course, now there's one more thing for the FTC to investigate. Last week, people started noticing that there was a new format of ads on exTwitter, and they appear to violate some fairly basic FTC guidelines regarding making sure users know they're seeing sponsored content. Traditional exTwitter ads look and act more or less like regular tweets, but have a notification that they are sponsored ads or promoted" content. You can still respond to them, retweet them, or even block the user.

However, the new ad units... have none of that.

Multiple X users have reached out to Mashable over the past few days to report seeing a new type of ad in their For You feed that they had not previously come across on the platform. These new X ads don't allow users to like or retweet the ad posts. In fact, the new ad format also doesn't disclose who is behind the ad or that it is even an advertisement at all.

Mashable has confirmed this ad format with numerous users from across X and have seen a variety of different ads running this bizarre new format that just consists of written copy text, a photo, and a fake avatar that's sole purpose is to make the ad look like an organically posted tweet.

And exTwitter is certainly allowed to remove the ability to treat ads like tweets, and take away the blocking/replying/etc features. But what they really can't do (because no one can do this without violating some FTC rules) is hide the fact that they're ads.

This isn't some new thing either. The FTC's power to go after unfair and deceptive practices has been in place for ages, and they've made it clear that this applies to the lack of disclosures for digital ads many, many, many times.

It sounds like these ads are not being run through exTwitter's usual ad engine, but rather the company signed up with a chumbox provider. If you're unfamiliar with chumboxes, we've written about them before (to tell you why Techdirt won't use them, even though the companies reach out to us daily, and we've heard from other publishers that they're actually surprisingly lucrative). They're often seen at the end of news articles and promote extremely clickbaity headlines saying things like the secret energy companies don't want you to know" or the one trick to losing weight."

They're awful.

And now they're on exTwitter.

And they're appearing without the required disclosures.

Given the entirely new format, one hopes that the lack of disclosure is simply an oversight (which is the most likely situation), but that doesn't necessarily mean the FTC will simply give them a pass for it, as it's still likely to be considered deceptive.

It seems clear that exTwitter is getting pretty desperate for ad revenue since its own ad revenue is in free fall, almost entirely because of ridiculous actions by Elon. In the past, Elon insisted that he hated ads (which, you know, is not a bad thing), and he wanted to diversify exTwitter's revenue (which is also a good idea). But then he YOLOd the whole process by pissing off a huge percentage of the company's advertisers while his grand revenue scheme to charge users has been a complete and utter disaster.

Also, just before the chumboxes showed up, exTwitter also cut a deal with Google to have Google sell some of its ad space as well. Basically, Elon has dismantled what had been a decent internal ads system, driving away 60% of the revenue almost entirely because of the terrible shit he did that puts brands at risk, and has been forced to sign up with the bottom feeder ad companies to try to generate something (anything) to bring in some ad revenue (while only making the experience of using the platform worse).

And whatever they bring in may just end up going to lawyers who will be needed to respond to the FTC's investigation of how these ads are presented.