This is an unexpected victory for Elon Musk and Twitter.
Less than three months after completing the acquisition of Twitter for $44 billion, the serial entrepreneur may finally have his biggest victory: the commitment of big sports advertisers with the sustainability of juicy contracts.
The microblogging website has reached agreements with major advertisers to continue promoting their services, events and products on the platform, reports Axios.
Almost all the major sports leagues in the United States -- NFL, NBA, MLB, NHL, NASCAR, PGA Tour -- have decided to continue broadcasting content on the social network. This content will revolve around the promotion of their games and related events.
For example, expect the NCAA to commercialize March Madness, the NBA to promote the playoffs, and the NFL to overwhelm Twitter users with ads around the Super Bowl.
'The Party Is On'
Apart from the major sports leagues, major broadcasters of sporting events such as Turner sports with its TNT and TBS channels, ESPN, FOX, Univision and Telemundo also plan to continue to communicate on Twitter around these sporting events which often constitute the bulk of their best audiences.
Musk seemed to confirm this information by retweeting and commenting on the Axios article with a: "The party is on".
"The party is on!! 🚀 💫 ♥️," the billionaire wrote on Twitter.
This information is a huge relief for the billionaire and Twitter, 91% of whose income was generated from advertising revenue in the second quarter of 2022, the last period for which the earnings are public. The company, which was delisted after the Musk deal, went private. Consequently, it is no longer obliged to publish its financial results.
Musk's early days as owner of Twitter were marked by an exodus of advertisers, most of whom had paused their ads for brand security reasons. They said they wanted to see what direction the tycoon intended to give to the platform which he wants to make the stronghold of conservatives.
These advertisers were particularly worried by Musk's decision to reactivate accounts banned by Twitter 1.0, including that of former President Donald Trump, for violations of the firm's safeguards against xenophobia, racism, Covid-19, anti-Semitism and misinformation.
News Outlets Stay on Twitter
Brands were worried Twitter will become a "hellscape," because the billionaire, who defines himself as a free-speech absolutist, believes that any message is acceptable on the platform as long as it does not violate the law. For many advertisers, Musk's laissez-faire approach risks spouting hate and xenophobia on the platform, a risk they don't want to take, having their brands associated with such messaging.
This exodus of advertisers had completely weakened the financial health of the firm.
"Twitter isn’t secure yet, just not in the fast lane to bankruptcy," the serial entrepreneur said on December 24. "Still much work to do."
He previously warned last November that Twitter was "losing over $4M/day."
He reiterated that pessimistic view during a Twitter Spaces on Dec. 20. He said that the platform was on track to hit $3 billion in negative cash flow before the drastic cost cuts he made. Of the company's 7,500 employees who were on staff when he arrived, at least 5,000 have been fired or left.
Musk, who personally went into debt to the tune of $13 billion to finance the Twitter deal, launched an austerity cure. These cost reductions and the relaunch of the Twitter Blue subscription service were not enough to make the platform profitable, according to many experts. That's why a return of sports advertisers is a big win for Musk as it could persuade other advertisers in other industries to come back.
In addition to sports, media groups such as NBCU, Paramount and Disney also plan to promote themselves on Twitter around events such as awards shows, concerts, prime-time shows and very popular TV shows like "The Bachelor" on Disney's ABC, "RuPaul's Drag Race" on Paramount's MTV and "The Masked Singer" on FOX, Axios reports.
Media such as the Wall Street Journal, Reuters, Axios, Bloomberg, Forbes, Conde Nast and USA Today also plan to continue to have a presence on Twitter and highlight their coverage of key events with which they are partners, adds the news outlet.
"Companies in general are missing the incredible opportunity that Twitter provides to reach customers," Musk said on January 17. "Just Tweet interesting things! That’s all it takes."
