Apple stopping its ad-spends on Twitter is a big concern for Elon Musk

Apple stopping its ad-spends on Twitter is a big concern for Elon Musk

Twitter, like most social media platforms, heavily relies on advertisers to generate revenue, However, unlike other social media platforms, Twitter has lost a significant number of advertisers ever since Elon Musk took over. With Apple suspending most of its ad-spending on the platform, Elon Musk surely must be worried.

Apple stopping its ad spends on Twitter is a big concern for Elon Musk

Ever since Musk took over, Twitter has lost nearly 50 of its top 100 advertisers on the platform. Up until a week ago, about a third of Twitter’s top 100 advertisers had not advertised on the platform for over two weeks.

While the looming recession and economic churn that certain tech companies like Amazon, Meta, Google and Microsoft are facing, maybe a reason why brands are reducing their ad-spends and marketing budgets across social media platforms, the fact that Twitter has become so volatile is particularly concerning for brands and people who manage their brand’s ad-spending on Twitter.

The reason why Musk is singling out Apple is manifold. First, Apple on average spends about $100 million every year, easily on Twitter alone. In the first quarter of this year, Apple spent $48 million in ads on the platform, as per a report by The Washington Post. Seeing one of the biggest advertisers pulling out of Twitter is surely going to cause other advertisers to pull out as well. Or, they might be in a position to leverage Apple’s decision to quit to get a better deal.

The other reason why Musk is calling out Apple is the commission that Apple charges for each transaction that goes through the App Store. Apple and Google both charge a fee for enabling transactions through their respective app stores. Apple in particular, has a practice of charging 30 per cent on each transaction if the app generates revenue of $1 million. When you consider Musk’s plan to monetise various aspects of Twitter, that 30 per cent commission surely ads up. Although this isn’t something new, Musk calling it a “secret” Apple tax, shows how the disdain that he has for the practice. 

Finally, there is the fact that Apple has threatened to pull Twitter off of its App Store. Apple has a set of regulations that app developers have to follow so that they can be listed on Apple’s App Store. Musk’s recent actions regarding content moderation on Twitter, and the reinstatement of accounts that were previously banned for hate speech violate a number of terms and conditions that Apple has for apps on its App Store

While advertisers and brands have been cautious of Musk’s idea of how Twitter should function, they were warming up to the idea. However, seeing Apple, possibly the biggest tech company in the world pulling out of Twitter and then banning the app from the App Store is surely going to jolt up brands who were contemplating resuming their ad-spends on the platform.

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