Good morning.
Just over a year after Elon Musk acquired X, formerly Twitter, for $44bn, the company finds itself in a state of disrepair. There are 5,500 fewer employees, cashflow remains negative and the company is now worth $19bn – a 55% drop in value in just 12 months. To make matters worse for Musk and X, the social media company could lose as much as $75m in advertising revenue by the end of the year. 200 companies, including giants like Disney and Apple, paused ad spending on the social media platform after Musk endorsed a tweet that accused Jewish communities of pushing “hatred against whites that they claim to want people to stop using against them”. Musk responded to the user with: “You have said the actual truth.” The monitoring organisation Media Matters then published a report showing ads from big brands appearing next to posts promoting antisemitic and white nationalist content. Musk has responded by suing the watchdog.
The backlash to his endorsement was swift and severe. Musk himself admitted that if the boycott continues, it could bankrupt the company. Perhaps unsurprisingly, despite apologising for the remark and meeting with Israel’s prime minister Benjamin Netanyahu, Musk does not seem to have become more mindful or cautious about his approach to business. Instead, on Wednesday he told advertisers to “go fuck yourselves” during an on-stage interview with a bemused Andrew Ross Sorkin at the New York Times’ DealBook Summit. In an outburst surprising even for the mercurial Musk, he called the boycott “blackmail” and goaded the 200-odd companies by telling them: “Don’t advertise” with X.
In the video – viewed by millions, according to X’s metrics – Musk appears petulant, giving an “I didn’t even want you anyway” energy to Disney, IBM and others he felt rejected by. The performance is characteristic of Musk’s combative approach to business.
So, what does this mean for X? And can Musk come back from this? To answer these questions, I spoke with the Guardian’s US technology editor, Blake Montgomery. That’s right after the headlines.
Five big stories
Israel-Hamas war | The Israeli military has resumed its offensive against Hamas in Gaza, claiming Hamas had violated the truce. “Hamas violated the operational pause, and in addition, fired toward Israeli territory,” the Israeli military said in a post on X early Friday. The Shehab news agency, which is considered close to Hamas, also reported that explosions and gunfire could be heard in northern Gaza.
Cop28 | Rishi Sunak has been accused of sending out the wrong signals on tackling the climate emergency as he heads to the Cop28 summit in Dubai after saying his revised net zero targets show he is “not in hock to the ideological zealots”.
Inflation | The boss of Iceland has hit out at “exploitation” of new parents and joined calls for a price cap on baby formula after the competition watchdog found evidence of greedflation by leading manufacturers.
Strikes | Another nine days of disruption for rail passengers has begun as train drivers in the Aslef union start an overtime ban and a series of rolling strikes halting services across Britain, in a long-running dispute over pay.
Monarchy | A royal author has said an investigation is under way into how the Dutch version of his new book named two senior members of the British royal family alleged to have discussed the skin colour of the Duke and Duchess of Sussex’s unborn son.
In depth: ‘Competitors think it’s going extremely poorly. I would say they’re correct’
As with so many of Musk’s pronouncements, no one really knows why he said what he said. But over the years Musk has cultivated a reputation as an antagonistic “tech genius” who can do what he wants because his products are the best. In the interview with Sorkin, Musk says that Tesla “has done more to help the environment than all other companies combined”, significantly outdoing the competition in sales. Blake posits that he is using a similar technique with Twitter: “The difference is that Twitter is not the best technology. In fact it’s famously really unruly and doesn’t seem to be quite as technically robust or financially lucrative as products made by Meta, Google, Amazon or Apple.”
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How is Twitter doing now?
When I asked Blake how he thought X was doing as a company, he simply put his thumb down. “That’s the short answer,” he says.
X is facing fiercer competition than ever, with more social media platforms releasing similar products. Meta’s Threads surpassed 100m downloads in the week it launched, and it now has 137 million users. “Competitors smell blood in the water,” Blake says bluntly. “Other companies see a real opportunity where they didn’t before and that began after Musk’s acquisition, which tells you a lot about what his contemporaries think of his own ownership of X. They think it’s bad and that it’s going extremely poorly. I would say they’re correct.”
This problem did not begin last week either. In July, Musk disclosed that there had been a 50% drop in advertising revenue and X had a “heavy debt load”, despite hopes in March that X could be cash flow positive by June.
Even hiring Linda Yaccarino, a former NBCUniversal advertising executive with a formidable reputation and deep connections, as CEO has not been able to calm advertiser fears or manage Musk’s erratic behaviour. If anything, Musk’s crumbling reputation has rubbed off on her, with marketing leaders reportedly urging Yaccarino to resign.
It’s not just advertiser boycotts – a number of major brands have stopped posting on the social media platform altogether.
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Can Twitter recover from this downward spiral?
Even before Musk’s acquisition of X, users complained that their experience on the platform was getting gradually worse. But people kept using it and somehow it has managed to avoid going under. “People’s assessment of Twitter or X has been wrong in the past – it could rebound again in some way. Right now, that does not look very likely,” Blake says.
The other option for the platform is bankruptcy. After his initial bid, Musk did not seem to want to buy X. He was legally forced into paying for it and was saddled with an unprofitable $44bn “albatross”. “A lot of tech reporters believe he is trying to file for bankruptcy as soon as possible and telling advertisers to go fuck themselves is a pretty fast way to get on that track,” Blake adds.
Analysts have suggested that Musk is driving X into the ground both to force the company into bankruptcy and minimise the millions of dollars in interest he has to pay to the consortium of banks that helped finance the deal initially.
“Is it that Elon Musk’s ultimate goal is to file for bankruptcy, wash his hands of X and give it to Morgan Stanley? Maybe. Then we have to figure out what Morgan Stanley thinks about content moderation, which is a really bizarre thought,” Blake adds.
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Musk’s enduring influence
Even with X haemorrhaging advertisers and value, Musk’s other companies are doing fine. Musk’s Starlink satellite system has become a new force, shoring up significant influence over conflict zones and making the billionaire the dominant force in space. Starlink satellites are often the only way to get internet access in war zones and remote areas. It has even been one of the “most consequential technologies for Ukraine in the war” according to the New York Times. The technology has pushed the value of SpaceX to $140bn. So, even as the value of X tumbles and his reputation momentarily takes a series of hits, Musk’s power and influence remains largely intact.
Henry Kissinger, 1923-2023: the legacy
Henry Kissinger, Richard Nixon’s secretary of state and the most controversial figure in American foreign policy in the 20th century, died on Wednesday at the age of 100. To his supporters, he was an ardent champion of US interests; to his critics, he was a war criminal.
You can get a sense of his remarkably long life in this Guardian picture essay, which depicts Kissinger with countless world leaders and in various historical moments. For more information on his life and career, read his Guardian obituary or watch this video obituary, and Jonathan Wilson has written an interesting article on Kissinger’s curious links to the world of football.
For a nuanced analysis of his legacy, read Simon Tisdall’s piece: “His support for the murderous military coup in Chile in 1973 that overthrew the elected government of Salvador Allende, and ushered in the dictatorship of Augusto Pinochet, still stands out as a dreadful monument to the myopic, destructive American neo-imperialism of that era”.
What else we’ve been reading
Shane MacGowan deserves to be remembered for so much more than Fairytale of New York, but the Christmas staple has ensured that news of his death at 65 is sure to reverberate around the world. The Pogues frontman is remembered here by Alexis Petridis, his life celebrated in pictures, with tributes pouring in from across the world – and now is a great time to dive back in to Simon Hattenstone’s glorious interview with him last year. Toby Moses, head of newsletters
Andy Bull has been speaking to rugby players and their families about the life-changing effects of brain injuries for years, and this moving piece makes the case for action to change the sport’s policy on protecting players. Clare Longrigg, acting head of newsletters
Tributes have flooded in for former Labour chancellor Alistair Darling, who died aged 70 yesterday. Larry Elliott remembers him as an “underrated” politician, without whom the financial crisis of 2008 could have been so much worse. Toby
Cleaners share their top hacks for the worst household chores, from tackling fridge monsters to banishing “bin juice”. Clare
Now that sick children have Netflix and older viewers have got the ick from various Schofield/Willoughby debacles, what next for This Morning? Emine Saner has talked to experts, including the show’s creator, to find out where it all went wrong. Toby
Sport
Football | A perfect 10 for Liverpool and the perfect night for Jürgen Klopp. His team won Group E with a game to spare to avoid the playoff route into the last 16 of the Europa League and release any pressure from the group finale away at Union Saint-Gilloise. Brighton secured a place in the knockout stages of the Europa League after João Pedro’s second-half penalty earned an unconvincing victory against 10-man AEK Athens. And Tomas Soucek struck late on yet again as West Ham secured their passage into the knockout stages.
Rugby | Saracens director of rugby Mark McCall has criticised the “shameful” treatment of Owen Farrell in what he believes should be a wake-up call for the game. Farrell will miss the Six Nations after deciding to take a break from international rugby in order to “prioritise his and his family’s mental wellbeing”, although he will continue to play club rugby.
Formula One | Formula One driver Valtteri Bottas has raised $150,000 for men’s health charity Movember after a “Bottass 2024” calendar featuring photographs of him baring his backside sped off the shelves. An initial run of 10,000, with $5.46 from each going to prostate cancer research, swiftly sold out before more were printed.
The front pages
The Guardian’s headline is “Deal agreed at Cop28 to help poor countries cope with climate crisis” as the paper kicks off its coverage of the summit. Many of the other papers are focused on the royal controversy. The Telegraph headlines with “Palace to look at legal action over ‘racist royals’ claim”. The Mail says “Scobie’s defence unravels” referring to the author of the book at the centre of the claims. In the Mirror it’s “King and Kate in race row”.
The Times looks at the Covid inquiry with the headline “Lockdown delay was fatal mistake, admits Hancock”. In the Financial Times the headline is “Investors rush for risky assets in belief rate rises are over” as it reports on central banks and their moves on curbing inflation. The i looks at comments by the shadow foreign secretary with the headline “Labour: EU will be our number one priority for UK foreign policy”.
And in the Sun, it’s “And the bells are ringing out for … Shane” as the paper reports on the death of the Pogues frontman, Shane MacGowan.
Something for the weekend
Our critics’ roundup of the best things to watch, read and listen to right now
TV
Slow Horses (Apple TV+)
As always, Slow Horses is a pleasure. It’s big, bold and unapologetically daft. It wallows in the traditions of a regular spy drama like a pig in muck. There are anonymous letters and secret meetings. There are plenty of big twists and loads of chase sequences, even if they are carried out in vehicles that are more practical for the school run than high-stakes secret service stuff. Yet there’s a layer of self-deprecation that keeps it lively and fresh. It is funny and crude, but tense and gripping, and as such, it is a roundly entertaining, solid spy thriller. Rebecca Nicholson
Music
Peter Gabriel: i/o
Peter Gabriel’s tenth studio album of original material has been compared to both the Beach Boys’ Smile and Guns N’ Roses’ Chinese Democracy. It’s dense and rewarding. Anyone wondering at the wisdom of releasing an album consisting of songs already freely available to stream might note that, lunar-influenced drip-fed release or not, it’s clearly been conceived as an album: listened to in one sitting, it ebbs and flows beautifully. And given the size of the gap that separates i/o from Up, it’s tempting to wonder something else: whether it might be Gabriel’s last album of original material. Alexis Petridis
Film
Fallen Leaves (cinemas nationwide)
Fallen Leaves is another of Finnish director Aki Kaurismäki’s beguiling and delightful cinephile comedies, featuring foot-tapping rock’n’roll. It’s romantic and sweet-natured, in a deadpan style that in no way undermines or ironises the emotions involved and with some sharp things to say about contemporary politics. It is a film with a big heart, and absurd and cartoony as it may be, it fills you with a feelgood glow. Peter Bradshaw
Podcast
The Rest Is Entertainment (widely available)
Richard Osman and the Guardian’s Marina Hyde team up for a chemistry-fuelled take on the week’s pop culture – and it is absolutely priceless. Laugh-out-loud moments come from takes on Nigel Farage’s tedious I’m a Celebrity appearances and disastrous predictions for Boris Johnson’s upcoming GB News show. The highlight is the riotously funny takedown of the Vogue interview with Jeff Bezos and Lauren Sánchez. Alexi Duggins
Today in Focus
Israel-Gaza: a week of tearful reunions and an uneasy truce
The seven-week war between Israel and Hamas in Gaza was put on pause this week as the two sides agreed a series of temporary truce agreements to allow for the release of Israeli hostages and Palestinian prisoners.
As the Guardian’s Jason Burke in Jerusalem tells Michael Safi, there have been scenes of joy as families are reunited on both sides of the conflict. The pause in fighting has allowed aid supplies to further trickle into Gaza but the humanitarian crisis grows more grave by the day. Fidaa Alaraj, a Palestinian woman who works with Oxfam in Gaza, tells us that the one question for everyone she speaks to is the same: what do we do now?
Cartoon of the day | Ben Jennings
The Upside
A bit of good news to remind you that the world’s not all bad
An elusive, iridescent golden mole feared to be extinct has been rediscovered “swimming” in the sand near the coastal town of Port Nolloth in South Africa.
The De Winton’s golden mole lives in underground burrows and dives if it feels footsteps approaching. It has not been recorded since 1937, and has been featured among the “most wanted” on a list of lost species. The mole was found thanks to a two-year search by conservationists and a border collie dog called Jessie, who was trained to sniff out golden moles.
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Bored at work?
And finally, the Guardian’s puzzles are here to keep you entertained throughout the day – with plenty more on the Guardian’s Puzzles app for iOS and Android. Until Monday.
