Elon Musk’s social media platform, X (formerly Twitter), has reached a surprising agreement with Twitch, ending legal hostilities between the two companies. The deal comes after X accused the Amazon-owned streaming giant of conspiring with other advertisers to boycott its platform, leading to significant revenue losses.
According to a recent court filing in Texas, X has agreed to dismiss its lawsuit against Twitch—but only if the live-streaming service meets certain undisclosed conditions by the end of 2024. This marks at least the second settlement in X’s broader legal battle, following a similar agreement with Unilever last October.
The Backstory: Why X Sued Twitch and Other Advertisers
In November 2023, X filed a lawsuit against multiple companies, including Twitch, alleging an illegal advertising boycott. The platform claimed that major brands, influenced by the World Federation of Advertisers (WFA), had colluded to pull their ads, costing X billions in revenue.
The advertising exodus began shortly after Musk acquired Twitter in October 2022. Many brands grew uneasy about placing ads on X, fearing their content would appear alongside harmful or misleading posts. Under previous management, Twitter had stricter moderation policies, but Musk’s push for “free speech” led to concerns over brand safety.
What Does This Settlement Mean?
While the exact terms remain confidential, the agreement suggests that Twitch may have agreed to resume advertising on X under specific conditions. This could signal a potential thaw in relations between X and other advertisers.
Unilever’s earlier settlement required X to meet certain “brand safety standards,” hinting that Musk’s platform may be making concessions to win back advertisers. However, major brands like CVS, Pinterest, and Colgate-Palmolive remain defendants in the ongoing lawsuit.
Will Advertisers Return to X?
Despite Musk’s efforts, X continues to struggle with regaining advertiser trust. The platform’s ad revenue reportedly dropped by over 50% in 2023, and while settlements like this may help, the long-term impact remains uncertain.
For now, the Twitch deal is a small victory for X—but the bigger question is whether other companies will follow suit or continue to keep their distance.
