The Journal. - Israel-Hamas War Tests Musk's Content Policies

Episode Date: October 16, 2023

The war between Israel and Hamas is one of the biggest tests of social-media’s content policing in years. Platforms have been dealing with a range of challenges, such as misidentified video footage, fabricated information and violent content. As WSJ's Tim Higgins explains, Elon Musk’s Twitter-turned-X has had major stumbles and is drawing European regulators' scrutiny. Further Reading: -Elon Musk and Linda Yaccarino Point X in Different Directions Amid Israel-Hamas War  -X Fumbles First Big Musk-Era Test of Content Policies After Israel Attack  Further Listening: -Elon Musk’s ‘Demon Mode’  -Elon Musk Wants to Build an Everything App  -Elon Musk on 2022 Politics, Succession Plans and Whether AI Will Annihilate Humanity  Learn more about your ad choices. Visit megaphone.fm/adchoices

When Elon Musk bought Twitter, now called X, about a year ago, the platform had some challenges. Twitter is a company that has never been a huge moneymaker over the years. It's lost a lot of money. It's struggled to kind of find its way. This was before Elon took over, and now it's just seen its revenue fall even more. That's our colleague Tim Higgins. For the last year, Musk has been trying to turn around the company's business.

He's laid off thousands of employees, loosened content moderation, and tried to open up the platform to different points of view, promoting it as a bastion of free speech. But in the last week, that strategy has been put to the test after the war began between Israel and Hamas. When you look at X in that kind of early days, you could see lots of content that looked like maybe it was coming from a war zone and it was being purported to being from the war zone. Old video

clips being misleadingly repurposed, even a fake White House press release widely circulated. release widely circulated. The sorts of things that people say can be potentially harmful, the things that make experts and observers really worried. How would you characterize how important this moment is for X? This is Elon Musk's first big test as the owner of X. This was the concern when he started making major changes to how the company operated, how it addressed misinformation, how it addressed disinformation. And the warnings were that X wouldn't be prepared when something big happened, and now something big has happened. Welcome to The Journal, our show about money, business, and power. I'm Kate Linebaugh. It's Monday, October 16th.

Coming up on the show, how the war between Israel and Hamas is testing X. On October 7th, Hamas launched brutal attacks on Israel. Israel retaliated by bombing Gaza. And quickly, disinformation started spreading on X. In the early hours of the war, Elon Musk was pointing users to creators on X saying, follow these people for real-time, on-the-ground news coming out of this region. That tweet was later deleted when it was quickly became known that these users had kind of a questionable history of content in the past, underscoring just how difficult this is, how difficult it is to get accurate or information out of a war zone. And at times like this, increasingly, right, social media platforms are where a lot of people go to get information. increasingly, right, social media platforms are where a lot of people go to get information.

You know, the argument by Elon about X is that this is the place you can go for real-time information to understand what's going on in your world. And if the videos that are getting millions of views are not of what's going on, then it can confuse the debate. It can inflame passions. And, you know, this is just part of the challenge that X and all of these social media companies have. But because of the decisions that Elon has made, these kinds of tricky situations are just so much more complicated for X. And what are those decisions that he's made? Elon Musk came in to Twitter and he didn't just change the name.

He really changed the company dramatically by essentially getting rid of just about everybody. A new chapter has begun at Twitter. And for half the people who work there, they will not be part of it. He said he needed to save money because of the company's finances, but also there was some cultural clashes between the way he wanted the company to be operated and the way the company had been operated. He felt like Twitter slash X was stifling free speech that had gone down a path that was not good for the country and not good for

civilization. He wants it to be a platform where people can go on there and say things even that are disagreeable. And so he slashed the workforce, but he also, in a lot of ways by doing that, dismantled the machinery that was working to fight disinformation. Instead of relying on engineers to stop the spread of disinformation, Musk has leaned on a fact-checking feature called community notes. This basically allows a group of user volunteers to leave write-ups underneath misleading posts. These users are going through and finding information,

tweets that aren't right, and they append a note to it. Some of Elon Musk's own tweets have been community noted, if you will. And that's in the past few days, the company has talked about how they've been moving to get these posts up quicker

and using these to really address some of these issues that you're seeing on the platform. But what if you don't like read those notes? Well, right. One of the criticisms against this kind of approach is that are users really reading these notes? And, you know, are they really having a meaningful impact? Because think about it, if you see a video, you're scrolling through your X feed, you're seeing the video, or you're necessarily reading some kind of fine print about what the video is. Another thing that's changed is the verification process. In the past,

the platform handed out blue check marks to some users, like journalists or politicians, as a way to signal their legitimacy. But Musk did away with that system. Twitter is saying goodbye to its old verification program. To have an account with that blue check, you're going to have to pay. Essentially, the blue checkmark was up for grabs. Being verified helps boost your signal, boosts your posts. And so, you know, those kinds of things combined changes the dynamic of the user experience.

Musk said he wanted to open up X to be a place where more voices are heard and where users can determine for themselves what is right and what is wrong. Now the concern is that when you plug into X, there is so much noise, there is so much unverified information, that are you really learning anything or are you really even reading and seeing things that are relevant to what is going on? So that the risk to X in the future is that it loses its place in the media diet of the user,

that it becomes almost too much noise and not reliable. And now X is facing a potentially costly regulatory challenge over content related to the Israel-Hamas war. That's next. That's next. So what's it like to buy your first cryptocurrency on Kraken? off this summer. More details Go to Kraken.com and see what crypto can be. Not investment advice. Crypto trading involves risk of loss. See Kraken.com slash legal slash CA dash PRU dash disclaimer for info on Kraken's undertaking to register in Canada. Last week, just days into the war, the European Union warned several social media platforms to be careful handling misinformation.

And it flagged particular concerns about X. As attention quickly turned to how X was handling its role in being a communication place for the war, the European Commission came knocking. It released a letter that it had sent to Elon Musk with some pretty stark and concerning allegations. It started off, Dear Mr. Musk, following the terrorist attacks carried out by Hamas against Israel, we have indications that your platform is being used to disseminate illegal content and disinformation in the EU. So the letter talks about concerns that the platform is being used to disseminate illegal content and disinformation in the European Union and reminding the company and Musk about all of the things that they are

supposed to be doing and that this compliance is required. What is emboldening the EU? The EU last year passed some very aggressive laws that aim to rein in big tech. One of those laws, the Digital Services Act, targets companies such as X concerned about content that is harmful. The EU's Digital Service Act is taking the internet by storm, marking the toughest regulation since social media burst onto screens. The law is kind of different than the way these companies had been accustomed to being treated here in the U.S., where they enjoyed some protections.

This new law makes them more responsible for assessing and mitigating potentially harmful content. And it went into effect in August, and the war, the breakout of the war, has been one of these moments where the regulator has really, really kind of indicated, had sent signals that they are paying close attention and that this compliance is required. So what was Musk's response? Elon's almost immediate response was to take to X and kind of jab back at the regulator, as he does with U.S. regulators on a regular basis when he feels either threatened or feels like they are in the wrong. And he is essentially his defense has been that he doesn't know what they're talking about.

And they haven't provided any examples of that. Meanwhile, X's CEO, Linda Iaccarino, was taking a different approach. Iaccarino, who's been on the job for about four months, has been trying to boost revenue on the platform. Her approach to dealing with the world is just dramatically different. Elon Musk is about defiance. dealing with the world is just dramatically different. Elon Musk is about defiance.

His fights with regulators and rivals are kind of part of his allure, part of the way he kind of made himself big in the world. Linda had a different approach. You know, she has a stiff spine, but she also is known for her charm offensives. And how has this played out in response to the letter from the EU? So, you know, in the last few days, you've seen Linda out there really trying to tout how the company is trying to address concerns around misinformation, an effort that's kind of described as around the clock. Linda released a letter that she had sent to regulators

trying to show that they were complying with the EU's new laws around social media companies, a four-page letter that went into all the details of things that they've been doing behind the scenes, efforts they've been taking to take down questionable content, these sorts of things. Iaccarino pointed out that X had removed or labeled tens of thousands of pieces of content and said that the company had sped up the publishing of community notes.

But the EU didn't seem convinced. At the end of the week, it seems that regulators weren't satisfied with her response and they have elevated and escalated their inquiry, now making it formal, the first step into an investigation into their compliance. What happens if X can't convince the EU that it's in compliance with these rules? The penalties are pretty stiff.

Fines up to 6% of global revenue, they could be blocked from being able to provide their services in the region. Really, the kinds of things that X doesn't have the luxury of kind of enduring at this point. You know, it's a risky gamble to be tangling with the EU at the moment. The other threat to X is that if it loses its appeal, if it loses its audience, then it really ceases to become valuable. Valuable to other users as a network, but also less valuable to advertisers. And at the same time, you know, the company is trying to convince the world that it is serious,

that it's a place that you can be safe as a brand to spend your money as an advertiser. It's trying to convince users to engage and spend more and more time there. And so it's a battle for what X is going to be. That's all for today, Monday, October 16th. The Journal is a co-production of Spotify and The Wall Street Journal. Additional reporting in this episode by Alexa Kors and Sarah Needleman. Thanks for listening. See you tomorrow.