Elon Musk Shuts Down GARM; The Magic of Lawsuits! By Brian Simpson
It seems like only last week that we covered this story about the harm of GARM, the Global Alliance for Responsible Media (GARM) "advertising cartel," who as part of the World Federation of Advertisers, according to a law suit lodged by Elon Musk, illegally conspired to "collectively withhold billions of dollars in advertising revenue" from Twitter, now known as X. However, only 48 hours after announcing that he was going to "war" with them, the World Federation of Advertisers announced it will shut down GARM, saying in a statement that they're "a not-for-profit organization with limited resources." Some doubt this, but it does not matter to the Musk lawsuit as he will no doubt go after the World Federation of Advertisers.
This is a very good example of what can be done by our side of politics with money and power. It is a pity we did not have more.
"48 hours after X and Rumble filed a lawsuit against the Global Alliance for Responsible Media (GARM) 'advertising cartel' and several members, the World Federation of Advertisers announced it will shutter GARM, saying in a statement reported by Business Insider that they're "a not-for-profit organization with limited resources."
That obviously strains credulity considering they do the bidding of companies representing hundreds of billions in market cap, including CVS Health, Mars, Orsted and Unilever.
In an email to members, Stephan Loerke, the CEO of the WFA, said that the decision was "not made lightly." Loerke also said that they intend to contest the allegations in X's lawsuit – and were confident that the outcome would "demonstrate our full adherence to competition rules in all our activities."
The lawsuit alleges that GARM's members illegally conspired to "collectively withhold billions of dollars in advertising revenue" from Twitter, now known as X. The lawsuit also names Unilever, Mars, CVS, and Ørsted.
In response to the announcement, X CEO Linda Yaccarino said the platform that "No small group should be able to monopolize what gets monetized. This is an important acknowledgement and a necessary step in the right direction. I am hopeful that it means ecosystem-wide reform is coming."
GARM was founded in 2019 by WFA, a global association representing over 150 of the world's biggest brands and over 60 national advertiser associations which created GARM in 2019. Its members include heavyweights such as Unilever, Mars, Diageo, Procter & Gamble (P&G), GroupM, AB InBev, L'Oréal, Nestlé, IBM, Mastercard, and PepsiCo. These corporations not only wield immense economic influence but are accused of leveraging this power to control online discourse under the guise of "brand safety."
This alliance quickly amassed significant market power, representing roughly 90% of global advertising spend, which amounts to nearly one trillion dollars annually.
Following Elon Musk's takeover of Twitter, advertising plummeted. The lawsuit alleges that after Musk acquired the company, GARM persuaded top brands to yank advertising.
"This is a big win for the First Amendment and a big win for Chairman Jordan's oversight work," said Russell Dye, a spokesperson for the House Oversight Committee.
Shortly after lawsuit was filed, video-sharing platform Rumble joined the lawsuit.
The conspiracy centers around an initiative called the Global Alliance for Responsible Media (GARM), created by the WFA, that established arbitrary standards for the content on digital platforms where its members may want to advertise. GARM used those one-size-fits-all standards to perpetrate an advertiser boycott against Rumble and other platforms. The suit also notes that GARM has vast reach since it counts the six largest ad agency holding companies among its members, including defendant WPP.
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