Hey everybody, welcome back to the Elon Musk Podcast.
This is a show where we discuss the critical Crossroads, The Shape, SpaceX, Tesla X, The Boring Company, and Neuralink, and I'm your host, Will Walden. If you want uninterrupted episodes of the Elon Musk podcast, please go to clubelon.supercast.com to find out how there's a link in the show notes NASA has recently addressed claims about SpaceX CEO Elon Musk's alleged illegal drug use, stating that they have no evidence of non compliance regarding drug and alcohol free
workplace regulations. Now, this statement was a direct response to inquiries about Elon Musk's behavior, which has been under scrutiny, especially following his on air weed use in 2018 and his public endorsements of substances like ketamine and psychedelics for public mental health treatments are the allegations against Musk include unverified insider claims of his use of substances ranging from cocaine to LSD.
Now, these reports have raised concerns about his leadership and behavior, and in response, NASA, which has significant contracts with his rocket company SpaceX, has had to examine these allegations closely due to federal government standards regarding drug use, and according to NASA, it's contracted companies like SpaceX are responsible for ensuring their employees comply with drug free workplace
regulations. This includes employees in sensitive positions, which would presumably include Musk given his high profile role and influence within SpaceX. Now there's speculation about the process SpaceX uses to collect and test Musk drug samples, though the speculation includes questions about the reliability and the integrity of the testing processes, essentially considering Musk's
high status within the company. Now, Business Insider had a report last month, and a further investigation revealed that NASA has been somewhat secretive about the findings of their drug use probe as SpaceX. This secrecy has led to more speculation that if Musk is using drugs, he's managing to do so without detection by government authorities.
Now, NASA spent three months reviewing Spacex's adherence to a drug free workplace following Musk's appearance on Joe Rogan's podcast in 2018, where he is seen smoking marijuana. Results of this investigation, obtained by Business Insider through the Freedom of Information Act, were heavily redacted, leaving the findings very unclear.
The Organizational Safety Assessment by NASA was initiated after reports surfaced that Musk was micro dosing ketamine, and the Wall Street Journal's report in this matter prompted new questions about Musk's drug use. NASA initially denied having records of the assessment's results.
However, after Business Insider pointed out the $5,000,000 taxpayer funded probe, NASA released some documents related to the investigation, but they were heavily censored and the probe, which included interviews with 296 SpaceX employees, covered SpaceX facilities across the United States. Despite its extensive nature and the high cost, the results were kept confidential with NASA concerns over harming Spacex's competitive posture or business interests.
Now William Gerstenmeyer, the NASA administrator who requested the review, emphasized the importance of safety in the United States based program and the need for SpaceX to maintain a drug free workplace. Now, Gerstenmeyer later joined SpaceX as the Vice President of Build and Flight Reliability, and Elon has publicly responded to allegations of drug use, particularly in light of the Wall Street Journal report. He stated that three years of random testing found no traces
of drug use in his system. Musk criticize the Wall Street Journal report, dismissing it as very inaccurate, and concerns over Musk's drug use are not just limited to external reports. Senior figures within Musk's own companies have expressed worries, with a Tesla board director reportedly stepping down due to these concerns, and incidents like Musk's tweet about taking Tesla private have also raised questions about his state of mind during significant
business decisions. Musk's appearance on Joe Rogan's podcast where he smoked weed led to a $5,000,000 NASA investigation at a drug use at SpaceX in the results, and the implications of the investigation remain largely unknown to the public. And following the Rogan incident, Musk and SpaceX employees were now subject to
random drug tests for a year. This was in compliance with federal requirements for companies working with the government, highlighting the strict, very strict standards that federal contractors must adhere to. And Musk has maintained that he does not engage in illegal drug use, emphasizing his dislike for such substances. This claim stands in contrast to the various reports and allegations that have surfaced over the years, creating a dichotomy between Musk's public persona and the rumors
surrounding his personal life. The controversy surrounding Musk's alleged drug use and NASA's response illustrates the complex relationship between high profile individuals, their personal conduct, and their professional responsibilities, especially when government contracts and public safety are involved in the on growing scrutiny of Musk's behavior in NASA's investigation into Spacex's drug free workplace compliance continue to be subjects of interest both within
the space industry and among the general public and reporters as well. And the outcome of these investigations and Musk's responses will likely have significant effects on Spacex's future operations and its relationships with NASA. As of right now, Elon and the rest of the SpaceX crew are free and cleared to continue doing
what they do now. While NASA's statement and the subsequent investigations have not definitively resolved questions about Elon Musk's alleged drug use, they've highlighted the importance of maintaining stringent standards and high stakes industries like space exploration. The issue remains a topic of public and professional debate, reflecting the challenges of balancing personal freedoms with professional responsibilities in highly regulated sectors.
So SpaceX had a recent Starship System test and it marks an important, albeit very complex point in its development journey. Despite the loss of the Super heavy booster and the Starship spacecraft during the IFT 2 flight, SpaceX remains optimistic, viewing the event as a valuable learning opportunity for advancing its multi planetary ambitions. Now SpaceX in a statement emphasizes the significance of the test for gaining crucial data to enhance starships reliability.
This incident underscores the challenges of SpaceX faces and perfecting the technology needed for future space missions, including colonization of other planets like Mars and beyond. Now the Starship system is not only a key player in Spacex's grand vision for space travel, but also a critical component in NASA's Artemis program. This program aims to return US astronauts to the moon, a feat not achieved in over 50 years or five decades. And this one's different.
They're going to establish permanent lunar outpost, the Artemis 3 mission scheduled for late 2025 but possibly being pushed on even further Plans to utilize the Starship spacecraft and the recent test flight failure has raised concerns about meeting this deadline, although the NASA officials maintained an optimistic outlook, valuing the lessons learned from each one of these tests. IFT 1, IFT 2 and soon, probably February of 2024 IFT 3.
Let's go back to the second test flight of the Starship. The system demonstrated significant improvements over its first attempt. The successful ignition of all 33 engine and the survival of the launchpad against immense thrust are notable achievements. However, this mission also faced critical failures that hindered its full execution.
Now the Super heavy booster is unexpected explosion after detaching from the Starship and the subsequent loss of signal from the Starship capsule highlight key areas for improvement. These events prevented SpaceX from testing vital landing and reusability maneuvers. Now Elon Musk, the SpaceX CEO, has acknowledged the complexity of ensuring safe re entry and landing for the Starship. This aspect remains one of the most challenging hurdles in the
vehicle's development. Reusability is a cornerstone of all of Spacex's strategy, but essentially the Starship system needs this in order to complete the goal to get to the lunar surface. Now successfully recovering and reusing both the Starship spacecraft and the Super Heavy booster is crucial for frequent and cost effective lunar missions. The orbital refueling of Starship is also a critical step for lunar missions.
Given the immense fuel consumption during loss, over a dozen tanker missions may be required to refuel a single Starship for its lunar journey. Just recently, in a talk with NASA, a SpaceX representative said it would take about 10 refuels for the Starship and the lunar mission. Now, achieving a moon landing with Starship involves multiple development milestones, including hundreds of satellite missions, tanker version testing, and an uncrewed lunar
landing. Spacex's approach to edit this out, Spacex's approach to development embraces the risk of explosive failures as a path to rapid learning and also improvement of the Starship system. Comparatively, NASA's traditional development approach, characterized by extensive ground testing, contrasts with Spacex's more experimental and cost effective
method. The difference in approach reflects the varying priorities and methodologies of government and now private sector space exploration with SpaceX now in the broader context of lunar Landers, SpaceX Starship competes with Blue Origins Blue Moon, another contender for future Artemis missions. Each company faces unique challenges in the respective designs and strategies for Moon
landings. Now, the current initiatives to send humans back to the moon through programs like Artemis mark a shift from NASA's historic Apollo missions. Unlike Apollo, which was primarily focused on achieving the first lunar landing and established American dominance in space during the Cold War, the Artemis program aims for a sustainable and long term presence on the moon.
This new era in lunar exploration is not about repeating the past, but about laying the new groundwork for future space endeavors, including potential missions to Mars. And a key difference between the Apollo program and current lunar missions is the emphasis on sustainability and also reusability in space travel.
While Apollo missions were essentially one off ventures, the Artemis program, with the help of technologies like Spacex's Starship, seeks to establish a continuous human presence on the Moon. This approach involves developing infrastructure for repeated trips, permanent lunar bases, and technologies that can be adapted for future Mars missions, representing a significant advancement from the Apollo era. Apollo basically sent humans to the moon and brought them back to Earth.
We're going to set up an infrastructure for future generations with the Artemis program, and the Artemis missions also differ in their collaborative nature. The Apollo program was a largely national effort, driven by the geopolitical context of the 1960s, the Cold War, and in contrast, Artemis is more international and commercial, involving partnerships with various countries and also various private companies like SpaceX and Blue Origin.
This collaborative approach not only spreads the financial burden, but also brings together a diverse range of expertise in technology, making the mission more robust and inclusive. The technological advancement since the Apollo era also play a critical role in shaping the Artemis missions. Today's spacecraft, lunar Landers, and other space technologies benefit from decades of innovation in material science, computing, and engineering.
These advancements enable more ambitious missions, such as establishing a permanent base on the Moon and eventually sending humans to Mars, which were beyond the scope of the Apollo program. The Artemis missions therefore stand as an important milestone in the ongoing evolution of space exploration. Now, looking ahead, SpaceX plans to ready the Starship system for another test flight within weeks, should be about mid January, late January.
For this, however, the timeline is uncertain given the need for a thorough analysis of the recent test data and regulatory approvals from the FAA and the FAAA Involvement in investigating the recent test flight and its role in approving future launches adds another layer of complexity to Spacex's
timeline. The duration of these regulatory processes remains unclear, but SpaceX is hoping to get FAA clearance by February. Spacex's recent Starship test represents a significant but mixed step in the journey towards advanced space exploration. The successes and setbacks of this test provide vital insights for SpaceX as it continues to develop technology that could shape our approach to exploring and inhabiting space from the
Moon to Mars and beyond. So Elon Musk recently shared insights into the second full scale Starship test flight, which ended unexpectedly, and the starship's upper stage exploded due to a fire ignited during the venting of liquid oxygen propellant. Musk clarified this. He said the reason that it actually didn't quite make it to orbit was we vented the liquid oxygen and the liquid oxygen ultimately led to a fire and an explosion.
Now looking ahead, SpaceX has set very ambitious targets for the next Starship test. Objectives include reactivating the Raptor engines in space, conducting an in flight propellant transfer and also operating the payload Bay door potentially as early as February of 2024. Now the in flight propellant transfer is possibly for an upcoming NASA Artemis mission. The payload door is for Starlink satellite deployment and reigniting.
The Raptor engines in space propels the Starship spacecraft all the way to Kauai near Hawaii and that's where it will splash down in the ocean now. Meanwhile, the Falcon 9 and the Falcon Heavy rockets remain in Spacex's operations and these rockets will continue their service into the late twenty 20s and possibly beyond 20-30 carrying satellites, cargo and also astronauts. Now significant enhancements are
planned for the Falcon series. Musk aims to certify Falcon first stage boosters for up to 40 flights and reduce turn around times for launchpads to under 24 hours. And a key event for SpaceX has the launch of the private mission to the International Space Station. With four individuals on board, this mission, facilitated in collaboration with Axiom Space, is a huge step for commercial Space Flight. Now funded by Axiom Space
itself. This mission represents the third group of paying passengers to the International Space Station. Axiom Space, aspiring to build its own space station similar to the International Space Station, is using these missions as fundamental experiences now.
The mission faced A slight delay for additional pre launch checks, particularly focusing on the Parachute Systems Energy Modulator. Once resolved, SpaceX confirmed readiness for the rescheduled launch and during their two week stay at the ISS, the crew will engage in around 30 experiments encompassing microgravity research, technological administrations and educational activities. The mission, dubbed AX3, saw the crew Dragon spacecraft freedom making its third journey to space.
Leading the crew was Axiom's Chief astronaut, Michael Locev Allegra, accompanied by three international astronauts. Now there's a Turkish astronaut on board, and this mission represents the commencement of an expansive space exploration journey, he said. This Space Flight is not a destination, but it's a journey. This is just the beginning of our journey for a long growing space journey in our future.
And Spacex's collaboration with Axiom Space led to the successful launch of the AX 3 mission to the International Space Station. The Falcon 9's rocket launch from Kennedy Space Center was a key moment in this partnership and the missions delay was partly attributed to issues with parachute strap known as Energy Modulators detected during the CRS 29 Cargo Dragon mission. These were rectified in time for
the AX3 launch. Now following a smooth docking process, the AX3 crew commenced their scientific and technical word inside of the International Space Station and their two week tenure will contribute significantly to ongoing Space Research. AX3 plays a vital role in Axiom Space's long term vision of establishing commercial modules on the ISS, eventually transitioning into a stand alone commercial space station post ISS retirement.
The diverse crew of AXE 3, representing various European governments, highlights the increased international collaboration in space missions as well. This includes astronauts from Italy, Turkey, and Sweden. In alignment with NASA's broader strategy, Private astronauts missions like AX3 are instrumental in the development of commercial space habitats, which is a key focus of NASA as they pivot to lunar and eventually to Mars missions.
The repeated use of these Falcon 9 boosters and the Crew Dragon spacecraft in the AX 3 mission shows that SpaceX is committed to sustainability and reusability in space travel. That's their mantra. They have to reuse every single booster and possibly every single upper stage, and that's what they're working for with the Starship system now. All of the Axiom 3 astronauts successfully docked at the ISS at 5:42 AM Eastern Time on January 20th, 2024.
This is achieved as Dragon seamlessly docked to the space station orbiting approximately 262 miles above the Pacific Ocean West of South Africa, or, sorry, South America. Now this successful docking is a significant achievement for both SpaceX Axiom Space and for the International Space flight community. The precision and the coordination demonstrating this operation show the advanced in capabilities of Spacex's technology and the growing potential of commercial space missions.
Spacex's Starlink has recently conducted its first successful live test of the new global direct to sell or the DTC mobile roaming service. This is a huge test. It's conducted with standard, unmodified smartphones comes just days after the launch of the first batch of DTC capable satellites on top of a Falcon 9 rocket. Currently the service is limited to sending and receiving texts only, but in the future they want to do phone calls and send
data too. Now the Starlink network with approximately 5311 low Earth orbit satellites, or Leo, is set to expand by roughly 7500 by the end of 2027. Now in the UK, Starlink offers packages starting at about $75.00 a month, and in the US it's about the same. And that's you also have to buy the equipment as well for the ground services. Now the service promises fast Internet with low latency times and considerable download and
upload speeds in rural areas. Globally, Starlink boasts 2.3 million customers with 42,000 of them in the UK and more in the US, primarily in rural areas. In the addition of 4G mobile capability to the satellite constellation aims to enable global roaming communications with regular smartphones, a significant step beyond traditional satellite phone services. Now Starlink's DTC satellites feature in advance E node B modem functioning like a cell
phone tower in space. Now this innovation allows for network integration akin to standard roaming services in the first technological test of this capability. Was conducted in the USA in partnership with T-Mobile. The test demonstrated the capability of these satellites to facilitate the sending and receiving of text messages via
an unspecified smartphone. This marks a huge achievement in satellite based communication technologies and Starlight's statement highlighted the challenges and breakthroughs of this tech. They noted the difficulties of connecting cell phones to moving satellites and the innovative solutions involving custom silicone phased array antennas and advanced software algorithms to overcome those challenges.
And SpaceX plans to launch additional DTC capable satellites to introduce a basic text service by 2024, and with the aim to expand to voice data and IoT services by 2025. Now currently in the UK, they lack a mobile operator partner for the service, but in the US they have T-Mobile and pricing details for global roaming plans are yet to be disclosed.
Elon Musk has stated that the first DTC capable satellites offer limited data speeds, suggesting that while beneficial for areas without cell connectivity, they're not competitive with terrestrial networks. Yet. System aims to provide basic communication needs, particularly in remote areas, say if you're hiking in the woods, or if you're up on a mountain, or if you're skiing someplace where there's no cell
service. Well, this could possibly be at least a lifeline with a text service and possible data in the near future. Now, a recent update from Starlink revealed their successful test with T-Mobile using network spectrum to send and receive text messages
through their new satellites. And this is a major advancement in integrating satellite and cell communications because currently we have cell towers and the service described as cell phone towers in space plans to offer text messages later this year for T-Mobile customers in the US in a broader range with voice and data services expected to commence in 2025.
And the connectivity of these cell phones to satellites was also outlined by SpaceX. And they said that the challenges of terrestrial stationary networks versus fast moving satellites is remarkable. The company showed that technological advancements enabled standard LTE services to
cell phones on the ground. T-mobile's collaboration with Spacex's Starlink is a huge advancement in the cellular coverage for space tech now, particularly in areas traditionally underserved by conventional network infrastructure. Its partnership is not just about enhancing existing services, but also moving forward with a novel approach to connectivity. The field test plans with Starlink satellites show a crucial step in this joint adventure.
Now these tests aim to demonstrate the practicality and effectiveness of using satellites to bridge coverage gaps in regions where geographical challenges such as rugged terrain or stringent land use restrictions impede the establishment of ground based cellular towers. Now this network could provide a much needed solution. This approach promises to extend T-mobile's reach, offering connectivity to customers in even the most remote locations.
Now the significance of this development lies in its potential to redefine the scope of mobile network coverage. By integrating satellite technology into their network, T-mobile's not only looking to enhance their service in remote areas, but also to ensure reliability and continuous connectivity in emergency situations where terrestrial
networks might fail. This initiative could transform the way we think about mobile coverage, especially in disaster prone regions where communication is critical. The collaboration is poised to offer a unique combination of terrestrial and extraterrestrial network capabilities, creating a more robust and versatile communication network.
The anticipation around the field testing phase reflects the industry's growing recognition of the need for more innovative solutions to address connectivity challenges in diverse environments. This T-Mobile and Spacex's startling venture into this new territory. They're setting the stage for more connected future.
The success of this partnership could encourage other mobile operators to explore similar satellite based solutions, potentially leading to a more interconnected and accessible world. A Starling satellites, once fully operational, could provide a more complementary layer to existing cell networks, ensuring that people stay connected all the time regardless of the location. Now, it's not just a technological leap though.
It's a commitment to bridging the digital divide between land based and space based Internet and all corners of the globe. The plan is to launch D2D text service this year and expand to include voice data in Internet of Things services by 2025. The expansion of the Starlink Internet service to a network of over 5000 satellites serving more than 2.3 million customers worldwide shows that they want to scale this.
And in the broader context, several smartphone manufacturers, service providers, and satellite companies are collaborating to roll out direct to device services. Apple, for instance, has launched its Emergency SOS with satellite service in partnership with Global Star, while Iridium recently introduced Project Stardust, aiming to test its D2D service in 2025. Now, Qualcomm's dissolved partnership with Iridium and the latter's new initiative highlight the dynamic nature of
collaborations in the sector. Iridium planned to begin rolling out its D2D service by 2026 adds another layer to the landscape of satellite based communication services. The series of developments underscores the technological strides being made by satellite companies and the ability to connect regular smartphones directly to satellites open up some new possibilities for global connectivity, particularly in these remote and underserved areas that we were
talking about earlier. This is a huge, huge development, especially for regions lacking traditional cellular network infrastructure, and as this technology evolves, we'll be here to let you know about everything that happens. Tesla Inc has witnessed a sharp decline in market value, losing over $94 billion in the early weeks of 2024. Now this downturn marks a stark contrast to the company's success in 2023, where its stock value more than doubled.
Now the slump is attributed to a series of adverse developments, including reduced demand for E VS in the United States, price cuts in China, and increasing labor costs. Now, the electric vehicle industry is currently experiencing A slowdown altogether, particularly in the
US market. Investors main concern on Tesla is stagnating growth, said Jeffrey Osborne, an analyst from Cohen, highlighting concerns about Tesla's performance, especially in light of the price reductions in the competitive Chinese market. Now these factors have fueled investor apprehension, contributing to the company's recent financial setbacks. Tesla's recent market capitalization loss is unprecedented.
Since its public debut in 2010, the company's stock has plunged by 12% since January 2024, the most significant drop since a 14% decline over the first nine trading days of 2016. The outlook for a rapid recovery seems bleak given the current market conditions, and the company has been aggressively cutting prices since early of 2023 to stimulate demand. But this strategy has led to a substantial erosion of profit
margins. The third quarter of the previous year saw Tesla's automotive gross margin excluded regulatory credits fall to 16.3% from 27.9% a year earlier. And additionally, Tesla is facing increased financial pressure due to pay raises for production workers at its US plants. We are going through a cyclical downturn for EVs, but competitive dynamics are exacerbating the cyclical pressures, said Ivana Deleskva, senior chief investment officer at Spear Invest.
She noted that the combination of price cuts and shrinking margins are consequences of these challenging market conditions now adding to Tesla's challenges. The company has had to redirect shipments intended for its Berlin plant and suspend most production there from January 29th to February 11th due to security concerns and Western military actions in the red scene. This disruption further complicates the company's
operational landscape. Tesla first raised alarms about slow EV demand during its third quarter earnings report in October. Following this, several automakers and suppliers worldwide expressed similar concerns, leading to a scaling back of expansion plans across the industry in recent development. Tesla's fourth quarter delivery numbers, though better than expected, positioned the company behind China's BYD company in
global electric car sales. This shift has been a wake up call for investors, particularly after Tesla's stock was among the top performance in the S&P 500 last year. Tesla CEO Elon Musk, the world's richest person as of last year, has seen a significant decrease in his net worth by $23 billion in the early part of 2024. His wealth, primarily derived from his stakes and Tesla and SpaceX, has been affected by the recent downturn in Tesla's market value.
And despite these setbacks, Tesla remains A crucial player in the global shift towards electric vehicles. While China's BYD has surpassed Tesla in unit sales, Tesla still leads in revenue and profits, particularly in the US market. However, Tesla's past success and inflated market capitalization have made its stock particularly sensitive to negative news. A major point of contention of Tesla is its unfulfilled promise to fully autonomous driving and
AI advancements. Being simply another automotive manufacturer is not going to cut it for a $750 billion valuation, said to Levskip, emphasizing that Tesla's high valuation hinges on these future technologies and the company's failure to deliver on them. Thus far, in response to industry trends, Tesla has announced pay increases for
workers at its US factories. This move follows similar actions by non union automakers like Toyota, Volkswagen and Hyundai coming in the wake of historic labor contracts securing the United Auto Workers or UAW for employees at Ford, General Motors and Solantis. Now the pay raises at Tesla, which were not detailed in terms of amounts, apply to all US production associates, material handlers and quality inspectors.
This decision aligns with broader industry trends where automakers are increasing wages to remain competitive and respond to unitization efforts. So Tesla's not doing anything really out of the ordinary here. UAW President Sean Fain has identified Tesla as a key target in the union's expansion efforts following successful wage negotiations with the Big Three
automakers. And Fain attributed past unization failures to internal corruption and unfavorable contracts, or remains optimistic about UA WS future prospects. Elon Musk, Tesla CEO, has historically been critical of unions. He's emphasized cost cutting measures in response to economic pressures and the need to make Tesla's electric vehicles more affordable. The increased wages for production workers, however, may complicate these cost reduction efforts.
Tesla's Fremont factory, which employs over 20,000 workers, has seen the formation of a UAW organizing committee. The National Labor Relations Board previously ruled that Tesla violated labor laws during past unionization efforts. Tesla denies these allegation and is appealing the ruling in federal court. The pay increases at Tesla's US plans reflect A broader industry trend now following the UAW successful strikes against the Big Three automakers.
Other major car companies including Hyundai, Honda, and Toyota have also raised wages at their US factories in response to the unions. Now, the wage hikes at Tesla and other automakers show a significant shift in the automotive industry's labor dynamics. While these increases are a step toward addressing worker demands, they also reflect the changing economic landscape and the growing influence of Labor unions like the UAW.
Now, Tesla's substantial market value loss marks a challenging start to 2024, contrasting sharply with its previous year's huge success. And the company faces multiple hurdles, including slowing EV demand, competitive market dynamics and increased labor costs. And despite these challenges, Tesla is a juggernaut in the EV industry, and now it's under new pressures. And the recent wage increases across the industry, including at Tesla, could mean a significant shift in Tesla's
business. Elon Musk's X, previously known as Twitter, is taking a significant step to enhance brand safety for advertisers. Starting in February, the company will offer US advertisers more control over the vertical video ad placements through an expanded partnership with Integral Ad Services. Now this move comes after the platform faced criticism for its content moderation policies and impact on its ad revenue and brand partnerships.
Now X collaboration with IAS involves classifying all vertical video ad adjacencies to ensure they align with the Global Alliance for Responsible Media Framework, or GARM. The company aims to reassure advertisers that their vertical video ads won't be placed next to harmful or offensive content. Now this effort is a part of X's strategy to rebuild trust with
its advertising partners. The company's recent challenges with brand safety and content moderation have led to a significant loss in advertising revenue.
Major advertisers have reduced their spending on X and shifted to other social media platforms and XS value has plummeted over 71% since Musk's takeover in April of 2022, as estimated by Fidelity. And in an attempt to regain its footing in social media arena and attract advertisers, X is now positioning itself as a video first platform. And the company claims that video content is integral to the majority of user sessions, noting a nearly 30% year over
year increase in video views. However, it remains unclear if this includes all video views or average video views. A vertical video is reportedly the fastest growing feature on X with over 100 million daily viewers and significant user engagement. And despite these claims, there are concerns about the accuracy of these numbers, especially considering the platform's recent changes in content
moderation and leadership. X is actively expanding its brand safety and content moderation teams too, which reverses the downsizing trend initiated by Elon Musk in 2022. This expansion aims to address ongoing concerns about the platform's approach to managing harmful content and maintaining a safe environment for advertisers and users alike. And despite these efforts, experts remain skeptical about X's ability to attract advertisers back.
The company's recent emphasis on video content, including new formats like immersive video and enhanced video Calling Features, is part of its strategy to become an Everything app. And the platform's claims about user engagement with video content, such as the high rate of video watching in user sessions, are met with scepticism. Analysts and industry experts question the clarity and validity of these statistics, especially given the past discrepancy and data released by Axe and Musk.
The expansion of video content on X is also seen as an attempt to win backed advertisers who distance themselves following must controversial actions and its statements. Now. This shift in content strategy reflects the broader effort to diversify the platform's appeal and its revenue sources. Now, XS blog post highlighted a 22% increase in total ad engagements, suggesting that its efforts to make advertising more relevant and impactful are
bearing fruit. However, there's criticism about the decline quality of ads on the platform, with some users noticing an influx of lower quality clickbait type ads. Now, the company has established new partnerships with ad verification and brand safety measurement firms, including Double Verify and IAS, and these collaborations aim to reassure advertisers that the platform's commitment to brand safety following concerns about ads appearing next to inappropriate
content. Now there's a bit of report from Media Matters which revealed inconsistencies in XS brand safety measures with ads from major brands appearing next to controversial content, and X challenged these findings and responded with legal action against Media Matters. The company's expanded partnership with IAS is a part of its effort to bolster brand safety, particularly for its
growing vertical, video content. Now, despite these initiatives, there's continuous skepticism about X's potential gain of lost advertising revenue. And experts highlight that while the focus on video content might appeal to advertisers, the overarching issue related to content moderation and Elon Musk's management style remained deterrent to those advertisers. And industry leaders believe that the root of X's advertising challenges lies in his leadership.
And Musk's actions and statements played a significant role in this. And the platform's struggle to retain and attract advertisers is compounded by the availability of alternative social media platforms like Tiktok, Instagram, Facebook, etc. That are all perceived as safer and more reliable by marketers now. X's recent efforts to promote it's vertical video capabilities are part of a broader strategy to compete directly with popular social media apps like TikTok.
A pitched act obtained by Ad Age reveals the platform's focus on brand safety tools and efforts to combat misinformation. Alongside initiatives to boost user engagement and AD revenue, The platform claims a significant increase in monthly active users and user engagement, particularly among Gen. Z users. And X's pitch deck highlights its new immersive media viewer and various features designed to enhance user interaction with video content and attract more advertisers.
One of their newest strategies includes a focus on major events cultural movements. Leveraging these to appeal to advertisers, the platform is reportedly offering significant discounts to entice advertisers amidst efforts to broaden its content offerings, including long form video and also live streaming. Advertisers, however, remain cautious about X's brand safety measures, especially given the platform's recent challenges with misinformation and
controversial content. X emphasizes its commitment to providing a safe and trusted environment for conversation, advertising and also content. Elon Musk's X, previously known as Twitter, is taking a significant step to enhance
brand safety for advertisers. Starting in February, the company will offer US advertisers more control over the vertical video ad placements through an expanded partnership with Integral Ad Services. Now this move comes after the platform faced criticism for its content moderation policies and the impact on its ad revenue and brand partnerships.
Now, X collaboration with IAS involves classifying all vertical video ad adjacencies to ensure they align with the Global Alliance for Responsible Media Framework, or GARM. The company aims to reassure advertisers that their vertical video ads won't be placed next to harmful or offensive content.
Now this effort is a part of X's strategy to rebuild trust with its advertising partners and the company's recent challenges with brand safety and content moderation have led to a significant loss in advertising revenue.
Major advertisers have reduced their spending on X and shifted to other social media platforms and XS value has plummeted over 71% since Musk's takeover in April of 2022, as estimated by Fidelity. And in an attempt to regain its footing in social media arena and attract advertisers, X is now positioning itself as a video first platform. And the company claims that video content is integral to the majority of user sessions, noting a nearly 30% year over
year increase in video views. However, it remains unclear if this includes all video views or average video views. Now. Vertical video is reportedly the fastest growing feature on X, with over 100 million daily viewers and significant user engagement. And despite these claims, there are concerns about the accuracy of these numbers, especially considering the platform's recent changes in content moderation and leadership.
X is actively expanding its brand safety and content moderation teams too, which reverses the downsizing trend initiated by Elon Musk in 2022. This expansion aims to address ongoing concerns about the platform's approach to managing harmful content and maintaining a safe environment for advertisers and users alike. And despite these efforts, experts remain skeptical about X's ability to attract
advertisers back. The company's recent emphasis on video content, including new formats like immersive video and enhanced video Calling Features, is part of its strategy to become an Everything app. And the platform's claims about user engagement with video content, such as the high rate of video watching in user sessions, are met with
skepticism. Analysts and industry experts question the clarity and validity of these statistics, especially given the past discrepancy in data released by Axe and Musk. The expansion of video content on X is also seen as an attempt to win backed advertisers who distance themselves following must controversial actions and his statements. Now this shift in content strategy reflects A broader effort to diversify the platform's appeal and its revenue sources.
Now, XS blog post highlighted a 22% increase in total ad engagements, suggesting that its efforts to make advertising more relevant and impactful are bearing fruit. However, there's criticism about the decline quality of ads on the platform, with some users noticing an influx of lower
quality clickbait type ads. Now, the company has established new partnerships with ad verification and brand safety measurement firms, including Double Verify and IAS, and these collaborations aim to reassure advertisers of the platform's commitment to brand safety following concerns about ads appearing next to inappropriate content.
Now there's a bit of report from Media Matters which revealed inconsistencies in XS brand safety measures with ads from major brands appearing next to controversial content, and X challenged these findings and responded with legal action against Media Matters. The company's expanded partnership with IAS is a part of its effort to bolster brand safety, particularly for its growing vertical, video content.
Now, despite these initiatives, there's continuous skepticism about X's potential gain of lost advertising revenue. And experts highlight that while the focus on video content might appeal to advertisers, the overarching issue related to content moderation and Elon Musk's management style remained deterrent to those advertisers. And industry leaders believe that the root of X's advertising challenges lies in his
leadership. Then Musk's actions and statements played a significant role in this. And the platform's struggle to retain and attract advertisers is compounded by the availability of alternative social media platforms like Tiktok, Instagram, Facebook, etcetera, that are all perceived as safer and more reliable by
marketers. Now, X's recent efforts to promote its vertical video capabilities are part of a broader strategy to compete directly with popular social media apps like Tiktok. A pitch deck obtained by Ad Age reveals the platform's focus on brand safety tools and efforts to combat misinformation, alongside initiatives to boost user engagement and AD revenue. The platform claims a significant increase in monthly active users and user engagement, particularly among Gen.
Z users. And X's pitch deck highlights its new immersive media viewer and various features designed to enhance user interaction with video content and attract more advertisers. Now the strategy for the upcoming holiday season, one of their newest strategies includes a focus on major events, cultural movements.
Leveraging these to appeal to advertisers, the platform is reportedly offering significant discounts to entice advertisers amidst efforts to broaden its content offerings, including long form video and also live streaming. Advertisers, however, remain cautious about X's brand safety measures, especially given the platform's recent challenges with misinformation and controversial content.
X emphasizes its commitment to provide having a safe and trusted environment for conversation, advertising, and also content. Hey, thank you so much for listening today. I really do appreciate your support. If you could take a second and hit the subscribe or the follow button on whatever podcast platform that you're listening on right now, I'd greatly appreciate it. It helps out the show tremendously and you'll never miss an episode. And each episode is about 10 minutes or less.
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