Texas AG Investigates World Federation Of Advertisers Over 'Boycott' Allegations
Texas Attorney General Ken Paxton announced on Thursday that his office is launching an investigation into whether the World Federation of Advertisers and its now-defunct Global Alliance for Responsible Media coordinated a boycott of social media platforms that may have breached the ad organization's brand safety guidelines.
The investigation stems from concerns that a potential conspiracy among companies to boycott certain platforms could harm competition and potentially violate the Texas Free Enterprise and Antitrust Act of 1983, which prohibits anti-competitive practices and conspiracies that restrain trade or commerce.
A spokesperson for the World Federation of Advertisers defended the Global Alliance for Responsible Media, stating that it was a voluntary and pro-competitive initiative aimed at assisting advertisers in making informed choices about where to place their ads in alignment with their brand interests.
House Judiciary Committee Findings
The news of Paxton's investigation comes shortly after a report by the Republican-led House Judiciary Committee suggested that the Global Alliance for Responsible Media may have breached U.S. antitrust laws. The report alleged that the organization orchestrated an effort to avoid advertising on media outlets featuring "disfavored" content, impacting platforms like X (formerly Twitter).
The report also accused the ad group of trying to stifle certain voices, such as podcast host Joe Rogan, and targeting right-wing news sites considered "disfavored."
Following the release of the report, X Corp. filed a lawsuit against the World Federation of Advertisers and the Global Alliance for Responsible Media, alleging that their actions led to a significant loss in ad revenue for the company. X also sued several advertisers, including Amazon's Twitch, Mars, and CVS, accusing them of participating in a scheme to diminish X's advertising revenue.
Transparency and Industry Standards
In response to the allegations, a spokesperson for the Global Alliance for Responsible Media emphasized the organization's role in promoting transparency and establishing voluntary industry standards related to brand safety and suitability in digital advertising. The spokesperson highlighted the voluntary nature of these standards, which media sellers and ad tech companies could choose to adopt or reject.
Other Investigations
Aside from the inquiry into the World Federation of Advertisers, Paxton has also initiated investigations into tech companies regarding content moderation practices that he believes are ideologically motivated. Additionally, he has targeted watchdog organizations like Media Matters for reports criticizing brand safety issues on X.
Despite the legal actions taken, some critics have expressed skepticism about the motives behind the lawsuits, suggesting that they may be aimed at punishing organizations for advising divestment from certain platforms rather than addressing legitimate legal concerns.
It remains to be seen how these investigations will unfold and what implications they may have for the advertising industry and digital platforms involved.
