Elon, Inc.After months of back and forth, Brazil finally did what it’s been threatening to do: ban X. This comes on the heels of government complaints from Britain and elsewhere about false information thriving on Elon Musk’s embattled social media platform—some of it from Musk himself. In this episode of Elon, Inc., we dig into Brazil’s action and also talk about the Android app launch of X TV, a way to watch video content from the former Twitter on your home TV screen. Our panel—David Papadopoulos, Max Chafkin and Kurt Wagner—have some ideas.
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Welcome to Elon Ing, Bloomberg's weekly podcast about Elon Musk. It's Tuesday, September third. I'm your host, David Papadopolis. Welcome back from Labor Day. This week it's all about X.
We'll start with the ban of X in Brazil.
And then we're gonna hit Elon's latest election antics on you guessed it X, and then we're gonna wrap up by discussing his vision and dreams for X TV. Joining us to talk about that are some familiar faces. Max Chafkin, Hey, what's going on?
Max? How are you?
Happy? Belated Labor Day?
Happy blated Labor Day, and to you Kurt Wagner aka Number eight and a social media reporter for us here at Bloomberg.
Kurt, Hey, David, how are you good? All right, Kurt, We're gonna start with you.
Just give us an overview for those of us out there who were just at the beach, soaking up the rays, sipping summer martinis. And we're not following the ins and outs of Elon Muskin X versus the Brazilian Supreme Court. What is transpired and where do things stand there now?
Yeah?
So I believe it was Friday, so a lot of people may have already been checked out for the long weekend, at least here in the US. A Brazilian judge basically cut off X or banned X for the entire country. And this had been the end result of a long saga that has played out over the last several months. The short version is that this judge he wanted X to take action on certain accounts on the platform for sharing misinformation or anti democratic content. X and Elon, of course, you know, saying well free speech absolutism, said no, we're not going to do that. As things sort of got more intense than judge said, well, I'm going to arrest the person or attempt to arrest the person who is representing X and country.
That was weeks ago, the threat to arrest them, right.
That's right that we talked about that, because then Elon's response to that was, well, we're going to leave the country entirely. We're going to you know, stay operational, that you'll be able to use the app in Brazil, but we're not going to have employees there. There's not going to be anyone to arrest. And the judge then said, well, in order to operate here, you need someone here to basically answer questions for the company and you know, receive in this case, our complaints.
You don't have any entire.
X Brazilian staff cannot be working from home in the Bahamas.
Yeah, in Brazil, they need someone physically there to handle an issue like this. And so he says, you need to appoint a legal representative otherwise I'm going to ban you. Elon says, you know, more or less, shove off. I'm not going to appoint anybody, and kind of I don't know if he was attempting to call his bluff or just simply said, you know, we'll we'll be happy to be banned. I don't care, but the judge did follow through and band X on Friday. I believe it's officially no longer working for people in Brazil, and it's a fine if you use a VPN to access it. It's a way to sort of redirect your Internet traffic to maybe a server that's in another country, right, so you would first go to a server in a country where X is allowed, and then it sort of redirects it and that way you get around the ban that way. But again there's a fine for people who do that. So you know, we're at this point now where X is banned. The Supreme Court, the rest of the Supreme Court upheld the original judge's decision, so X can still appeal, but you know, we're kind of at this stage where things are looking like X is just gone unless Elon is willing to concede to some of these demands.
You know, a year ago, Elon Musk was asked by the government of Turkey to ban a bunch of accounts and he went through with it under court order. And the explanation at the time offered was, you know, yes, I'm a free speech absolutist, but the question is either you know, lose access to a handful of accounts in Turkey, or lose access to the service altogether. And he argued, you know, it's better to better to preserve X and Turkey, you know, making the making a different calculation here. Not entirely clear why, although I suppose Musk would argue that there was less transparency, like one of the big reasons he offered at the time for opposing this order was that the judge was was limiting what X could.
Say about it.
I don't know if that's significant enough to put the entire operations in the country at risk, but but of course Elon Musk saw it that way. But what I think is actually going on here is you have Brazilian politics, which Elon Musk has already sort of entered the fray right. He's attempted to cozy up to Bolsonnaro, former.
President, sort of far right president of Brazil, who I believe, Max correct me if I'm wrong, who is closely allied with many of the accounts right on X that the Brazilian Supreme Court wanted to shut down.
Yeah, we know that because Twitter released a sort of sequel to the Twitter Files called the Alexander Files.
That's the first name of the Brazilian justice who ordered.
This banims right and thank you and and so so right.
It was it looked like seven accounts. These are all sort of far right aligne. It really feels like, you know, Elon musk Is, in inserting himself into Brazilian politics, has now you know, decided to make this a thing, just as he's made you know, his engagement in American politics a thing. He's you know, posting memes, he's you know, he's he's going to war over this, and you know, you can debate whether that makes sense as a principal stand I think for X it's not great news because Brazil is a pretty substantial market for social media.
Yeah, it's a big market for them from a user base standpoint, significantly less, you know, important from a financial standpoint. But we don't know exactly how many users because they don't they've never broken those out. We've seen some estimates, I believe E Marketer said it was around forty million monthly active accounts, which would put Brazil probably in the top five, maybe even in the top three, behind the United States and Japan in terms of total size. For X but revenue wise, again, they've never broken it out. I was texting with a source over the weekend and he told me that, you know, it used to be that Brazil was around two percent of global revenue for them, So you know, those numbers obviously could could be adjusted slightly since Elon has taken over. But point being is that it's a small, very small market for them. From a business standpoint, It's it's possible that Elon is making a calculation here saying that, you know, taking this stand does not hurt them very much financially, but the you know, the benefits of being of looking or appearing to be the ultimate free speech guy on a global scale far outweigh what he's losing in actual Yes, And to.
That point, it is my understanding that for not only the far right in Brazil and other places, but also in just some more mainstream conservative circles, this has become a bit of a cause celeb in Brazil. I get the sense that there are a lot of factions who feel like this is a bit of overreach by the Supreme Court there, and then in some ways they are perhaps exacerbating the problem. It feels to me, though, Max like at this point though each side Gimo Eyes, the judge and Elon Musk really just have their backs up and our and our loath to back down at this point.
Right, what's sort of most extreme about this order.
It's not the you know, ordering X to suspend certain accounts, which is, as we said, has happened in other countries and X has complied to argue whether that how significant the question of transparency really is. But this idea of putting a fine on on VPN users like that is a pretty.
Nine thousand dollars a day, don't and I don't know.
That it's enforceable.
Like a lot of authoritarian countries have really struggled to including China, have really struggled to crack down on if you can't use But like.
In Brazil, to be clear, is not an authoritarian country.
I mean, Elon Musk is now saying this is you know, this is evidence, you know, but it is not. No, what I'm saying is there's a real question about whether this can be enforced even but regardless of so that, it's like threatening people with a fine, a significant fine for just for attempting to consume this content like that is pretty that's pretty out there, right, that's pretty far away from what most countries have done in these situations, most democratic countries have done in these situations.
It is something that I learned as a young reporter in Brazil in the late nineteen nineties that the Brazilian Supreme Court likes to exercise its influence. It will not be cowed or bullied by anyone, and certainly not by Elon Musk. And to this point it actually almost seems to have gotten into a bit of a tit for tat sort of personal thing with him that from Afar seems a bit odd.
Now Kurt tell us this.
It seems that another key business of Mosques, SpaceX's starling unit, has gotten ensnared in this whole conflict.
What's the situation there, Well, so, as part.
Of the penalty that the judge is imposing on X includes some financial fines, financial penalties, and X is not paying those fines. But Starlink is in Brazil and prominent in Brazil and has bank accounts in Brazil, and so the judge instead is saying, well, Elon, you know, if your one company is not going to pay the fines that are owed, we will just get the money from your other company, So I believe they froze the bank accounts from Starlink in order to pay these fines. I think this is such an interesting element of this whole thing because we've talked at length on this pod of course, about sort of the constellation of Elon's companies, right, and the benefits at times of him pulling resources from Tesla to benefit others or vice versa. And here we're seeing the real negative of this, you know, Elon connection, because now he's being sort of threatened with one company by another. And this was a huge concern. You have to remember when Elon bought Twitter in late twenty twenty two, this is one of the biggest concerns was like, hey, you have all these other companies where governments could apply leverage on you, you know, in China and India and other places. Are you prepared to deal with the fact that like Tesla could be used as a bargaining chip to get to X and the speech related issues at X. And it's been talked about, but this is the first time I think we've really seen it actually play out in a negative way for Elon.
Yeah, this is that's a really great point, Like this could be a Canarian coal mine situation where we could see other countries, probably not like the US, but but but other countries you know at tempt the same kind of thing. And you know, Elon Musk's SpaceX's response has been like, you can't. This is totally ridiculous. You're conflating, you know, Elon Musk with SpaceX. But it's a little hard to make that argument when you're when you're CEO goes around acting like they're one and the same.
And because he not only.
Not only is the CEO like he is also of Tesla and other companies, but in the case of both SpaceX and of X, he is also majority shareholders.
He not does he not have a majority stake in SpaceX.
I think he definitely is. He's majority control. I'm not sure that he has.
But if you are the majority, you have majority control over company, which again would not be the case with Tesla. I mean you can almost sort of see it right the link. It's it's not crazy, Hey, you own this. You also own that they're all essentially, you know, units of.
A big And again, when you have a guy who goes around saying all these rules are bs, you know, just like, let's just go.
You know, I don't pay attention to the the.
Ins and outs of securities laws like I think it's much easier for regulators say, come on, man, you are SpaceX like and anyone who's looking like, yeah you can. You can talk about the bylaws or whatever or the cap table. But everybody knows, including people who work at SpaceX, that Elon Musk controls SpaceX. He that these companies effectively operate like one conglomerate.
So is it really surprising when.
A judge and you know, in Brazil or anywhere else, treats them as such?
Okay, Max.
So Musk has been eching up a storm about US politics and election, the upcoming election in recent days, including by the way, saying that Kamala Harris supports the banning of X there in Brazil KEX by EKEX.
What's it looked like flipping on X yesterday and seeing, I think, in particular, a post from Elon Musk saying that you know, Kamala Harris has promised to govern as a communist from day one, and then this kind of like AI generated picture of Kamala and a communist outfit that goes beyond just like a campaign ad where you're saying these policies are communists like or or some of the attacks you've seen from Trump and to something that more feels like what we would associate with, right, like disinformation type accounts like It's It. And the other thing he did yesterday that was also quite strange, I thought, is he kind of boosted an in cell adjacent post or a post that was arguing that the world would better off if only high status males were in charge. So again we're really it's really crossing into kind of you know, far right posting twenty four to seven.
I think this is just the consequence of.
Elon Musk, you know, getting involved in the presidential race and is a he's effectively part of Donald Trump's campaign, and so he's posting that way at this point, although posting in his kind of idiosyncratic, extra provocative way.
Now, Kurt, I suppose his argument is going to be that, well, everyone's going to know that my post of Kamala there is just a parody, I will say, having taken a very quick glance at the post. Yeah, it doesn't seem to be anything particularly real about it, right.
Yeah, I mean that would be the argument humor. Right, He's used this sort of humor defense repeatedly since taking over that like, hey, as long as it's funny or it's intended to be funny, you know, it should be fine. I think more than anything, I think what this weekend has just reinforced for me is just the you know, the way in which he is no longer even pretending to keep his thumb off the scale of politics.
Right.
You remember when he first took over Acts, it was very much like, hey, I'm I'm not gonna, you know, turn this into a political.
The I'm just neutral, yeah, right exactly.
And it's just like the we've come so so so far from that kind of initial takeover and initial pledge or promise or or at least framing.
It's just striking right.
Part of the problem here is with Musk's like philosophy of free speech, like this idea that the platforms shouldn't make any decisions, should be all up to the government, and platforms should just be like crazy free for alls and then and then let the government step in number one. It creates the standoffs right where like we're talking about in Brazil, but it also creates you know, all of a sudden, like Elon Musk, the CEO of one of these major companies is acting like you know, any old poster. I don't know, like it it it it's just further eroding trusted and it's almost like daring governments to step in and try to make rules.
And and so I don't know.
I mean, you know, I think there are critiques from both the left and the right over how like Facebook managed misinformation and disinformation, But you know, it doesn't it's not clear to me that this is like an improvement, you know, in any metric.
To Max's point, whatever's legally allowed as fair game. If it's not legal, you know, we're going to take it down. That's not exactly how he does it anyway. Right like this, he when he wants something removed, the account that's following his private plane, if he wants to take what is it?
The word cis.
Right is now like considered a slur in the US if you're if you're on.
X or something like that.
I mean, the point being is that he's very much like, Hey, anything goes as long as it's legal, and with a major caveat being that also if I'm okay with that thing being on X because if not personally, I will make a change as well. And I think that's the big issue is he's not truly free speech absolutist within the law. He says that, but then he makes his own decisions when they suit him, and I think that's where people get frustrated.
He puts his own spin on it.
He also, max, I believe, continues to ex about his potential future role in a Donald Trump administration.
Yeah.
I mean he's.
Disputed a lot of the reporting, you know, including reporting it's based on the actual filings and so on. But in terms of his support of Donald Trump and kind of attempted to play it down in various ways. But this is one thing he's genuinely seems excited about. He's he's ready to serve if called upon. It's like, I don't know what the opposite of a sherman esque denial is, but that's what it is. He's basically raised his hand and said I want to be the you know, efficiency czar, which you know, given Elon Musk has some pretty out there views on the government, you know, it's hard to imagine any of this actually coming to pass. Like, I don't think that Elon Musk will be giving broad leeway to like ru you know, closed federal agencies, but he definitely has that appetite.
All right, we're gonna move on to the launch of the beta version of x TV for Android.
Man, I've been waiting.
For this, man, you know, I'm sure feels the same way.
But like, I'm gonna pivot.
Remind me of what exactly x TV is. This is where we go to watch porn.
Yes, now you can watch porn on your on the big screen at home. It is essentially the idea of video being a big thing on x and that what Elon Musk has wanted pretty much since he got to the company was to have some sort of app on your TV to make it easier to stream these shows Tucker Carlson or Elon Musk interviewing Trump or or whatever else. It's kind of a weird and confused set of ideas that feels like at once kind of caught up in the past, like, hey, it's not real unless it's on the big screen in your living room and also sort of out of touch with like the realities of how videos consumed. But anyway, Yeah, there's a on Android TV which is like one of the platform, one of the operating systems for TVs. It has modest market share. I saw figures around six percent market share, so not a huge amount. But you can download, you can get this x TV app and you know, watch that Tucker, that great hard hitting Tucker interview or whatever else you know, in the comfort of your home on the big screen.
Kurt expectations from you for XTV.
I think it's a huge waste of time and resources for the company, to be honest with you, I mean, I think Max sort of flicked at it right, like this isn't what. I don't know anybody who's clamoring to bring the x videos they see scrolling through their phone and blast them onto the sixty inch TV in their living room.
So I just think, like, well, can.
I just say for one second, car hold on, let me just say everyone age as.
I as being the old man in the room here, as I will have to say, as I watch my.
Daughter or my nephews and nieces and they watch everything, games and everything just on their phones, and I'm like, as the I'm like it is slightly unsatisfying to me, Like I need I need a big come on, give me a big screen or something. So I'm all over X David.
This is what I was going to say.
This would make sense if there was a huge library of high quality videos that were worthy of being on your TV. Right, Like, let's pretend this whole Don Lemon, Tucker Carlson, WWE whatever, the big push into premium video that they announced earlier this year. Like, let's pretend that worked and they had thirty different shows.
Okay, Like, sure.
You want to watch your Tucker Carlson show on the big TV, Like, David, you go for that and you can.
Keep that popcorn.
Yeah, there's like two shows. There's like two shows.
So I'm just saying my When I said it, I thought it was a waste of time and resources. It's because they don't have the content that really merits going on a live TV to to spend the time on this, in my opinion, and.
They will not be acquiring content elsewhere, Like they can't flick Style.
They'd like to, but it's it's easy to want to do that stuff. I mean, this stuff is incredibly expensive. This is not a company that has a lot of extra cash. It's competitive, right like Amazon, Fit, Amazon, Apple, all these other companies they want the high quality stuff too.
They're not just gonna let X have it.
So I just think it's you know, I don't know in the universe of things they could do.
I just don't think it's a good space.
You got me Card, you convinced me. You convinced me. Max. We never sort of brought it up.
You and David you put it.
You you brought made a good.
Point, which is like with the porn joke, which is that if anyone has like tried to like search, like look at X, like at A on a workplace computer, you are aware of the dangers of looking at X on a large screen.
Like It's just it is.
It is not associated with the kind of content that Kurt is talking about. So you're you're not just talking about like the technical challenge of like building apps for all these platforms Set top Box. That market is really really fractured. They're all these players. You're gonna have to build all these different apps, you have to work on all these different business deals, and you're gonna have to change the fact that most people don't see X the way that Elon Musk wants us to see it.
There we are, We're gonna we're gonna end this episode.
Uh, I don't gonna pitch pitch my show here?
Well what is your show?
All right?
So I well, I was just trying to think about what content that might work. Kurt's talking about, you know the fact that we don't have Tullsia's you know that we you know, the cut in offerings right now are limited, and I'm trying to think, like, okay, what what is realistic? Because Elon Musk doesn't have zasloft dollars. He's not going to spend huge amounts of money to buy content. He's not gonna he's not gonna pay Oprah zillion dollars. But and the you have the brand problem. So what works in next is Elon Musk? Right, we all agree like Elon Musk content so basically keeping up with the Kardashians. But Elon Musk's various complicated family arrangements like just call it like repopulating the earth or something, and you know, just just like go full reality. He already kind of wants to be a kardash and let's like let's do it. I think it'd be a huge hit.
It actually would be a huge hit.
It will be Yeah, that's as crazy as that would be.
If if any if Linda Yakarino or anyone else from Max is listening, Max Schinda, call me exactly all right, and so you don't like my cage match? I didn't you would do? You would start with the cage match? No no, no, no, no, actually scraped that. You would need to build to the cage match Musk versus Zucker, but you'd build slowly building.
I hadn't thought, honestly to be you know, maybe it's just like labor day brain I was. I hadn't considered the cage match. But that is also a really good idea.
I mean, you know, that would put that would put this app on a must download list for me if we were getting to watch elon Zuck.
And then on top of that, let me paint a picture for you, David, just real quick.
Max Scott his show we've you know, lightheartedly mocked my high school football career, But imagine kicking back on the couch of the bowl of popcorn and pulling those highlights up and watching those on the big screen. I don't know, I mean, it's hard for me to picture a better way to spend a holiday weekend.
Whoa, whoa, my understanding.
Nothing high school football clips.
He was eighteen.
Yeah, that's right, Yeah seventeen, thought all yeah.
No, Kurt, we're gonna, we're gonna Max and I are gonna consider that one. We're gonna get back to you, never on it. Thank you for pitching, Max, Kurt, thanks for joining.
Great to be here.
Thank you.
This episode was produced by Stacy Wong. Naomi Shaven and Rayhan Harmanci are senior editors. The idea for this very show also came from Rayhan. Blake Maples handles engineering, and we get special editing assistants from Jeff Grocott, our supervising producers Magnus Hendrickson.
The Elon Inc. Theme is written and performed.
By Taka Yasuzawa and Alex Sugiira. Brendan Francis Newnham is our executive producer in Sage Bauman is the head of Bloomberg Podcasts. A big thanks as always to our supporter Joel Weber. I'm David Papadopolis. If you have a minute, rate and review our show, it'll help other listeners find us.
See you next week.
