Elon Musk seems to be on a feud with the advertisers after acquiring Twitter

Hours before news broke on Thursday that he had completed his $44 billion acquisition of Twitter, Elon Musk wrote an open letter to advertisers stressing that he doesn't want the platform to become a "free-for-all hellscape."

But that attempt at reassuring the advertising industry, which makes up the vast majority of Twitter's business, was quickly overshadowed by Musk's first days as the new owner of the platform. Some industry experts are now predicting an advertiser exodus could be coming sooner than expected.

Within the first 24 hours of his ownership, there were several reports that racist comments hate speech and other objectionable content had increased significantly on Twitter as users tested Musk's promise that he would allow "free speech" on the platform. Then over the weekend, Musk was widely criticized for tweeting (then deleting without providing a reason) a link to a fringe conspiracy theory about the violent attack on Paul Pelosi, husband of House Speaker Nancy Pelosi.

"I think advertisers are bracing to leave," said Claire Atkin, co-founder of the adtech watchdog Check My Ads. "It's very possibly a seismic shift for marketers and advertisers." After months of uncertainty about Musk's pending acquisition, advertisers must now confront questions about how Musk will change the platform, which is already an also-ran in the digital ad space despite its outsized political influence. Musk, known as both an innovative entrepreneur and an erratic figure, has promised to rethink Twitter's content moderation policies and undo permanent bans on controversial figures, including former President Donald Trump.

Brands have long been sensitive to the types of content their ads run against, an issue made more complicated by social media. Most marketers bristle at the thought of having their ads run alongside toxic content such as hate speech, pornography, or misinformation. And if Twitter continues to struggle with an uptick in such content — or if Musk updates Twitter's policies to explicitly allow some of it — companies may cease advertising there for fear of risks to their brands, or because they're reaching a smaller audience if regular users also depart.

"If you think about the money, investment and care, real care and attention that goes into connecting with consumers, and then to have your ad be published next to lies … it goes against everything a brand wants to do," Atkin said.

Musk, who has previously tweeted "I hate advertising" and indicated he wants to make the platform less reliant on it, is also confronting the reality that about 90% of Twitter's revenue comes from advertising. In addition to the open letter to advertisers, Musk's team spent Monday "meeting with the marketing and advertising community" in New York, according to Jason Calacanis, a member of Musk's inner circle.

In public and private conversations with advertisers, Twitter has also stressed that its content policies have not changed following the acquisition, and Musk has said they won't change until a new content moderation council is appointed (apparently to replace the company's existing Trust and Safety council).

But Musk may face an uphill battle. Twitter's digital advertising business is much smaller than those of Meta, Google, and Amazon, and doesn't have the growth and user demographics of TikTok. And many brands have already reduced digital ad spending in recent months amid the economic downturn. It may not take much for brands to cut back more.