EU Considers Calculating X Corp Fines by Including Revenue From Elon Musk’s Other Firms

Gian Volpicelli and Samuel Stolton, reporting for Bloomberg*:

Under the EU’s Digital Services Act, the bloc can slap online platforms with fines of as much as 6% of their yearly global revenue for failing to tackle illegal content and disinformation or follow transparency rules. Regulators are considering whether sales from SpaceX, Neuralink, xAI and the Boring Company, in addition to revenue generated from the social network, should be included to determine potential fines against X, people familiar with the matter said, asking not to be identified because the information isn’t public. [...]

X is a private company under Musk’s sole control. In considering revenue from his other companies, the commission is essentially weighing whether Musk himself should be regarded as the entity to fine as opposed to X itself, the people said. Tesla Inc.’s sales would be exempt from this calculation because it’s publicly traded and not under Musk’s full control, one of the people said. The commission hasn’t yet decided whether to penalize X, and the size of any potential fine is still under discussion, the people said.

It’d be one thing if X had been split off into a subsidiary of a larger original company, specifically to decrease the size of any potential revenue-based penalty. Like, say, if Apple suddenly decided to break off “iOS” into an independent company that licensed software to Apple to include on iPhones. But we all know that’s not what X is. X was Twitter, which was a publicly-traded company that Musk had no stake in, and which he then bought and made private.

If the EU actually decides to include revenue from SpaceX and Musk’s other companies in calculating a penalty against X, it would effectively be playing a one-sided form of Calvinball, where the rules just get made up out of whole cloth as they go along. (Except in “real” Calvinball, both sides get to change the rules as they see fit.) They’re the ones who chose percentage-of-global revenue as the basis for potential penalties. It’s not Musk’s fault that X Corp generates embarrassingly little (and decreasing) revenue. Wait, actually, that is his fault. He bought a bad business and made it a lot worse. It’s just not his fault that running X Corp into the ground financially means that he can pay any potential revenue-based penalty out of his pocket change.

* You know.

★ Monday, 21 October 2024