Trump Media thinks Elon Musk’s ‘commitment to free speech’ could take users from Truth Social

There are a lot of threats to Trump Media & Technology Group’s business, at least according to the company. Among them are risks from former president Donald Trump’s involvement, media coverage, and competition from Elon Musk’s X, the company has said in regulatory filings.

Trump launched his social media platform, Truth Social, in February 2022, after he was booted from major sites like Facebook and X (then Twitter). The site was marketed as a conservative answer to mainstream social media platforms, and has billed itself as a “platform for all Americans to freely express themselves.”

But the company is worried about a monopoly on free speech.

In a preliminary prospectus filed with the Securities and Exchange Commission dated Friday, Trump Media detailed its plans to issue millions more shares of its common stock tied to previously issued public warrants, as well as registering the resale of company securities.

Within the filing, Trump Media laid out several of the risks to its business. One of those was X’s business model under Musk. “As a private company under new ownership, X may demonstrate a sustained commitment to free speech principles that will heighten competition for users who prioritize such principle,” Trump Media remarked.

When SpaceX and Tesla CEO Musk completed his purchase of Twitter in October 2022, he acknowledged that the site could not become a “free-for-all hellscape, where anything can be said without consequences.” Instead, Musk said he was setting out to create “a common digital town squarewhere a wide range of beliefs can be debated in a healthy manner, without resorting to violence.” The Tesla and SpaceX CEO is a self-proclaimed “free speech absolutist.”

One month after the acquisition, Musk reinstated Trump’s account. But the former president has stuck to Truth Social for messaging, in hopes of drawing more users to the platform.

In May, Truth Social had 4.2 million daily web visitors, according to data from Similarweb shared with Quartz. That’s compared with approximately 1.1 billion in daily traffic on Musk’s X for the same month.

According to Similarweb, aside from a bump to web traffic around the time of the IPO, Truth Social visits are dropping across both web and social with the former president’s criminal trial and campaign having little effect.

Another challenge to Trump Media, according to the filing, includes Trump’s “ability to significantly influence the outcome of matters submitted to TMTG’s stockholders for approval, including the election of directors and any merger, consolidation, or sale of all or substantially all of the TMTG’s assets.” Trump holds nearly 65% of outstanding common stock in the company as of June 10.

Factors outside of the company’s control, including lawsuits over content posted to Truth Social and other matters, natural disasters, economic downturn, and software issues, could also pose risks to the company and shareholders.