Elon Musk’s ongoing dispute with Brazil over the ban of social media platform X could potentially affect his other businesses, warns Wall Street Journal business columnist, Tim Higgins.
What Happened: Brazil’s ban on X has started to impact other parts of Musk’s business empire. Higgins highlighted during CNBC “Squawk Box” on Tuesday that Musk’s other ventures, such as SpaceX, Tesla TSLA and the Starlink satellite system, have been finding success in rural parts of Brazil, indicating potential future business growth in the market.
However, Musk’s principled stand against Brazil’s government, which he accuses of breaking its own laws by asking X to silence political speech, could jeopardize these opportunities. Specifically, operations of Starlink have been frozen in Brazil, leading to a halt in revenue generation.
“What we have seen over the last few years as he has increasingly become more involved in X, become more outspoken,” Higgins said.
Despite these challenges, investors seem to remain patient, giving Musk “a lot of rope” to manage his affairs with X, as they see great potential and returns in Tesla and SpaceX.
Why It Matters: Earlier, Musk had threatened to seize Brazilian government assets unless property belonging to his companies X and SpaceX was returned. This was in response to the confiscation of SpaceX and X’s properties by the Brazilian government.
Subsequently, Musk’s satellite broadband company, Starlink, decided to comply with a Brazilian court order to block access to social media platform X in Brazil, reversing its previous stance. This move, while in compliance with the court order, has led to a halt in Starlink’s operations in the country, impacting revenue generation.
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This story was generated using Benzinga Neuro and edited by Pooja Rajkumari
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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