X Rebranding Could Create Legal and Financial Difficulties for Twitter
The process of rebranding Twitter as X is progressing smoothly. The company’s San Francisco headquarters no longer prominently display the name and famous bird logo, and instead, an “X” has taken its place on twitter.com. According to Elon Musk, this transformation goes beyond a mere name change. He envisions turning the platform, previously known as Twitter, into a comprehensive “everything app” that includes banking and financial services.
However, the rebrand could pose significant legal and financial challenges for the company, which has struggled since an advertiser exodus cut the company’s ad revenue by more than 50 percent. First, hundreds of companies, including Microsoft and Meta, own trademarks for variations of X. That could open the door to lawsuits and other legal headaches for Musk.
Syracuse University law professor Shubha Ghosh says lawsuits are “pretty common” when large companies rebrand and change their names and logos. “I’m kind of surprised he chose X because it’s not that distinctive,” he says. “It’s problematic in that you can’t suddenly do it without someone noticing and potentially suing.”
Trademark attorney Josh Gerben told Reuters he counted nearly 900 other companies that trademarked X. And while not everyone can credibly claim that the company formerly known as Twitter is interfering with their brand, that makes X an easy target.
“There is about a 100% chance that both opportunistic and legitimate claimants will sue Twitter/X over the new name,” Gerben tweeted. “The company could easily spend tens of millions (if not more than $100 million) in legal fees and settlements trying to obtain trademark registrations for ‘X’ and dealing with the litigation likely to result from the rebrand.”
For the same reasons, Twitter’s new X brand may also prove difficult to defend, especially internationally. “The likelihood that @elonmusk will be able to trademark ‘X’ for all the services he plans to offer in all the countries he wants to offer them is very slim,” Gerben wrote.
Even if Twitter is able to fend off legal challenges, removing a globally recognizable brand like Twitter carries serious business risks. Bloomberg reports that some analysts have estimated that the name change could wipe billions of dollars from a brand already damaged by Musk.
Ari Lightman, a professor of digital media marketing at Carnegie Mellon University, says Twitter’s problems extend far beyond potential legal headaches from its rebrand. “There’s a lot going on that diminishes the value, utility and uniqueness of Twitter, now X,” he says, referring to the rise of Threads and other Twitter competitors. “Tweets are synonymous with this idea of blogging or microblogging, it’s very difficult to connect the concept to the world’s population.”
