Elon Musk’s impulsive reactions to competitive products or opinions he dislikes are having an outsized impact on the media industry, which represents some of Twitter’s most hyper-engaged users.

Why it matters: Musk has forced news companies to choose between their commercial interests and their values. Until now, business needs have won out, but the industry is beginning to reach a breaking point.

Driving the news: Musk on Sunday added a new "government funded" label to a few select media outlets that receive some funding from the government, including NPR and BBC.

• BBC is pushing back on the move, arguing that it is independent and funded by the British public through the license fee.
• NPR's business reporter Bobby Allyn reported that Musk plans to apply that label to "a larger number of institutions,” but it's unclear exactly how he plans to use the new label.
• As of Sunday evening, Twitter's posted policies do not appear to have been updated to reflect Musk's latest statements.

Catch up quick: The new label follows a chaotic back and forth between Musk and NPR last week over why Musk is choosing to label certain accounts but not others.

• Twitter originally added a “US state-affiliated media” label to NPR’s main Twitter account, without explanation or warning, in what appeared to be a direct violation of Twitter‘s previously stated policies.
• When pressed by NPR, Musk couldn’t provide a reason for the label on NPR's account and not others, but he said he'd look into it.

Between the lines: Musk has been known to take more targeted actions against specific newsrooms or journalists that he dislikes, often without a good explanation as to why those actions violate Twitter’s policies.

• Musk last week disabled the ability for users to share links to newsletters authored in Substack, the email publishing platform.
• The move appeared to be in response to Substack's introduction of a new feature Wednesday called Substack Notes that allows writers to produce short posts resembling tweets for the platform.
• Musk later tried to claim that Twitter never blocked Substack links. Over the weekend, Twitter reversed its decision, making Substack links available on Twitter, but search queries for Substack still show up blank.

Musk's move clearly rattled Substack writers, including some of Musk's favorite authors.

• On Friday, Matt Taibbi, a veteran writer who Musk handpicked to feed a leak of thousands of Twitter documents, said he would use Substack Notes instead of Twitter because of Musk's moves.
• "Elon Musk supports freedom of speech (except for journalists, bloggers, critics, competitors, anti-fascist activists and his workers)," tweeted Substack author Max Berger.

Catch up quick: Last year, Musk suspended accounts for rival Mastodon, and blocked tweets linking to its service, after it tweeted about a Twitter account that used public information to track Musk's private jet.

• He also suspended accounts for several tech journalists at major news outlets who cover Musk, alleging they were being punished for breaking Twitter's rules about tweeting links to the Mastodon version of the jet-tracker.
• Some journalists hadn't even tweeted links, but rather screenshots of the account, which didn't appear to technically violate Musk's new rule.

Musk hasn't been shy about his feelings towards the press, arguing in favor of "citizen journalism" as a counter to mainstream publications.

• After firing all of its communications staff, the company last month set Twitter's longstanding email account for handling press inquiries to respond automatically with the "poop" emoji.
• "I'm not saying we should somehow downplay the major publications or prominent journalists. I'm simply saying we should elevate people and give voice to the people — much more, " Musk said on a Twitter Spaces chat, shortly after buying the company.

Be smart: NPR said it would stop posting content to Twitter in response to the incident, but most news organizations haven’t been able to bring themselves to do so.

• Case in point: The Athletic, a sports news site owned by The New York Times, was running ads on Twitter as of April 3, despite the fact that Musk had removed the verification check mark from The Times’ main account days before.
• Twitter removed The Times' check mark the day after a new verification policy went into place, but didn’t remove it from any other news organization. Shortly after, Musk called The Times’ work “propaganda,” alluding that the move wasn’t a technological glitch.
• Last year, The Washington Post continued to run ads on Twitter, weeks Musk suspended the accounts of two of its reporters.

The big picture: In opting not to pay to remain verified on Twitter, many news organizations are signaling that they no longer view Twitter as a platform that organically elevates authoritative journalism.

Yes, but: They still view it as a marketing opportunity.

• A slew of mainstream publications, including The Washington Post, The Wall Street Journal, Forbes, Fortune, The Information and Puck, continued to advertise on the platform, as of April 3.
• Dozens of others, as of January, were still slated to execute content partnership deals with the platform.

The bottom line: Musk has claimed that his ownership would bring more "free speech" to Twitter, but he frequently appears to bend Twitter's rules to punish those he views as enemies — with media heading the list.

What to watch: Musk's "free speech" principles are also under siege around the globe by dictators and government demands.

• Musk has said that Twitter will obey laws around the world.
• On Friday, The Hindu Times reported that Twitter appeared to have blocked a tweet from a journalist globally in response to a “legal demand” from India's government.
• In the past, in response to government orders, Twitter has typically only restricted distributing those tweets in the country requesting the takedown.

Go deeper: At Elon Musk's Twitter, speech is anything but free