Sometimes even being owned by a billionaire isn’t good enough

Note: I originally wrote this for the daily newsletter at the Columbia Journalism Review, where I am the chief digital writer

Before COVID-19 put the final nail in a number of media coffins, one of the escape routes that many journalists dreamed about was for their organization to be bought by a billionaire. After all, the Washington Post seemed to lead an almost charmed life from the moment it was acquired in 2013 by Jeff Bezos, Amazon’s founder and chief executive (currently the richest man in the world with a net worth of about $150 billion). While others were cutting back because of an ongoing decline in ad revenue, the Post continued hiring, because Bezos said that the paper was in “investment mode,” and didn’t really need to turn a profit immediately. But even billionaires often reach a point where the business part of what they are doing takes precedence — after all, that kind of thinking is why many of them became billionaires, and you didn’t. And what just happened at the Atlantic magazine is one of the latest examples.

David Bradley, the magazine’s chairman and former controlling shareholder — who sold the Atlantic to Laurene Powell Jobs in 2017 for an undisclosed sum — announced that the company is cutting 68 jobs, or about 17 percent of its staff, and instituting a pay freeze for those who remain (executives are also taking pay cuts). Of the editorial positions that are being removed, about half are on the video team, and the other half appear to be staff who worked for the Atlantic‘s event business, which — like many other media companies — it has been building up for some time as an alternative to advertising revenue. The coronavirus, as Bradley pointed out in his memo, has effectively nuked that business, and no one is quite sure if or when it will ever return. “We would have paused over furloughs instead of severance if we believed the positions were coming back,” Bradley said in his memo to staff.

All of these business realities are just that — reality. Anyone who has been following the media business knows that it was in poor financial shape even before COVID-19. But the Atlantic stands out in part because it has been firing on all cylinders, both in journalistic terms and in business terms. The magazine launched a paywall, and Bradley said that it has been very successful, bringing in 90,000 new subscribers in just the past month, for a total of 450,000. One of the reasons for that growth is likely the excellent journalism that the Atlantic has have been turning out, not just on the coronavirus — where Ed Yong has become a must-read for his in-depth, analytical takes — but on other topics as well. So this leads to the obvious question: if you are doing literally everything right, subscribers are growing, and you are owned by a billionaire (Powell Jobs is worth about $26 billion at last count), and yet you still lose almost 20 percent of your staff, what chance does anyone else have?

Defenders of Powell Jobs would argue that the investment vehicle through which she bought the Atlantic, the Emerson Collective, is exactly that — an investment fund, not a charitable foundation. So it makes acquisitions based on social principles, like the ones that Powell Jobs said she was interested in when she bought the Atlantic in the first place, when she praised its mission to “illuminate and defend the American idea,” but these investments are also expected to run as businesses. And if the video business and events business are decimated, what rationale is there for keeping those staff on? At the same time, many observers of the layoffs were justifiably frustrated with the outcome. What is the point of being owned by a billionaire if they can’t cut you a little slack in order to let you slide through a rough period? Marc Benioff, the billionaire who owns Time magazine, promised that there would be no cuts (although he made it clear that guarantee would only last for three months).

To be fair, Powell Jobs’ decision not to give the Atlantic a little more rope isn’t the worst billionaire turnaround on an editorial investment — that title would probably have to go to Joe Ricketts, the billionaire founder of the online brokerage firm TD Ameritrade, who in 2017 abruptly shut down DNAinfo, the local news startup he founded, as well as Gothamist, the network of city-focused blogs that he acquired just a few months before that. According to a number of news reports, Ricketts decided to close his publications because he was upset about the fact that editorial employees organized a union. So if you’re dreaming that maybe a billionaire will come and save your publication and make sure everyone keeps their jobs, you should be careful what you wish for.

Here’s more on billionaires and the news:

Cloudy Quartz: Quartz, the business news site that was originally founded by Atlantic Media, announced a week ago that it was laying off 80 employees, or nearly half of its total workforce, with the bulk of the cuts focused in the advertising department. The site also said it would close its offices in London, San Francisco, Hong Kong and Washington. Quartz was acquired in 2018 by a Japanese company called Uzabase, a media and business intelligence provider with a market value of close to $1 billion.

Billionaire pique: In a piece for CJR, Hamilton Nolan looked at Ricketts’ closure of DNAinfo and Gothamist and billionaires losing interest in the media. “Not since the 19th century have so many individuals had so much power over the press,” said Nolan. “It’s important to remember that Ricketts only had that power because no one else wanted to spend the money to do what he was doing. That is not meant to suggest he should be considered a heroic failure, it’s mainly to say that an industry that relies on the Joe Rickettses of the world to sustain itself is in deep trouble.”

That LA feeling: Earlier this month, the editorial union at the Los Angeles Times — which is owned by medical-technology billionaire Patrick Soon-Shiong — agreed to accept a 20-percent reduction in both pay and hours of work, as a way of avoiding layoffs or furloughs. Journalists at the paper, which signed its first-ever collective agreement last fall, agreed to have their wages and hours cut for 12 weeks starting May 10, and management promised not to lay anyone off during that period. The paper’s parent company, California Times, also folded three of its weekly community newspapers, and laid off 14 people who produced them.

Other notable stories:

In a column written for Slate, Ashley Feinberg takes a critical look at New York Times media writer Ben Smith’s recent column on investigative reporter Ronan Farrow, and the accusation that Farrow played fast and loose with the facts because of a penchant for “resistance journalism.” Feinberg said that an examination of Smith’s column “reveals a shakiness in his indictment. Had Smith taken a more rigorous approach to presenting his findings, he would have undermined his own argument. So instead, Smith chose to perform broad-mindedness, sacrificing accuracy for some vague, centrist perception of fairness.”

In its diversity report, the New York Times says that women now represent 51 percent of the company’s staff and 49 percent of its leadership, while people of color now represent 32 percent of the Times‘ staff and 21 percent of its leadership. Each of these numbers increased over last year, the paper said, with women making up 53 percent of new hires in 2019 and people of color making up 43 percent. But the company admitted that it still has “gaps in representation at the leadership level, particularly of people of color” and that it needs to continue to ensure that “new hires are a diverse group.”

National newspapers in the UK no longer have to make their print circulation figures public, according to a decision by the Audit Bureau of Circulations, an industry group run by the country’s major publications that tracks newspaper data. News UK, which publishes the Sun and Times, was one of the first to make its circulation numbers private, so that only advertising agencies that have signed confidentiality agreements will be able to see them. The bureau said the change in reporting “addresses publisher concerns that monthly ABC circulation reports provide a stimulus to write a negative narrative of circulation decline.”

Apple is in the early stages of developing a series about Gawker, the blog network that was forced into bankruptcy after a lawsuit by former wrestler Hulk Hogan, according to a report in Vanity Fair. The magazine says the show was conceived and pitched by two former Gawker staffers, Max Read and Cord Jefferson, who have been working on scripts for the past couple of months with a writers room that apparently includes some other Gawker alumni. Read was the editor-in-chief of Gawker at one point, but stepped down in 2015, and later joined New York magazine. Jefferson left Gawker to work in the TV industry, and has credits on shows including Watchmen and Succession.

Some of the reaction to the New York Times‘ recent decision to stop using third-party advertising services portrayed the change as good for privacy because there wouldn’t be any more tracking of personal information. But Mike Masnick notes at the technology news-analysis site Techdirt that this is a misunderstanding, and that the Times will be doing just as much personal tracking as third-party services were. The paper “is doing the same thing that Facebook and Google have done,” he says. “It’s collecting data on its users, and then using that data to sell access to advertisers. Why is that evil ‘selling data’ when it comes to those other companies but ‘good’ when it’s the NY Times?”

What made news valuable in the past was the speed at which journalists could collect and disseminate information, Michael Socolow writes for the Nieman Journalism Lab, and that was useful for commercial information and for public service or social value. But that same impulse can produce a rush for novelty, he says, and that can “prioritize sensationalism over depth, and elevate the newest tidbit of information over more important reporting.” This is why the press are obsessed with reporting on irrelevant ephemera like the president’s tweets about whether a cable TV host had someone murdered, or the ratings for his virus press conferences.

The Times Group in India — a media giant that owns 45 daily newspapers and magazines, including the Times of India and the Economic Times, as well as a series of TV and radio channels and websites — has cut staff salaries and deferred pay raises, according to a report from a media industry site called News Laundry. The site says it has also laid off “dozens of staffers” at the Economic Times, but hasn’t revealed the exact number. According to the site, more than a dozen current and former staffers of the Times Group said HR managers were being secretive about the layoffs.

The “Some Good News” YouTube channel started by actor and comedian John Krasinski as a way to alleviate the COVID-19 gloom has been licensed to ViacomCBS following what some entertainment magazines describe as a “massive bidding war.” Krasinski, who is already under contract with ViacomCBS for a number of movie projects, will no longer host the series, but will be involved as an executive producer.

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