A New Haven-centric view of Digital First’s latest woes

The Register in June 2013, shortly after a redesign.
The Register in June 2013, shortly after a redesign.

This article was published earlier at The Huffington Post.

The end may be near for one of the most widely watched experiments in local journalism.

Early today, Ken Doctor reported at the Nieman Journalism Lab that Digital First Media was pulling the plug on Project Thunderdome, an initiative to provide national and international content to the company’s 75 daily newspapers and other publications and websites. Soon, Doctor added, Digital First’s papers are likely to be sold.

Judging from the reaction on Twitter, the news came as a shock, with many offering their condolences and best wishes to the top-notch digital news innovators who are leaving — including Jim Brady, Robyn Tomlin and Steve Buttry. But for someone who has been watching the Digital First story play out in New Haven for the past five years, what happened today was more a disappointment than a surprise.

I first visited the New Haven Register, a regional daily, in 2009. I was interviewing people for what would become “The Wired City,” a book centered on the New Haven Independent, a nonprofit online-only news site that represents an alternative to the broken advertising-based model that has traditionally supported local journalism. The Register’s corporate chain owner, the Journal Register Co., was in bankruptcy. The paper itself seemed listless and without direction.

Two years later, everything had changed. Journal Register had emerged from bankruptcy and hired a colorful, hard-driving chief executive, John Paton, whose oft-stated philosophy for turning around the newspaper business — “digital first” — became the name of his blog and, eventually, of his expanded empire, formed by the union of Journal Register and MediaNews, the latter best known for its ownership of the Denver Post.

Just before Labor Day in 2011, Matt DeRienzo — then a 35-year-old rising star who had just been put in charge of all of Journal Register’s Connecticut publications, including the New Haven Register — sat down with me and outlined his plans. His predecessor had refused my requests for an interview; DeRienzo, by contrast, had tracked me down because he’d heard I was writing a book. It seemed that a new era of openness and progress had begun.

The openness was for real. The progress, though, proved elusive. For a while, John Paton was the most celebrated newspaper executive in the country, the subject of flattering profiles in the The New York Times, the Columbia Journalism Review and elsewhere. Media reporters were charmed by his blunt profanity, as when he described a presentation he gave to Journal Register managerial employees. “They were like, ‘Who’s the fat guy in the front telling us that we’re broken? Who the fuck is he?'” Paton told the CJR.

In 2012, though, Journal Register declared bankruptcy again — a necessary step, Paton said, as it was the only way he could get costs such as long-term building leases and pension obligations under control. After Journal Register emerged from bankruptcy in 2013, Paton’s moment in the national spotlight seemed to have passed, as media observers turned their attention to a new breed of media moguls like Amazon.com founder Jeff Bezos (who bought The Washington Post), Red Sox principal owner John Henry (who bought The Boston Globe), greeting-card executive Aaron Kushner (who acquired the Orange County Register) and eBay founder Pierre Omidyar (who launched a new venture called First Look Media).

Although Digital First’s deepening woes may have escaped national attention, there were signs in New Haven that not all was well. Some positive steps were taken. The print edition was redesigned. The Register website was the beneficiary of a chain-wide refurbishing. Nasty, racist online comments were brought under control, and the newsroom embraced social media. But larger improvements were harder to accomplish.

Among the goals Matt DeRienzo had talked about was moving the paper out of its headquarters, a hulking former shirt factory near Interstate 95, and opening a smaller office in the downtown. In 2012, the Register shut down its printing presses and outsourced the work to the Hartford Courant. The second part of that process never came, though. Just last week, the New Haven Independent reported that the Register had backed away from moving to a former downtown mall facing New Haven Green. Two months earlier, according to the Independent, the Register and Digital First’s other Connecticut publications laid off 10 people.

Neither development should be described as a death knell. The downtown move is reportedly still in the works. And the 10 layoffs were at least partly offset by the creation of six new digitally focused positions. But rather than boldly moving forward, the paper appears to be spinning its wheels. And now — or soon — it may be for sale.

One of the biggest problems Digital First faces is its corporate structure. Can for-profit local journalism truly be reinvented by a national chain whose majority owner — Alden Global Capital — is a hedge fund? People who invest in hedge funds are not generally known for their deep and abiding affection for the idea that quality journalism is essential to democratic self-goverance. Rather, they want their money back — and then some. Preferably as quickly as possible.

No matter how smart, hard-working and well-intentioned John Paton, Jim Brady, Matt DeRienzo et al. may be, the Digital First experiment was probably destined to end this way, as chain ownership generally does. I wish for a good outcome, especially in New Haven. Maybe some civic-minded business leaders will buy the paper and keep DeRienzo as editor. And maybe we’ll all come to understand that the best way to reinvent local journalism is at the local level, by people who are rooted in and care about their community.

Conflicts of interest and the new media moguls

5790408612_8952178d3f_mWashington Post executive editor Martin Baron has rejected a demand by a group of left-leaning activists that the Post more fully disclose Amazon.com’s business dealings with the CIA.

Nearly 33,000 people have signed an online petition put together by RootsAction, headed by longtime media critic Norman Solomon, to call attention to Amazon’s $600 million contract to provide cloud services to the CIA. The Post’s owner is Jeff Bezos, the founder and chief executive of Amazon. Here is the text of the petition:

A basic principle of journalism is to acknowledge when the owner of a media outlet has a major financial relationship with the subject of coverage. We strongly urge the Washington Post to be fully candid with its readers about the fact that the newspaper’s new owner, Jeff Bezos, is the founder and CEO of Amazon which recently landed a $600 million contract with the CIA. The Washington Post’s coverage of the CIA should include full disclosure that the sole owner of the Post is also the main owner of Amazon — and Amazon is now gaining huge profits directly from the CIA.

Baron, in his response, argues that the Post “has among the strictest ethics policies in the field of journalism, and we vigorously enforce it. We have routinely disclosed corporate conflicts when they were directly relevant to our coverage. We reported on Amazon’s pursuit of CIA contracts in our coverage of plans by Jeff Bezos to purchase The Washington Post.” Baron goes on to point out that the Post has been a leader in reporting on the National Security Agency and on the CIA’s involvement in the Colombian government’s fight against an insurgency, writing:

You can be sure neither the NSA nor the CIA has been pleased with publication of their secrets.

Neither Amazon nor Jeff Bezos was involved, nor ever will be involved, in our coverage of the intelligence community.

(Note: I first learned about the petition from Greg Mitchell’s blog, Pressing Issues.)

The exchange between RootsAction and Baron highlights the conflicts of interest that can arise when wealthy individuals such as Bezos buy in to the newspaper business. It’s a situation that affects The Boston Globe as well, as its editors juggle the lower-stakes conflict between John Henry’s ownership of the Globe and his majority interest in the Red Sox.

Baron himself is not unfamiliar with the Red Sox conflict, as the New York Times Co., from whom Henry bought the Globe, owned a minority stake in the team and in New England Sports Network, which carries Red Sox games, during most of Baron’s years as Globe editor.

The way the Globe handled it during those years was just about right: don’t disclose in sports stories, but disclose whenever the paper covers the Red Sox as a business. Current Globe editor Brian McGrory has insisted that Henry will not interfere. Henry, in a speech before the Greater Boston Chamber of Commerce last week, said he would not breech the wall of separation between the Globe’s news operations and its business interests.

Of course, it’s not as though the era in which news organizations were typically owned by publicly traded corporations was free of such conflicts. (The Times Co., after all, is a publicly traded corporation, though the Sulzberger family calls the shots.) Media critic Danny Schechter noted in his book “Embedded: Weapons of Mass Deception” that MSNBC — then in its pre-liberal phase — was a cheerleader for the war in Iraq even as its then-corporate parent, General Electric Co., was a leading military contractor.

But the rise of a new breed of media moguls such as Bezos, Henry and Aaron Kushner of the Orange County Register, who buy their way into the news business with their own personal wealth, seems likely to bring the issue of conflicts to the fore. The same is true of a media entrepreneur of a different sort — eBay founder Pierre Omidyar, who is launching an online venture called First Look Media with (among others) the journalists Glenn Greenwald and Laura Poitras.

It is the very fact that these individuals have been successful that makes them such intriguing players in the quest to reinvent the news business. But disclosure and non-interference need to be at the forefront of their ethical codes.

Pierre Omidyar’s dicey embrace of nonprofit status

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Pierre Omidyar

New York University journalism professor Jay Rosen, who’s part of the high-profile news project being launched by the tech entrepreneur Pierre Omidyar, writes that the operation’s journalism will be incorporated as a 501(c)(3) nonprofit.

But will it really be that simple? As I wrote earlier this year, the IRS has cracked down on 501(c)(3) status for journalism, apparently (it’s not entirely clear) because the agency doesn’t consider journalism to be an approved “educational” activity.

Rosen calls the venture, to be named First Look Media, a “hybrid” that melds for-profit and nonprofit operations: there will also be a for-profit technology company that, if it becomes profitable, will subsidize the journalism.

But that’s not what we normally think of when discussing hybrid journalism models. The usual route is for a nonprofit of some kind to own a for-profit news organization. The example most often cited (including by Rosen) is the Tampa Bay Times, which is owned by the Poynter Institute, a journalism research and training organization.

The difference matters, because a nonprofit news organization is prohibited from endorsing political candidates and engaging in other activities that might be deemed partisan. By contrast, a for-profit enjoys the full protection of the First Amendment, even if it’s owned by a nonprofit.

Not that a nonprofit can’t do great journalism — nonprofits ranging from Mother Jones to the New Haven Independent have proved that. But it will be interesting to see how First Look and its high-profile contributors, including Glenn Greenwald and Laura Poitras, negotiate the tricky nonprofit landscape.

Photo via Wikipedia.