The Business Of Stuff You Read Online (Update)

There are dots that people just don’t seem to connect anymore. And there are beliefs so deeply embedded that people just can’t see beyond them. Neither of these things stopped billionaire Joe Ricketts from shuttering DNAinfo and the Gothamist a week after they went union, and people are furious.

A week ago, reporters and editors in the combined newsroom of DNAinfo and Gothamist, two of New York City’s leading digital purveyors of local news, celebrated victory in their vote to join a union.

On Thursday, they lost their jobs, as Joe Ricketts, the billionaire founder of TD Ameritrade who owned the sites, shut them down.

The law entitles employees to unionize. It also allows the owner to close the business. Ricketts explains why.

But DNAinfo is, at the end of the day, a business, and businesses need to be economically successful if they are to endure. And while we made important progress toward building DNAinfo into a successful business, in the end, that progress hasn’t been sufficient to support the tremendous effort and expense needed to produce the type of journalism on which the company was founded.

This infuriated many writers, as it was yet another nail in the coffin of journalism and media. The New York Times, somewhat disingenuously, named a few of the recent casualties.

In New York City, the nation’s biggest media market, established organizations such as The Village Voice, The Wall Street Journal and The Daily News have slashed staff or withdrawn from street-level reporting. The Voice stopped publishing its print edition in September.

The Times has also gone through a few rounds of layoffs and cuts, Huffington Post as well. So too my baby, Fault Lines. To some extent, these may be labors of love, but they must also be financially sustainable. Sure, SJ isn’t a business, and many of you have graciously contributed to the cost, but it remains a “tremendous effort and expense” that I carry. Writing posts is the least of it (and the fun and cathartic part).

Are people angry about the loss of two online media outlets that did great work, served a purpose, fulfilled a need? Nah. There was some of that, of course, by people who appreciated what these two sources put out. But there are three dots here that mattered, that the employees unionized, that Ricketts closed up shop, and that Ricketts is a billionaire.

Do employees, and particularly online writers who have long been treated poorly, deserve to be paid for their efforts, and paid fairly if not well? Sure. Everyone deserves, in the most general sense of the word, to be paid for their work. Though it’s not as if they didn’t take the gig knowing what they were getting into. Just because you want to do something, and even if you’re really good at it, you are not entitled to a job that pays you to do it.

So the great writers at DNAinfo and Gothamist voted to be represented by the Writers Guild as their union to improve their salaries, benefits and working conditions? One of the dirty little secrets of writers on the internets is that it pays poorly, for the most part. Really poorly, which is why many of the pundits you read on serious soapboxes are 23-year-old humanities majors who are utterly clueless about the subject matter. The pay isn’t enough for a grown-up with a family to live. So it’s completely understandable that they would join together as a collective-bargaining unit to improve their lot.

But the other side of that coin is that the business with which they seek to negotiate needs to be sufficiently profitable, or at least financially viable, to afford their demands. And this is a two-step issue, as it’s not just the cost, but the effort required to handle negotiations, grievances and the potential labor disputes that arise. There is a cost in money. There is a cost in aggravation. If the business is doing well enough, the costs are worth it. If not, then, not.

And finally, there is that latent-socialist sensibility that rich guys like Ricketts are obliged to run the businesses they start and own as charities for the benefit of others. Could he afford to run these two media outlets at a loss, or at least without a profit? Sure. He’s got the loot. But it’s his loot, not the employees’.

If Ricketts wanted to run DNAinfo and Gothamist as charities for the benefit of the writers, who unionized to negotiate how the charity would be run, he could have. He chose not to. It was his choice. These outlets weren’t started as charities, but businesses. They didn’t quite fail, but weren’t sufficiently successful to make their continued operation viable. That’s the choice an owner gets to make.

The news took the newsroom by surprise. David Colon, a reporter for Gothamist, said that a lawyer for DNAinfo was present when the staff was told, but that he “didn’t really” take questions.

“Very classy,” Mr. Colon said. “I yelled a lot and somebody told me to stop. Now we’re all trying to figure out what to do.”

There are now 115 writers out of work, though they received a very generous package of four months’ pay. It’s sad that those writers are now unemployed. There is no doubt they worked hard and deserved better than they got. But if the business didn’t prove to be profitable to continue, then the only rational decision was to close it down. Even rich guys are allowed to make rational choices. Even when it means the livelihood of people who are enjoying the largesse of the business they created. That’s how business works, even if this concept seems so elusive these days that few connect the dots of profitability, sustainability and your having a place to go every morning where they give you a paycheck.

It pained me greatly to leave Fault Lines. I thought it had the stuff to survive, but I was wrong. Many of you have contributed generously to SJ, but many of you read it for free as an entitlement. Eventually, financial realities will hit home for all online media. The inability to connect the dots may make you angry and confused, but it will not change the result.

If you don’t like it, then start your own online media outlet, blog, whatever, and write your heart out, or get other people to write for you. Dig into your pocket to fund it. Spend your days fixing stupid problems and dealing with the strife that humans constantly create. Then sit back and listen to random people you neither know nor love bitch and gripe constantly about crazy stuff which they enjoy for free. When it’s gone, you can take comfort in knowing that it’s all Joe Ricketts’ fault. And mine.

Update: In an op-ed, entitled “Billionaire destroys newsroom out of spite,” Hamilton Nolan attacks Ricketts for his wealth and his politics, his motives and his actions.

The union movement in media is incredibly important beyond what it means to hundreds of employees at more than a dozen sites. Digital media workers have unionized because they understand how they are being exploited at work, and how to fix it. The visibility of their union campaigns can serve as an example to workers in other job sectors, where organized labor has grown nearly invisible, to the detriment of all.

All of this may be true, but if an owner wishes not to deal with unions, he has one legal option: to close the business. Employees shouldn’t be exploited, Now, they are not. Instead, they are unemployed.

28 comments on “The Business Of Stuff You Read Online (Update)

  1. B. McLeod

    Anyone bothered by Ricketts should just take a Vitamin D supplement. I’ve heard that is very helpful.

  2. Richard Kopf

    SHG,

    Titans of industry like yourself will never accept that the workers of the world will soon unite and then stand the picket line warming ourselves by burning trash cans despite your goons trying to bash us into submission. As a former member of the Teamsters, UAW, and Brotherhood of Railway Clerks, I am literally shaking after reading your paean to realism and economics. On the contrary, I stand in solidarity with the Writers Guild. You are obligated to pay us more and more until you go broke!

    I, therefore, I am withholding my next post until I see at least one of the vaunted bacon doughnuts that you selfishly horde in Casa Del Greenfield. So there!

    All the best.

    RGK

  3. Pedantic Grammar Police

    Of course it’s all your fault. It always is.

    It’s all good and well to moan and groan about money, but the reality is that bloggers blog because they want to. They do it for the thrill that they get when someone out there on the internet reads what they wrote and cares enough about it to make a comment. If it is a good comment, that’s even better, but even a shitty one is a thrill at first. I suppose you build up a tolerance, like any other addiction, and eventually you only get off on the very best comments.

    The problem with these damn billionaires is that they only care about money. They don’t get a thrill from anything else. That, I suppose, is why they are billionaires. It’s tempting to want to hate the nasty billionaire for putting those poor people out of work, but as you say, he put them into it too. It’s his money to play with. The modern billionaire is a successful player in a shitty game.

    1. SHG Post author

      Is that why I do it? Who knew? And is that why billionaires do it? Who knew? Never having been a billionaire, I wouldn’t know what those damn billionaires only care about, so I’ll have to take your word for it.

      1. B. McLeod

        Some of us are Scots, obviously. No reflection on the writing here, which is better than a great many other sites I have seen.

  4. KP

    I’m sure he could afford to subsidize it, but he realised that a unionised workforce would move under the control of the usual bunch of Socialists that gain power in unions. What sort of a self-made billionaire doesn’t want control of his business?
    In the 1970s Sir Robert Kerridge bought a hydrofoil ferry to use around the islands in the Hauraki Gulf. The all-powerful shipping union insisted on being in control and he refused. The argument raged over a few years before he sold it, never having been used a as ferry.

    1. SHG Post author

      There’s a strong chance that dealing with a union was the straw that broke the camels back in an otherwise marginal business.

      1. B. McLeod

        In the modern age, people in this country think money comes from a magic well somewhere. So, every business should have to pay all its workers at least $15/hour, even if the business is not sustainable on that basis. If the business won’t agree, ask the state or local government to force it. This is a close analog of the governmental model that posits government can provide every cradle-to-grave service, while collecting no taxes. It is a close analog of the social model that posits everybody should be entitled to have at least a nice car, food, medical care, a college education and a house in the suburbs.

        In the old days, we would throw a penny in a wishing well, but not really expect much. Now, people want 100% entitlement, and they won’t even throw the penny.

            1. B. McLeod

              Well, it isn’t like that’s in the NEVER basket (with such things as ABA dues). Maybe I’ll bring something by when I’m in NYC again. Of course, that doesn’t happen often, as I have to disarm to travel there. Next time might be Aprilish, 2019.

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