My May, 2011 Missoulian InBusinessMonthly column
It seems like all things come down to money, and there is currently a kerfluffle that may or may not change the quality and economics of the world of online writing and journalism. It’s generated talk and recrimination and a huge lawsuit worth hundreds of millions of dollars.
The lawsuit was brought by a writer who worked for free for a website – he was one of many writers for the site – and helped it grow and get to the point of drawing a billion page views a month and becoming worth hundreds of millions of dollars.
The site and company in question is the Huffington Post (commonly known as HuffPo, huffingtonpost.com). And HuffPo recently sold to America Online (AOL) for $315 million in order to expand AOL’s online journalistic reach.
There’s a lot of hyperbole on all sides of the story and the lawsuit. And while the big picture is clear (what is the value of writing and journalism?), what the case may or may not determine is up for grabs.
The press release from the plaintiff’s law firm quotes the lead plaintiff, Jonathan Tasini: “Arianna Huffington is pursuing the Wal-Martization of creative content and a Third World class of creative people. … Actually, that is unfair to Wal-Mart because at least Wal-Mart pays its workers something for the value those workers create. In Huffington’s business model, economic gain is only reserved for her.”
And Arianna Huffington responded at huffingtonpost.com this way: “The suit touches on so many important issues about the current state of the media. … First, let’s look at the merits of the case: There are none.”
Huffington says all those writers and bloggers were contributing to HuffPo as volunteers, on their own time and not under assignment. They were free to come and go as they wished, and got the benefits of exposure for their work on a national scale.
I can’t get into the legal arguments, but the big picture is clear: What is writing and journalism on the Web worth?
Huffington seems to make that clear when writing in her defense: “The key point that the lawsuit completely ignores (or perhaps fails to understand) is how new media, new technologies, and the linked economy have changed the game, enabling millions of people to shift their focus from passive observation to active participation – from couch potato to self-expression.” http://www.huffingtonpost.com/arianna-huffington/huffington-post-lawsuit_b_848942.html
That’s true. HuffPo and many other sites encourage communication and discussion and give writers and journalists exposure they probably couldn’t get on their own.
But the “new media” is also worth hundreds of millions of dollars, and some know that better than others, like Huffington, who sold HuffPo for $315 million. (What made HuffPo worth that much? Ad revenue brought in by readers clicking on ads on the website.)
What’s worse than the money and the lawsuit is what the AOL and HuffPo buyout promotes, Tim Rutten wrote in an opinion piece in the Los Angeles Times: http://articles.latimes.com/2011/feb/09/opinion/la-oe-rutten-column-huffington-aol-20110209
“Whatever the ultimate impact of AOL’s $315 million acquisition of the Huffington Post on the new-media landscape, it’s already clear that the merger will push more journalists more deeply into the tragically expanding low-wage sector of our increasingly brutal economy.”
Rutten also wrote: “To grasp the Huffington Post’s business model, picture a galley rowed by slaves and commanded by pirates.” That line garnered lots of blowback for his questionable metaphor.
Can the issues of the value of online creative content and journalism be reduced to that kind of relationship?
A 5/01/11 update: AOL, Huffington Post Seek Another 8,000 Free Bloggers – Wired.com