The New Republic’s Ellie Quinlan Houghtaling scalds newspaper owners for the mass layoffs that are making 2024 look like “one of the worst years on record for journalism.”
The body count of laid-off journalists for January alone totals 800 in a year that will see one of the most important elections in generations. A particularly galling action was the Washington Post’s decision last fall to ax 240 jobs – or nearly 10% of its total headcount – through buyouts. When billionaire Jeff Bezos bought the Post in 2013, he said he was doing so to preserve high-quality journalism, but the paper’s declining fortunes – it reportedly was on track to lose $100 million in 2023 – evidently prompted a change of attitude by the famously patient executive.
While there’s no question that $100 million is a lot of money, it’s only .05% of Bezos’ $192 billion net worth. Houghtaling sees the penny-pinching as typical of the rash decisions billionaires and hedge funds have made in media investments.
She cites the example of Sports Illustrated, the venerable magazine that once boasted more than 3 million subscribers, which was all but shut down in January. Thanks to a series of transactions, the magazine had come to be owned by The Arena Group, which is “primarily a licensing company that acquires the rights to celebrity brands,” according to The New York Times.
Then there’s The Messenger, an online publication that promised to restore the value of high-quality journalism when it launched last year. Owner Jimmy Finkelstein abruptly shuttered the operation last month after reportedly burning through $50 million, including spending $8 million on office and a $900,000 salary for its editor-in-chief.
Owner Jimmy Finkelstein cited “economic headwinds” as the reason for the collapse, but critics have said its business model, which was heavy on aggregation and set an unreasonable goal of 100 million unique monthly visitors, never made sense. Defector’s Chris Thompson charged that the company dumped about one-quarter of its startup capital on luxuries and spent lavishly on office space in expensive locations like New York City and West Palm Beach. Upon closing, it shut down its website, leaving roughly 300 journalists without clips to show for their labor.
Houghtaling takes aim at other clueless billionaires, including Patrick Soon-Shiong for his purchase of the Los Angeles Times and The San Diego Union-Tribune without any apparent plan to reverse their declines. Soon-Shiong later sold the Union-Tribune to hedge fund Alden Global Capital, “which so ruthlessly squeezes local papers for every drop of cash that it has been referred to as the ‘Grim Reaper.’”
She also rips right-wing media magnate David Smith, chairman of Sinclair Broadcast Group, for purchasing The Baltimore Sun and then holding an insulting two-hour meeting with the paper’s staff during which he spoke mainly about profits and told journalists to “go make me some money.”
Writing on Press Watch, Dan Froomkin asks plainly, if less elegantly, “Why are billionaire newspaper owners so damn cheap?” His argument amounts to wondering why people with more money than they can ever spend become penurious when it comes to the news business. He suggests that nonprofits and foundations would make better owners and can easily afford to purchase even the largest newspapers at their current tiny valuations.
