Micah Loewinger: 2023 has already been the worst year for media jobs yet.

News clip: BuzzFeed will lay off about 15% of its staff and it's going to completely shut down the news unit itself.

News clip: Vice Media was once one of the hottest names in new media. They just filed for bankruptcy protection.

Micah Loewinger: From WNYC in New York, this is On the Media. I'm Micah Loewinger. Meanwhile, the New York Times won the tumultuous era of digital media, in part by emulating the success of Silicon Valley.

Ben Smith: They're trying to be a kind of a destination for people's whole lives, and if they can get there, then they have all sorts of other things they can sell.

Micah Loewinger: Plus a handful of new publications are tearing down the old culture of the news biz.

Danny Funt: When you aren't determined to grow at a rapid pace and you aren't beholden to those corporate bosses, running a media company really isn't that complicated.

Micah Loewinger: It's all coming up after this.

Micah Loewinger: From WNYC in New York, this is On the Media. I'm Micah Loewinger.

Brooke Gladstone: And I'm Brooke Gladstone. It's a bad time for the news business. Actually, it is usually, but this is one of the worst. This year, a record number of job cuts so far, over 19,000 of them, according to one study. Just last week, G/O Media declared the shuttering of Jezebel.

News clip: Female-focused website Jezebel is shutting down after 16 years.

Brooke Gladstone: Earlier this year, there were other seismic shifts in the digital media world.

News clip: Internet media darling BuzzFeed is shuttering its news division.

News clip: Vice Media was once one of the hottest names in new media. They just filed for bankruptcy protection.

News clip: It feels like the end of an era.

Brooke Gladstone: But it wasn't always so dire. BuzzFeed News was launched by Jonah Peretti amid the seemingly endless promise of digital news. In 2011, Peretti went to work on BuzzFeed full-time and brought in Ben Smith to set up a newsroom to move BuzzFeed's content, best known for quizzes and listicles, up market. Now, Smith is the editor-in-chief and co-founder of the new website, Semafor, and author of the book Traffic: Genius, Rivalry, and Delusion in the Billion-Dollar Race to Go Viral. When I spoke to him earlier this year, he explained to me that when Peretti launched BuzzFeed, he thought the site would be the next MTV, the next Viacom.

Ben Smith: We believed, and you can argue now about whether this was delusional or whether it just didn't turn out that way, that places like Facebook and Twitter would ultimately wind up paying for quality content the way, say, Netflix or Disney pays for quality entertainment.

Brooke Gladstone: What went wrong?

Ben Smith: I mean, what went wrong was they basically never paid a dime. There were moments in which it seemed like it was going that way. There was a year when BuzzFeed News was collecting checks from Facebook, Twitter, and Snap, and I thought, okay, this future is starting to emerge, but there were a few things. One was that the people running the platforms really liked user-generated content, which is free. Another is they really often did not like journalism, really. Actively didn't like it. Felt they'd been covered unfairly, had these utopian ideas about citizen journalism and the wisdom of crowds. They weren't wires laid in the ground. They were social spaces where people gathered that maybe didn't prove as durable as we thought.

Brooke Gladstone: Durable in what sense?

Ben Smith: One issue is that the platforms may turn out to have been things people had fun with in the 2010s, but that we may not be on much longer. In others, the platforms got really freaked out about news. Particularly, when American and global politics got so divisive, so toxic. You're a tech CEO, you're getting hauled in front of Congress because of news content that really isn't where you're making your money anyway, and you start wondering why you were anywhere near it.

Brooke Gladstone: I think there was also an assumption that the social platforms would take on more responsibilities or get better somehow.

Ben Smith: When we brought news to BuzzFeed, it was a moment when the Facebook newsfeed was new and delightful, and the idea that you could get journalism and baby pictures and memes, and it was considered fun and it was very popular. We were providing the whole range, essentially, that people would share on their Facebook feed. I think as the news itself changed and as this new very confrontational, right-wing populism got very good at driving engagement on Facebook, a lot of consumers started finding that less fun.

The platforms started to deal with the social and political consequences of amplifying this very divisive political debate. That was something that we had not particularly seen coming and that really complicated our whole project.

Brooke Gladstone: There was a day in 2015, you call it the last good day on the internet.

Ben Smith: That morning some llamas had got loose in Arizona and everybody spent the whole morning on social media watching these hapless sheriffs chase llamas around. Then that afternoon, a woman who'd gone to a wedding, and I believe it was Scotland, came back with this out-of-focus photo of this dress and was arguing about it with her mom and her friends, messaged it to the woman running BuzzFeed's Tumblr and said, can BuzzFeed help us resolve this dispute?

It very quickly just became this delightful moment of global culture in a way that, again, I thought at the time, oh, ah, this is this lovely new thing. Like truly global instant culture that is fundamentally basically quite sweet, divisive in a literal sense. A third of people, I believe, thought it was white and gold and the rest thought it was blue and black, but fundamentally sweet and harmless.

Brooke Gladstone: Then things changed.

Ben Smith: Things changed and I think things didn't just change on the internet. I think all over the world you had this surge of real anger about migration, about trade, about globalization, and a new kind of right-wing populism embodied in the US by Donald Trump. Facebook, and Twitter and these other platforms, they measured their success by, and the success of a piece of content, say a tweet by how many people were interacting with it. Basically, I post a racist meme, you comment, you're a racist. I then comment, no, you're a racist. The machine says, wow, look at this incredible engagement. Let's show it to every single person in North America right now. It really favored incredibly divisive content.

Brooke Gladstone: You said that Facebook made a decision it later regretted to not just show you what your friends were sharing, but things like what your friends were sharing just to keep people stuck to the platform.

Ben Smith: Then Facebook was not full of people who were trying to elect the next president. It was full of people who could see that you were spending 23 minutes a day on Facebook and were trying to get you to spend 24 minutes and were tinkering with stuff that would keep you there a little longer. Had the reasonable view that, oh, like a good way to predict what you're going to like is to look at what everybody else likes and we'll show you that. It's no longer really a social network. It's a content network that's taking signals from one person and learning and showing it to another.

It was an attempt to fix a system in which people had just been idly sharing stories that Hillary Clinton had been replaced by a body double without reading them. They said, no, we need to make sure that this is meaningful engagement. Let's favor comments in particular, screaming matches about racist memes.

Brooke Gladstone: You wrote that while you and Jonah "thought that you were inventing digital media", the figures who would create the new American far right were flickering just around the edges of that picture from the start. By which you mean Andrew Breitbart was working alongside Jonah to found the Huffington Post. Chris Poole, the founder of 4Chan, worked out of BuzzFeed's offices, a BuzzFeed video star begged Alaska storm the Capitol on January 6th. The editor for your book mused that maybe you were Rosencrantz and Guildenstern in their tragedy.

Ben Smith: I think that was, to me, the most surprising thing about going back and reporting all this out was seeing in that early internet scene in the arts, the people who I was writing about, Jonah, Nick, and others, just -- it was so presumptively a progressive world. To some degree explicitly for a blog like Jezebel or for a site like Huffington Post. The goal was the election of Barack Obama and they made no bones about it.

Facebook, in particular, was seen as obviously aligned with Barack Obama. As late as 2011, he went and visited Facebook and he didn't have to say he was visiting because it was a democratic-leaning company. It was like visiting Madison, Wisconsin, or something. You're visiting a place full of college students because that's who votes for Democrats.

Yet, it also is totally clear that the real apogee of that, this whole digital media world is the election of Donald Trump in 2016. Then when I went back and tried to look at the whole picture, the folks who were very deeply involved in Trump's election, his style of media were really there all along, were looking at these tools and were in some ways better suited and more willing to take them to their logical conclusion than we were.

Brooke Gladstone: How do you feel about BuzzFeed having trained some of these people?

Ben Smith: I mean, I find it pretty disturbing. We clearly, I think, we misunderstood as I feel like I misunderstood the situation and the kind of politics that was emerging.

Brooke Gladstone: You told CNN that the closure of BuzzFeed News made it really clear that the relationship between news publishers and social media is pretty much over. The week after BuzzFeed announced it was shutting down news, Jonah Peretti wrote on the site that, "We've benefited from the previous era of the internet having struggled during this transitional period

and are poised to benefit again, as this next era of the Internet takes shape. What's the next era?

Ben Smith: I think the late social media world gives you this illusion of a debate and of seeing all sorts of perspectives, but really what it's doing is, it's a machine for elevating the dumbest version of the argument you hate, and showing it too constantly and convincing you, the people who you disagree with are just utter morons all the time, but I do think we're moving away from that particular world into a bunch of different smaller spaces.

Brooke Gladstone: Why do you think that?

Ben Smith: I thought it was a really interesting statistic that was stuck with me the other day that we published in Semafor, that if you ask people if they have a favorite podcast, not everybody does. The likeliest person to be their favorite podcaster, no surprise is Joe Rogan, but what's interesting is, only 5% of people say it's him. That's the biggest share of the market is somebody who has 5% of the market. It's a very unusual long tail of a market where the biggest share is 5%, and many, many people are succeeding with fractional percentages. It's a very wide open unconsolidated place where people are looking for smaller, more intimate conversations with people who specific take on the world they relate to. It's also just people are sick of the last thing and ready for something new.

Brooke Gladstone: What are some of the lessons from the era that we might say is ending that you're hoping the news industry carries forth into the next one?

Ben Smith: I think the biggest lesson which isn't solely about news is just the extent to which every technology, every technique, every form, can be used by people with totally different motives for different reasons, and that these surges of utopianism, or I suppose doomsaying about shifts in technology, these things are morally neutral. I think we were incredibly utopian about the promise of digital media, without seeing that it could be used in all sorts of different directions.

The other one for me is that I don't think news is a good business for venture capitalists to invest in. There was a pressure on us to grow really fast, to grow explosively, to build a business that could return many, many times its investment very fast. News can be a good business if you do a really good job and you're very careful about how you run it and can really provide good returns to good investors, but it's not something where venture capitalists should be looking to throw in millions of dollars and see it multiply by a hundred over a period of a couple of years.

Brooke Gladstone: Ben, thank you very much.

Ben Smith: Thank you, Brooke.

Brooke Gladstone: Ben Smith is the editor-in-chief and co-founder of Semafor and author of the book Traffic. This is On the Media. This is On the Media, I'm Brooke Gladstone.

Micah Loewinger: I'm Micah Loewinger.

David Carr: Hi.

Micah Loewinger: This is David Carr from New York Times.

Micah Loewinger: Nice to meet you.

David Carr: Don't keep saying I'm from New York Times, it sucks.

Micah Loewinger: In February 2010, Times Media reporter David Carr and a film crew visited the Brooklyn offices of Vice, then the edgy darling of digital media. Carr's visit to Vice was captured in Page One, a documentary about the struggle of the newspaper of record to adapt to the culture and business of the Internet.

Speaker 12: According to a new poll conducted by the Pew Research Center, more Americans are getting their news from the Internet, rather than a physical newspaper now.

Micah Loewinger: This is a poll conducted that same year 2010.

Speaker 12: It's the first time in the history of the polling that that has happened.

Speaker 13: Because we have to figure out how we can be media faster and more dynamic than everybody out there. We don't want to get hot and die, we want to get hot, get hotter.

Micah Loewinger: The next scene is probably the movie's most referenced. Carr is clacking away on his laptop in a class conference room with the founders of Vice, including Shane Smith, who's describing his Gonzo documentary; The Cannibal Warlords of Liberia.

Shane Smith: I don't know of Liberia, I don't know what's going on. I don't pretend to, I'm just a regular guy. Everyone taking about cannibalism, and the New York Times meanwhile is writing about surfing. I'm sitting there going, "You know what, I'm not going to talk about surfing, I'm talking about cannibalism."

Micah Loewinger: Carr stops him.

David Carr: Before you ever went there, we've had reporters there reporting on genocide after genocide. Just because you put on a fucking safari helmet and look at some poop, doesn't give you the right to insult what we do, so continue, continue.

Micah Loewinger: The scene captured the stubborn pride of the old guard and refusal to compromise journalistic integrity even as they were seemingly facing extinction. Fast forward to today, Vice got hot and died, bankrupt as of May, and the New York Times is hotter than ever.

Speaker 15: After years of falling numbers, the New York Times is seeing a surge urging in subscribers both print and digital.

Speaker 16: Just an unbelievable turnaround, the New York Times.

Micah Loewinger: When I was reporting this story, it originally aired back in July, I wanted to understand how the Times became a stable profitable powerhouse of the Internet at a time when most other outlets are struggling to survive. What I found is that the Times became profitable in part by transforming itself into a tech company.

Ben Smith: The Times really had been the great winner of this era that began with people wondering if the New York Times could even survive.

Micah Loewinger: Ben Smith again, he's the author of Traffic. He also spent two years in David Carr's old job as New York Times media columnist.

Ben Smith: There's a sort of maxim in the tech industry that you should follow fast and there's a strategy of fast following, and the Times really did the opposite. They followed slow, they watched, they waited.

Micah Loewinger: At the beginning of the 2010s, things were looking pretty bleak for the newspaper business. More and more readers were spending their time on social media; Facebook launched in 2004, Twitter in 2006, Google and Facebook had already gamed the ad market. Anyway, online ads were way less profitable than the print ads that had once bankrolled the paper's journalism. In 2011, the Times took a controversial first step into a new subscription business model.

Speaker 17: Executives here plan to walk a fine line to generate subscription revenue from avid readers willing to pay while still retaining casual customers who boost advertising revenue with their clicks.

Speaker 18: The New York Times has a paywall where you have to pay to read the New York Times online. I predict that it will fail within a year.

Micah Loewinger: The critics, and there were a lot of them, were wrong. According to Ben Smith, the company had timed it perfectly.

Ben Smith: They had to wait for Spotify and for Netflix to train people to pay for media, and then they launched this very painstaking effort to change their own internal culture to adapt belatedly to the Internet. The guy who is now the publisher, A.G. Sulzberger, realized that to move the place required a ritual and the Times and rituals to do the reporting. He assembled a bunch of people who are well regarded internally as journalists, and reported out the Times's struggles with the Internet, what they could do better.

Micah Loewinger: In 2014, the team produced a crisp 96-page document known as the Innovation Report. It called for a more urgent approach to social media, more data collection, and a rethinking of the Times as a truly digital-first new shop.

Ben Smith: The substance, therefore, it was pretty banal, all these people on the Internet reading stuff, you might want to write for them. I think people who thought it was banal underestimated the extent to which inside this institution, it was like a papal encyclical or something, it was a very important signal.

Micah Loewinger: Over the past nine years, the company has seen a bonanza of digital growth. Newyorktimes.com is powered by recommendation algorithms. The site uses machine learning to analyze data from millions of Times' readers and identify likely subscribers. Then there's the wellspring of apps.

News clip: The New York Times is going mobile.

News clip: The New York Times is launching a new app called NYT Now.

News clip: Over the weekend, the New York Times handed out virtual reality goggles to its readers.

News clip: In audio-only app, they own podcast player.

Micah Loewinger: All of its digital experiments repackage the news in novel and engaging ways, but they're also fundamentally an attempt to lure readers away from the biggest sites on the web. Like the rest of the news industry, the Times grew frustrated chasing traffic on Google and Facebook.

Meredith Kopit Levien: We have to win at the game the big tech platforms are playing.

Micah Loewinger: This is the Times CEO Meredith Kopit Levien, speaking at a conference in 2020.

Meredith Kopit Levien: More than 5 million people subscribe to the New York Times, which sounds like a really big number until you consider the fact that as many as 50 million people every week, land on a New York Times story, and most of them are coming there from Google or Facebook or somewhere on the Internet where they're already spending a ton of their time.

Micah Loewinger: In her mission to beat big tech at their own game, Levien has started to draw from their playbook.

Meredith Kopit Levien: The question is, will we have quality original independent journalism available to the masses in 10 years?

Micah Loewinger: Here she is speaking with CBS in 2018.

Meredith Kopit Levien: I think the answer is yes, but it requires that news organizations make digital experiences that are as addictive and unrivaled as the journalism itself.

Micah Loewinger: This word "addictive", one she and other Times leaders use regularly in interviews and earnings calls is a term with roots in Silicon Valley. Of course, it's very rare to

become addicted in the medical sense, though many of us have developed enduring habits around social media and screen time in general, which as former Facebook president Sean Parker told Axios in 2017 was the goal.

Sean Parker: The thought process that went into building these applications, Facebook being the first of them, to really understand it, that thought process was all about how do we consume as much of your time and conscious attention as possible?

Kathy Zong: How do we actually get people to engage with the Times and build a habit in which we can expect people to just come regularly regardless of whether there's like big news or not.

Micah Loewinger: Kathy Zong is a senior manager of newsroom and product analytics at the Times. She told me the company has said it's building a lifestyle brand. As one Times executive recently put it to Vanity Fair, "What does it look like for the Times to have embedded itself deeply into every single moment? How do we get every second of your day?"

Kathy Zong: The leaders of this company really want to create these touch points that people are developing a habit with the Times. In the morning waking up, checking your notifications, reading the app.

Micah Loewinger: As you're getting ready or commuting to work, you throw on the daily.

Kathy Zong: Then maybe play some games during your lunch break.

News clip: Wordle, the New York Times purchased the game for a seven-figure price tag.

Speaker 27: I'm more of a spelling bee guy myself.

Kathy Zong: You go home before you go to the grocery store, you check out the cooking app and you figure out a recipe and you then decide what to buy, and top it off with some podcast or something.

Micah Loewinger: Like say a new show from serial productions which the Times bought in 2020.

Kathy Zong: You're watching one of our documentaries that we put on Hulu or FX.

Ben Smith: I think in your narrative the one thing you have wrong is entertainment.

Micah Loewinger: Ben Smith.

Ben Smith: The FX show is kind of dead. The Times I think wisely is basically staying out of the television business, and will permit you to flip over to Netflix at night once you've read their summary of what you should watch on Netflix. They're trying to be a destination for people's whole lives in a certain way, and if they can get there, then they have all sorts of other things they can sell.

Micah Loewinger: Am I just naive for finding that slightly icky for a newspaper, or is that just the attention economy and is it just like, wake up, this is the game, let's play by the rules?

Ben Smith: I mean, I think that seems like a reasonable goal for a subscriber business trying to serve its subscribers and I'm not sure, do you find it less icky to toggle between Google and Facebook and sift through the chaos of information? I do think that what you're really suggesting is how many people want to live in a monoculture. I think the thing is some do. I think there are a lot of people who found the last decade of a social media takeover really discomforting, and like the idea of connecting with a single trusted brand and the times will just clearly be the biggest of those.

Micah Loewinger: The company's biggest growth spurt came from the so-called Trump Bump when readers flock to the Times and other outlets for the daily drip of drama and outrage.

Ben Smith: When that tide receded, what you saw was the Washington Post and many other publications were back to being struggling newspapers trying to figure out the digital transition, and the New York Times was this full surface media company that when if you didn't want to read about Donald Trump, you could get recipes, or games, or podcasts, or sports.

Micah Loewinger: Which the time says is a digital recreation of the traditional newspaper bundle.

Nilay Patel: It's remarkable how much you sound more like a text CEO than a media CEO. Maybe that's because of the structure and--

Micah Loewinger: This is Nilay Patel, editor of The Verge interviewing CEO Meredith Kopit Levien earlier this year on the Decoder Podcast.

Meredith Kopit Levien: I have the privilege of being CEO of a journalism company. We are a tech-enabled journalism company. We have extraordinary digital product development and engineering and data talent, but make no mistake, we're a journalism company.

Micah Loewinger: Obviously The Times has won the most Pulitzer Prizes for its journalism and continues to drive the daily news cycle. These labels may be squishy but they're not mutually exclusive.

Nilay Patel: Is the Times a technology company? One answer is, obviously, yes.

Micah Loewinger: Clay Shirky is vice provost at New York University and a scholar focusing on media and the internet.

Clay Shirky: The other answer is, what is a tech company anymore anyway?

Micah Loewinger: It's true that tech company is a vague marketing term. It often obscures how most of these companies actually make their money. Google is an advertising company. WeWork is a real estate company. Uber is a transportation company, but would prefer to pay its drivers as contractors who just use its software. That term tech company still connotes an era of Silicon Valley's financial and ideological dominance. An era that Clay Shirky says may be coming to an end.

Clay Shirky: At a time when Facebook and Amazon and Google are laying people off by the thousands, the sense we had of what it meant to be a tech company for the last 20 years turns out to have been on some level a zero interest rate phenomenon. These companies simply had access to a capital that other companies didn't. That what we're really going through is this big shift in even our sense of what it means to be a tech company.

My guess is that we're going to start to see is that media companies and banks especially who have had a really hard time hiring competent engaged technologists in the last 20 years, because of this competition with Facebook and Google and Amazon and so on, are going to find it easier to actually bring people on board who know how to build things for the internet. I think the Times is an early example of that category. It's a really tech savvy media company.

Micah Loewinger: This blending of Silicon Valley's strategies, ideals, and workers with those of a news organization has triggered a kind of identity crisis for some within the New York Times. Some employees told me that their leadership's resistance to the tech company label mirrors an active labor battle.

Kathy Zong: The reason that the company tries to like shy away from saying it's a tech company specifically in our negotiations in the tech guild is that we do not get paid close to a lot of what tech companies pay their workers.

Micah Loewinger: Kathy Zong again, she's the unit chair of the New York Times Tech Guild, which is the country's largest tech union with collective bargaining rights. The Tech Guild includes positions like data scientists, software engineers, and product managers. Since they won their election last year, the Times has not agreed to a first contract.

Kathy Zong: When it suits management, they will say to us specifically on the tech side, well, our competitors are the Washington Post, or CNN, or the Wall Street Journal. On the newsroom side, there was a presentation in which they compare the company more to other kinds of subscription services.

Stacy Cowley: It did have companies on it like Netflix and Spotify, and we were looking at that and going, "Huh, that's pretty interesting to see the Times positioning itself in this way."

Micah Loewinger: This is Stacy Cowley, a finance reporter at the Times and Secretary of the Times Guild, the union on the news side. She and her shop just won a hard fought battle for raises.

Stacy Cowley: Under our previous contract, the least amount of money someone could be paid was around $38,000.

Micah Loewinger: There were writers who were making 38k.

Stacy Cowley: Largely non-writer positions. Our security guards for example, our sales coordinators, our news assistants. It was always really frustrating during the negotiations when we would say, "Look, you can spend $400 million on stock buybacks." I mean, our CEO last year made in the ballpark of $7 million. That's not a number you would typically see for the CEO of something that's just a newspaper. She's starting to look like she's paid comparably to tech industry executives, and you're really turning around and telling us you can't afford a million dollars a year for a $65,000 salary floor, really? We're not stupid. We're New York Times reporters, come on.

Micah Loewinger: Two and a half years later you succeeded on that front.

Stacy Cowley: We did win our $65,000 salary floor. It was a very different company financially than it was 10 years ago. I was walking into the office a couple months ago and as I was walking in, there was a pair of teenagers taking a photo with their phones of the Times, awning outside the building and one of them said to the other, "That's the company that bought Wordle. I'm like, "Oh my goodness. This is a wild new world I live in now." As someone who wants to see the New York Times be healthy and thrive, yes, I support the concept that this is no longer a newspaper.

Micah Loewinger: You're just happy to do the journalism.

Stacy Cowley: I'd like to focus on that part.

Micah Loewinger: There's a lot to celebrate in the fact that the New York Times has figured out how to fund high quality journalism, but could beating big tech at its own game mean choking out the rest of the media?

Ben Smith: I think the Times benefits from the kind of digital scale that giant tech companies benefit from. It turned out that one search engine would win, that one social network in Facebook would win at least for a time.

Micah Loewinger: Ben Smith.

Ben Smith: My first column for the New York Times was about the monopoly, the Incredibles, and sometimes as you say scary success of the New York Times.

Micah Loewinger: In your piece, you quote an array of media muckety mucks who all said a version of, the Times is going up while the rest of us go down and eventually they'll be the last one standing. I mean, that's a pretty dire future. Do you believe that we really are on that course?

Ben Smith: I think when it came to national news where you had had a hundred newspapers around the country each doing its own version, the Times got into this virtuous cycle where they were getting more subscribers, being able to pay people more. Hiring more journalists, doing more news, breaking more news as

everybody else suffered, and then as a consumer you look around and one is vastly superior to the others.

When I last looked at this, The Times had more subscribers than basically everybody else combined in its category. That includes The Washington Post, that includes the Los Angeles Times, that includes-- just keep going down the list.

Micah Loewinger: On this show over the last two decades, we've done scores of interviews on the death of local news and the failed economics of the newspaper biz. We even wrote a jingle to herald those segments because we did them so often.

[music]

Micah Loewinger: Has The New York Times in its raging hotter than hot success finally solved the riddle?

Clay Shirky: If Sulzberger were to pick up and move to the LA Times he would not under any circumstances be able to recreate what he'd done for the Times.

Micah Loewinger: Clay Shirky.

Clay Shirky: It's like trying to copy Harvard or trying to copy Google. There are just some fields where the company in the lead position doesn't actually have a lot of lessons even for its own competitors.

Brooke Gladstone: Coming up, so The New York Times is in a league of its own. That doesn't mean there can't be other leagues.

Micah Loewinger: What is the score? Anyone got a score?

Speaker 31: 5-2?

Micah Loewinger: 5-2, Hell Gate.

Brooke Gladstone: This is On the Media.

Micah Loewinger: This is On the Media, I'm Micah Loewinger.

Brooke Gladstone: I'm Brooke Gladstone. Wall Street loves the New York Times leadership, which has paid out hundreds of millions of dollars to investors in the past few years. Meanwhile, a growing cohort of new outlets around the US is trying to wrestle journalism away from big capital, experimenting with a cooperative business model in which journalists co-own and co-run their outlets. There's Aftermath, a gaming site, 404 Media for tech news, Racket in Minneapolis. Maximum Fun, a podcast company in Los Angeles, and in New York there's Defector a sports and culture website, and the local news site Hell Gate. Michael went to a softball game between the NYC rivals and friends and reported this piece about them that we aired in July.

Micah Loewinger: Hell Gate was winning when I arrived at McCarren Park, where I found a group of 20-or-so writers, editors, and ringers from other newsrooms. Frank, and White Claws, and Mexican beers, stomping around in the mud pretending they didn't take the game seriously.

Jasper Wang: At the moment it is the bottom of the third.

Micah Loewinger: This is Jasper Wang Defector co-owner and VP of revenue and operations.

Jasper Wang: I feel good that we're going to make it a game by the end of the 7th.

Micah Loewinger: When I arrived he was cheering on his writers as third base coach.

Jasper Wang: Is the trophy the hearts and minds of people interested in independent media in New York City? I couldn't say.

Micah Loewinger: With just 2,500 paid subscribers to Defectors 40,000 plus, Hell Gate is the underdog in the media survival game and the softball game. Do you feel added pressure that you are the sports-oriented website and that you have more to lose?

Jasper Wang: It truly did not occur to me until you just said it now that they don't really cover sports, so the answer is yes now. In the last 30 seconds, I feel more pressured.

Micah Loewinger: Jasper was on the sidelines of Defector long before it was a publication. Most of its writers came from another site Deadspin, the Gawker Sports blog.

Jasper Wang: I started reading Deadspin the summer of 2007. I was 19 years old and I was immediately hooked.

Micah Loewinger: He was a nerdy teen destined for business school, but he fell in love with the uncompromising morals infusing Deadspin's coverage.

Jasper Wang: A very labor-forward view of sports that ultimately the owners who get to hold the championship trophies first at the end of the season really play just a minimal role in the actual product. Viewing the Battle of Millionaires versus Billionaires as a meaningful reflection of labor politics is something that I don't know that many people would've thought of without the Deadspin editorial team.

Micah Loewinger: Is it fair to say that you experienced something of a political awakening reading Deadspin?

Jasper Wang: Yes. My politics were shaped by the Deadspin editorial voice.

Micah Loewinger: That's a lot of credit to give a blog.

Jasper Wang: It's a lot of credit to give to my now current coworkers who will surely make fun of me for so earnestly crediting them on the record. I already regret a little bit in saying that out loud.

Micah Loewinger: [laughs] Sorry. Then in 2019, Great Hill Partners, a small private equity firm bought Gizmodo, Gawker, and all their properties.

Jasper Wang: Immediately, there were conflicts between editorial leadership at the various websites.

Micah Loewinger: Acting editor-in-chief Barry Petchesky was called in to meet with the new leadership and asked to "stick to sports". In other words, cut out the political analysis that their readers loved.

Jasper Wang: It eventually led to Barry Petchesky getting fired unceremoniously in October 2019 and the rest of the editorial staff quit in solidarity, and within 48 hours they had nobody on staff there. I reached out to the editors and writers who quit that company just to say I'm sorry, and by the way, I'm just a business guy around the city and if you're thinking about starting a new company, I'd be happy to help you however I can. In July of 2020, we formed the company and announced it.

Micah Loewinger: They chose the name Defector, get it? Jasper lent the team $50,000 to get the ball rolling while they reached out to investors.

Jasper Wang: From the beginning of that process, there was already misalignment in what we wanted to do and what investors would want to see. As an example, early-stage investors are used to investing in a company that is owned by just a handful of co-founders. We said, no, we're going to have 20 co-founders. I remember saying I think the path to being a nice little profitable business is immediate. We can see that within 12 months. A person we were pitching said, well, I don't want a nice little business, I want a big business. You hear about the hockey stick growth that venture capital funds want to see and that you got to draw that hockey stick on the chart.

Micah Loewinger: Investors clearly weren't down with their vision, so the writers asked old Deadspin readers to become subscribers $8 to $12 a month to access the community and commentary.

Danny Funt: They launched as a worker-owned company. Everyone had an equal ownership stake.

Micah Loewinger: Danny Funt is a senior editor at The WEEK Magazine. He recently wrote about Defector and other media cooperatives for the Columbia Journalism Review.

Danny Funt: Their salaries were known to everyone on staff. Their base salary is around $70,000 and a lot of decisions are made in a very democratic fashion and they've been by and large a remarkable success.

Micah Loewinger: In what ways would you say Defector and Hell Gate are significantly different from traditional news outlets?

Danny Funt: The biggest one is that they don't have anyone on a publishing or business or corporate side calling shots. The journalists are the ones steering the ship. They view the corporate side of media as just fat that could be trimmed. As the editor-in-chief of Defector told me, when you aren't determined to grow at a rapid pace and you aren't beholden to those corporate bosses running a media company really isn't that complicated.

Micah Loewinger: One narrative I've come across with regard to Defector is it can't be replicated, to those who read Deadspin religiously for years, they really liked this group of people, and those readers left Deadspin and some of them subscribe to Defector. Even though it's a new website, it's a legacy readership. What do you think of this idea that an organization like Hell Gate can't be successful because it is truly new, it's not a reboot of an existing site?

Danny Funt: That was a pivotal question as I reported this story and I heard really divergent answers from people in media. Some said worker-owned media really will only work at the local level, so if you're paying $10 or whatever their monthly cost is, is more tolerable than if it's just like one of a dozen national publications you're paying for. Others said, no, this really only works on a national level because you need to have such a big audience to make it viable, and Defector is certainly an example of that.

Jasper Wang: I think some people on staff do have a little bit of a chip on our shoulders about like, oh, well, Defector was a one-in-a-million thing.

Micah Loewinger: Jasper Wang.

Jasper Wang: The model is not scalable. It doesn't apply to businesses that are triple-digit employees nor does it apply to other small groups of journalists who are trying to start their own thing. I'm just rooting like hell for Hell Gate.

Micah Loewinger: They're rooting for him too.

Speaker 34: Jasper.

Micah Loewinger: Did he just score a home run?

Speaker 34: Yeah. Damn, Jasper's really good. [chuckles]

Micah Loewinger: Back in McCarren Park, the game was tightening.

Jasper Wang: There were a couple of errors in the last inning that allowed Defector to get back in the game.

Christopher Robbins: This could be the rope-a-dope strategy in which they come back and destroy us, so we want to make sure we finish the job here.

Micah Loewinger: This is one of Hell Gate's founders Christopher Robbins.

Christopher Robbins: Chris is up, you're up, top of the order, hit a pop, fly.

Micah Loewinger: Which was fumbled by a Defector fielder and he got on base. Before helping start Hell Gate, Christopher Robbins cut his teeth as an editor and

reporter for the Village Voice and Gothamist, the local news site owned by my employer, New York Public Radio. While he earned a reputation as an excellent journalist, he was laid off multiple times.

Christopher Robbins: At this point, it was 2021. Two other colleagues that I've worked with a lot over the years, Nick Pinto and Max Rivlin-Nadler, we all were underemployed. We all looked at each other and we're like, "How do we start a publication from scratch that embodies this sort of work we want to do and our values and is a fun place to work?" Defector was a huge inspiration and we said, "Let's just work really, really hard for a month, and if it resonates with people, excellent, if not, whatever. We'll always have the one month of Hell Gate." We did it for a month and it resonated and we all wanted to keep doing it.

Micah Loewinger: How did you come up with the name Hell Gate?

Christopher Robbins: We're scanning the cool sounding landmarks in New York City. It's this part of the water on the east side that is historically treacherous and that lots of ships wrecked at. It's also a rail bridge that I believe it's the sturdiest bridge in New York City. We pitched it as it's a sturdy bridge over turbulent water. That is our guiding ethos.

Micah Loewinger: Last spring, Hell Gate launched as a scrappy team of five-worker owners who could churn out stories both fun and trenchant. Among them, Esther Wang, who spent years reporting on social movements for Jezebel and The New Republic. She's one of Hell Gate's primary editors and among many other things, writes a column about urban fishing called Only Fins.

Esther Wang: I'm a blogger, I fully admit it. I love blogging. [laughs]

Micah Loewinger: There are plenty of blogs, but in their first month, Max Rivlin-Nadler, one of the co-founders, proved that Hell Gate's small team could make an impact too.

Max Rivlin-Nadler: It was a classic alternative magazine piece where I dove back into this court case that had been playing out in Queens for a number of years where this young Guyanese immigrant named Prakash Churaman, had essentially spent his teenage years on Rikers Island. He'd been found guilty of felony, murder, and he was actually set up for a retrial last summer before I published.

I dug into the case just having a report on the Queen's criminal justice system for a number of years. I looked into the detectives and sure enough, they had just recently had a huge settlement against them for hiding evidence or withholding exculpatory evidence in a very similar case. I wrote about that and how the city had already paid out a gazillion dollars to people who had been wrongfully imprisoned. Within a month, the charges were dropped against this kid.

Micah Loewinger: Then in May.

Speaker 38: Protests continue to swirl over the choking death of Jordan Neely on an F train last Monday.

Speaker 39: The medical examiner has now ruled that passenger's death a homicide by chokehold.

Christopher Robbins: How could a train full of people just sit passively by and watch as the life was choked out of someone?

Micah Loewinger: Christopher Robbins.

Christopher Robbins: That was the question on so many New Yorkers' minds after that happened.

Micah Loewinger: Hell Gate's Nick Pinto was the first reporter to offer a satisfying answer tracking down several witnesses.

Christopher Robbins: I don't think that anyone else had comprehensive accounts of what happened on that train other than Nick at that time.

Micah Loewinger: Hell Gate regularly advances stories on policing and local government at a time when local journalism is drying up and it needs solutions. Max Rivlin-Nadler thinks his team has found one.

Max Rivlin-Nadler: We're promising really slow, consistent, self-sustaining growth. I believe that the cooperative ownership model can replace these medium-range newsrooms that cities used to be just chock full of.

Micah Loewinger: He's betting readers will fall in love with Hell Gate's irreverent, lyrical editorial voice. Articles like One Weird Trick to Forget About the Housing Crisis and Why Does a Plastic-Wrapped Turkey Sandwich Cost $15 At The Airport? A Seinfeldian premise that turns into a crash course on open records laws.

Max Rivlin-Nadler: I actually do think we've lost a lot of good writing on the internet the past decade or so, and I really appreciate that Hell Gate's mantra is really good writing about stuff that you care about.

Micah Loewinger: The site has been growing 10% month over month, garnering around 200,000 unique visits a month. I visited Hell Gate's temporary office. Max showed me around. It's really just two white folding tables in the middle of an East Village community space called The Earth Church.

Max Rivlin-Nadler: The Earth Church is the current home of Reverend Billy, who is the anti-capitalist Reverend who is a big protest artist and activist.

Micah Loewinger: You wouldn't know it from all the radical artwork, but it's actually a former Chase Bank.

Max Rivlin-Nadler: All of the old bank teller slots are still here along with the bulletproof glass.

Micah Loewinger: Is it a coincidence that he chose an old bank to set up his church?

Max Rivlin-Nadler: It's pretty anti-capitalist of him. [laughs] I don't know. The symbolisms, right? Even for Hell Gate on the ashes of digital media, we grow.

Micah Loewinger: I got a chance to see Hell Gate's cooperative model in action as it's now a seven-person team met to discuss finances and the future of the site.

Okay, so this is a meeting of the growth committee?

Nadia Tykulsker: There's eight scenarios that I'm going to run through.

Micah Loewinger: Nadia Tykulsker is Hell Gate's business manager.

Nadia Tykulsker: The first scenario is the one that we won't do for the health and wellbeing of ourselves. We don't grow. We don't make any more money. We don't get a PEO

Micah Loewinger: For people following at home, what is a PEO?

Nadia Tykulsker: It's health insurance, basically. If we do that, we essentially hit negative balance in our bank account in April and we need to raise about 181K in order to get through the entirety of 2024.

Micah Loewinger: As it stands, everyone at Hell Gate makes $48,000 a year plus a monthly $500 stipend in lieu of real health insurance.

Nadia Tykulsker: The second one is that we don't have a PEO, but we all make 72K and we run out of money in March.

Micah Loewinger: In another scenario, Hell Gate pays part of the health insurance. In another, they decide to rent an office since the Earth Church is looking for a new home later this year. In another, they don't get a raise, but they hire someone new.

Speaker 41: More people means more stories. More stories means more people interacting with Hell Gate. More people interacting with Hell Gate means more subscribers. More subscribers means more money, means more reporters, means everything else.

Nadia Tykulsker: The last scenario is that we get a PEO starting in January. Owners make 60K. We hire another editorial employee in June 2024. We don't have an office space and we make it through 2024 with 360K raised.

Micah Loewinger: When you say "raised money", what do you mean?

Nadia Tykulsker: Our goal is to be subscriber-funded, but we have a runway because we didn't start in the same way that Defector did with tons and tons of subscribers. We've been building our subscription base. It's going to take us a little bit of time until our subscriptions allow us to pay for all of our expenses. Until then, we need to raise money through individual donors, through foundation money.

[laughter]

Max Rivlin-Nadler: Advertising, sponsorships, stuff like that. The entrepreneurial side of things outside of subscriptions.

Micah Loewinger: Great. You can proceed. Sorry.

Nadia Tykulsker: No, thanks for asking.

Nick Pinto: I have so many feelings.

Micah Loewinger: This is writer/editor Nick Pinto weighing in via Zoom.

Nick Pinto: I feel like we're confronting two opposing imperatives for Hell Gate's foundational vision, and one of them is to be lean and mean enough that we can survive, and the other imperative is to treat ourselves like human beings who deserve health insurance and to make a living wage and we're now looking at 300 and some thousand Dollars just to get through the end of next year. I think we should all just really absorb that.

Esther Wang: It's been absorbed. Yes. It's fully absorbed.

[laughter]

Micah Loewinger: "Come on dad, let us get the health insurance."

[laughter]

They've tentatively decided on a very expensive option, a $60,000 salary, health insurance, a new team member, and depending on fundraising and actual office space. In other words, they're playing from behind.

[laughter]

Max Rivlin-Nadler: Let's get our hands in because we're going to have these fucking runs back.

Speaker 43: There we go.

Micah Loewinger: This is Max giving his team a pump-up speech in the Hell Gate dugout. They were down 12 to 9 with one last chance at a comeback.

Max Rivlin-Nadler: All right, on the count of three. One, two, three.

All: Hell Gate.

Max Rivlin-Nadler: All right.

Micah Loewinger: Moments later, Rick Polis, a Hell Gate friend and freelancer stepped up to the plate.

Max Rivlin-Nadler: Yes, baby. Yes, baby. Go Rick. Go Rick.

Micah Loewinger: It was a home run, but the rally stopped there. Defector picked off the remaining batters and won 12 to 10. "A Heartbreaking Loss," reads Hell Gate's own write-up of the game. Hell Gate must solemnly report a bitter truth. Defector writers are good at sports or at least better than us, and the two teams lined up, said good game like you do in Little League, and they walked down the block together for beers and burritos.

[music]

Move fast and break things. Disruption, hockey stick growth, huge payouts for investors. These were mantras of the tech boom and digital media. Refugees from that system are ready for a new paradigm, one in which excellent journalism can co-exist with humane working conditions, and good old-fashioned survival can be humbly aspired to.

Look, there are bright spots. I work at one and I know New York isn't representative of what's happening in one paper or zero paper towns all over America, but maybe if you can make it here, you can make it anywhere. That's it for this week's show. On the Media is produced by Eloise Blondiau, Molly Schwartz, Rebecca Clark-Callender, and Candice Wang. With help from Shaan Merchant.

Brooke Gladstone: Our technical director's Jennifer Munson, Katya Rogers is our executive producer. On the Media is a production of WNYC Studios. I'm Brooke Gladstone. Happy Thanksgiving.

Micah Loewinger: Happy Thanksgiving. I'm Micah Loewinger.

[00:50:44] [END OF AUDIO]

 

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