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 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 days.

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.

Brooke Gladstone: From WNYC in New York, this is On The Media. I'm Brooke Gladstone. It's a bad time for the news business. Actually, it usually is, but this is one of the worst. This year, a record number of job cuts so far, over 17,000 of them. Just this summer, the LA Times cut 74 staff positions, National Geographic laid off its staff riders, and earlier this year, NPR, Fox, NBC, Spotify, Insider, ABC, and Gannett also went under the knife. Gawker closed for the second time in May. MTV News folded, and Vice filed for bankruptcy, and in April--

News Clip: Internet media darling Buzzfeed is shuttering its news division.

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: It feels like the end of an era.

Brooke Gladstone: It wasn't always so dire. Buzzfeed was launched by Jonah Peretti amid the seemingly endless promise of digital news. In 2011, Peretti brought in Ben Smith to set up a newsroom to move Buzzfeed's content, best known for its quizzes and listicles, upmarket. Now, Smith is the editor-in-chief and co-founder of the new website, Semaphore, an author of the new book, Traffic Genius Rivalry and Delusion in the Billion Dollar Race to Go Viral. He wrote 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: 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."

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. I mean, 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 sort of new and delightful, and the idea that you could get journalism and baby pictures and memes and what was considered kind of fun and 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 platform 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 had 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, huh, this is this lovely new thing." 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: Yes, 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 right-wing populism embodied in the US by Donald Trump. Facebook and Twitter and these other platforms, they measured their success by 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: Yes, 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 and had the reasonable view that, oh, 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 sort of 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, Baked Alaska, stormed the capital 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 and the odds, the people who I was writing about, Jonah and Nick and others, just it was presumptively a progressive world and 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 like 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 find it pretty disturbing, and we clearly, I think we misunderstood or 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 that the late social media world gives you this illusion of a debate and of seeing all sorts of perspectives. Really what it's doing is, it's a machine for elevating the dumbest version of the argument you hate and showing it to you constantly and convincing you that people who you disagree with are just utter morons all the time. 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 saw a really interesting statistic that was stuck with me the other day that we published on 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. What's interesting is only 5% of people say it's him, and that's the biggest share of the market is somebody who has 5% of the market.

That'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 are very careful about how you run it, and can really provide good returns to good investors. It's not something where venture capitalists should be looking to throw in millions of dollars and see it multiply by 100 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 the author of the new book, Traffic. Coming up, two very different tales about profit and loss in digital news. This is On the Media. This is On the Media. I'm Brooke Gladstone.

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

Speaker 10: Nice to meet you.

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

Brooke Gladstone: 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 11: 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.

Brooke Gladstone: This is a poll conducted that same year 2010.

Speaker 11: It's the first time in the history of the polling that that has happened.

Speaker 12: We'd like to say that we're perfectly positioned because we have to figure out how we can be meaner, faster, and more dynamic than everybody out there. We don't want to get hot and die. We want to get hot and get hotter.

Brooke Gladstone: The next scene is probably the movie's most referenced. Carr is clacking away on his laptop in a glass 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 talks to me about cannibalism. New York Times, meanwhile, I was writing about surfing. I'm sitting there going, "You know what, I'm not going to talk about surfing. I'm going to talk about cannibalism."

David Carr: Time out.

Brooke Gladstone: 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 safari helmet, and when you looked at some poop-

Shane Smith: Sure.

David Carr: -it doesn't give you the right to insult what we do, so continue.

Brooke Gladstone: The scene captured the stubborn pride of the old guard and the refusal to compromise journalistic integrity even as it seemingly faced extinction. Fast forward to today, Vice got hot and died, bankrupt as of May, and the New York Times is harder than ever.

News Clip: After years of falling numbers, The New York Times is seeing a surge in subscribers, both print and digital.

News Clip: Just an unbelievable turnaround in The New York Times.

Brooke Gladstone: OTM correspondent Micah Loewinger takes it from here.

Micah Loewinger: 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. I spoke with technologists, current and former staff, and read, watched, and listened to every interview I could with the people who run the company. The Times declined to give me someone from the masthead to speak on the record. 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 that.

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 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. Then they launched this very painstaking effort to change their own internal culture to adapt belatedly to the internet. The guy who's 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 and 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, was pretty banal. All these people on the internet reading stuff, you might want to write for them. I think people who thought it also have 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.

Meredith Kopit Levien: The New York Times is going mobile.

Speaker: The New York Times is launching a new app called NYT NOW.

Speaker: Over the weekend, The New York Times handed out virtual reality goggles to its reader.

Speaker: In audio-only app their 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 subscribed 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. 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 Zhang: How do we actually get people to engage with The Times and build the habit in which we can expect people to just come regularly regardless of whether there is big news or not.

Micah Loewinger: Kathy Zhang 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 Zhang: 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 Zhang: Then maybe play some games during your lunch break.

Speaker 25: Wordle, The New York Times purchased the game for a seven-figure price tag.

Micah Loewinger: I'm more of a spelling bee guy myself.

Kathy Zhang: You go home, before you go to the grocery store and 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 podcasts or something.

Micah Loewinger: Like, say, a new show from Serial Productions, which The Times bought in 2020.

Kathy Zhang: 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 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. If they can get there, then they have all sorts of other things they can sell.

Micah Loewinger: Am I just naïve 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 think that seems like a reasonable goal for a subscriber business trying to serve its subscribers. 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?

Micah Loewinger: Yes.

Ben Smith: I think the thing is, some do. I think there are a lot of people who found the last decade of 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 flocked 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 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 Textio than Immedia COE. 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.

Clay Shirky: 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 kind of capital that other companies didn't. 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 what 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 an 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 Zhang: The reason that the company tries to 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 Zhang 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 Zhang: 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: They did have companies on it like Netflix and Spotify. 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 $38,000?

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." 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's 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. 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. This is a--

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

[laughter]

Stacy Cowley: I like to focus on that part.

Micah Loewinger: There is 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 and 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 of 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. 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. 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]

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 L.A. 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.

[music]

Brooke Gladstone: Coming up. 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: 5-2.

Micah Loewinger: 5-2. Okay.

Brooke Gladstone: This is On the Media. This is On the Media. I'm Brooke Gladstone. Wall Street loves The New York Times leadership, which has paid out hundreds of millions of dollars to investors over the past few years. Meanwhile, a cohort of new outlets across the US are trying to wrestle journalism away from big capital, experimenting with a cooperative business model in which the journalists co-own and co-run their own outlets.

There's the Colorado Sun in Denver, Racket in Minneapolis, Maximum Fun, a podcast company in Los Angeles. In New York, there's Defector, a sports and culture website, and the local news site, Hell Gate. When the NYC friends and rivals met last month in Brooklyn to play softball, Micah was there to take notes.

Micah Loewinger: Hellgate was winning when I arrived at McCarran Park where I found a group of 20 years so writers, editors, and ringers from other newsrooms drinking 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 seventh.

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+, 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. 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 co-workers who will surely make fun of me for so earnestly crediting them on the record. I already regret a little bit saying that out loud.

Micah Loewinger: [chuckles] 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. 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 wanted 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, "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. The writers asked all 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. 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 the 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 like this group of people, and those readers left Deadspin and some of them subscribed 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. 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: 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: Jasper.

Micah Loewinger: Did he just score a home run?

Speaker: Yes. Oh, damn. Jasper's really good.

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

Speaker: 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. We want to make sure we finish the job here.

Micah Loewinger: This is one of Hell Gate's founders, Christopher Robbins. Chris is up, you're up, top of the order. He hit a pop fly, 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 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 were 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 like, 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 reported 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.

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

News Clip: 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, and 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: Yes, it's pretty anti-capitalist of him. 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 seven-person team met to discuss finances and the future of the site.

Speaker 41: 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 the 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: 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 raise money, what do you mean?

Nadia Tykulsker: Our goal is to be subscriber-funded, but we have a runway of-- 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.

Nick Pinto: Advertising, sponsorships, stuff like that, like the entrepreneurial side of things outside of subscriptions.

Micah Loewinger: Yes. 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. The other imperative is to treat ourselves like human beings who deserve health insurance and to make a living wage. We're now looking at 300 some thousand dollars just to get through the end of next year. I think we should all just really absorb that.

Nadia Tykulsker: It's been absorbed. It's fully absorbed. [laughs]

Micah Loewinger: Come on, Dad, let us get the health insurance. They have 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.

Max Rivlin-Nadler: Let's get our hands in because we're going to have these [inaudible 00:48:53] runs back.

Nick Pinto: 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, Hell Gate. 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 writeup of the game. Hell Gate must solemnly report a bitter truth, Defector writers are good at sports or at least better than us, and so 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.

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 coexist 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? From The Media, I'm Micah Loewinger.

Brooke Gladstone: And that's the show. On the Media is produced by Eloise Blondiau, Molly Schwartz, Rebecca Clark-Callender, Candice Wang, and Suzanne Gaber, with help from Shaan Merchant. Our technical director is Jennifer Munson. On the Media is a production of WNYC Studios. I'm Brooke Gladstone.

 

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