Opinion

Felix Salmon

Link-phobia and plagiarism

Felix Salmon
Oct 17, 2011 05:17 UTC

Jack Shafer has an unforgiving take on l’affaire Kendra Marr:

The plagiarist defrauds readers by leading them to believe that he has come by the facts of his story first-hand–that he vouches for the accuracy of the facts and interpretations under his byline. But this is not the case. Generally, the plagiarist doesn’t know whether the copy he’s lifted has gotten the story right because he hasn’t really investigated the topic. (If he had, he could write the story himself.) In such cases he must attribute the material he borrows so that at the very least the reader can hold somebody accountable for the facts in a story.

Or to put it another way, a journalist who does original work essentially claims, this is true, according to me. The conscientious journalist who cites the work of others essentially makes the claim that this is true, according to somebody else. The plagiarist makes no such claims in his work. By having no sources of his own and failing to point to the source he stole from, he breaks the “chain of evidence” that allows readers to contest or verify facts. By doing so, he produces worthless copy that wastes the time of his readers. And that’s the crime.

This is all true. But Marr reminds me of Zack Kouwe more than anything else. And if Marr pulled a Kouwe, she isn’t guilty of the crime that Shafer is accusing her of.

Kouwe was never cut out to be a blogger. When he saw a good story on some other site, he would re-report it, rather than just link to it. And I suspect that what happened with Marr was similar.

Let’s say that Marr saw a NYT story about Senator X. She thinks it’s an important story, she phones up Senator X’s office, asks them if the story is true, and they say yes. The right thing to do, in that case, is to link to the NYT story, and say that you’ve confirmed it with your own sources. The wrong thing to do is to try to rewrite the story yourself, since you haven’t really reported it, and you don’t really know what you’re talking about. And the way you get caught doing the wrong thing is by using NYT copy wholesale, without attribution. Then you can get done for plagiarism.

But still, you did confirm the facts in the story; you can, with honesty, say this is true, according to me.

What we saw with Kouwe, and what I think we’re seeing with Marr, is a peculiar new form of plagiarism — one that exists only in a world of continuous news. In the olden days, if you saw a story in the NYT and wanted to copy it, you would have to wait a whole day until your own paper came out, and that would give you lots of time to do your own reporting and write your own story. These days, there’s a lot of pressure, at places like Dealbook and Politico, to match stories quickly — so quickly that it’s significantly easier to just copy-and-paste your rival’s material than it is to craft your own story when you’re not much of an expert on it in the first place.

In the age of the link, such activity should never need to happen. But there’s a reason that the plagiarist copies rather than linking. And the reason is that linking and aggregation is still not remotely as respected, in newsrooms, as reporting is. So some young reporters, wanting to make a name for themselves, plagiarize instead of linking, in an attempt to take credit for the work of others. It’s still — quite rightly — a firing offense. But it’s not quite — or not necessarily — the crime that Shafer hates so much. It can just be a horrible side-effect of link-phobia, which exists even at web-native publications like Politico.

COMMENT

Late to comment but I think that over at ZeroHedge there is an interesting and very successful approach to blogging. It begins with Tyler Durden using the innocuous byline “Submitted by Tyler Durden” at the lead of every main page article, which provides continuity (almost like a brand or seal of approval). In some cases the article that follows is by another author whose identity is presented in a secondary byline or within the text. In other articles ZeroHedge will from time to time make extensive use of research and analysis ironically from the banks that he/they are so critical of. In every case they are careful to provide attribution of the research though perhaps not strictly according to the Chicago Style.

A case in point is this recently published and excellent article based in part on analysis from Morgan Stanley and featuring graphics prepared by Morgan Stanley.

The Truth Behind Europe’s (€1.7 Trillion) “Triangle Of Terror”
Submitted by Tyler Durden on 10/21/2011

http://www.zerohedge.com/news/truth-behi nd-europes-%E2%82%AC17-trillion-triangle -terror

Posted by diegoSi | Report as abusive

On George Soros, Occupy Wall Street, and Reuters

Felix Salmon
Oct 13, 2011 20:44 UTC

Wouldn’t it be ironic if Occupy Wall Street — the soi-disant “99%” — were being secretly funded by billionaire Davos Man George Soros, exemplar of the 1%? Well, no, it wouldn’t, actually. As Noreen Malone points out, lots of the 1% have, like Soros, expressed sympathy with OWS, including Bill Clinton, Ben Bernanke, and at least one member of the Buffett family. And when you’re sympathetic to a cause, and have lots of money, often you donate money to that cause.

But in this case it looks very much as though there’s no connection at all between Soros and OWS. That makes sense: for one thing, Soros is a creature of Wall Street himself, and for another, he tends to fund well-organized groups with specific goals. Which, clearly, OWS isn’t.

Which is why today’s Reuters story about the connection between Soros and OWS has elicited so much derision around the blogosphere. Beyond allowing us to shoehorn the #ows and #soros hashtags into a single tweet, there’s no real substance to it at all:

There has been much speculation over who is financing the disparate protest, which has spread to cities across America and lasted nearly four weeks. One name that keeps coming up is investor George Soros, who in September debuted in the top 10 list of wealthiest Americans. Conservative critics contend the movement is a Trojan horse for a secret Soros agenda.

Soros and the protesters deny any connection. But Reuters did find indirect financial links between Soros and Adbusters, an anti-capitalist group in Canada which started the protests with an inventive marketing campaign aimed at sparking an Arab Spring type uprising against Wall Street. Moreover, Soros and the protesters share some ideological ground.

Yes, there are people — led, it would seem, by Rush Limbaugh — who are loudly speculating that Soros is funding OWS. There might conceivably be a story in their rabble-rousing, which could point out that Soros’s agenda is hardly secret — it’s right there on his website for all to see.

Alternatively, as John Carney points out, there’s an interesting story in the way that OWS has raised money, through crowdsourced means like Kickstarter.

But the angle we went with is not a story, especially since Soros says he’s never even heard of Adbusters.

According to disclosure documents from 2007-2009, Soros’ Open Society gave grants of $3.5 million to the Tides Center, a San Francisco-based group that acts almost like a clearing house for other donors, directing their contributions to liberal non-profit groups. Among others the Tides Center has partnered with are the Ford Foundation and the Gates Foundation.

Disclosure documents also show Tides, which declined comment, gave Adbusters grants of $185,000 from 2001-2010, including nearly $26,000 between 2007-2009.

The Tides Center is not some great sloshing pool of money which takes in money and hands it out. Yes, one of the many things that it offers foundations is the opportunity to create collective action funds, enabling a group of donors to channel their money in a collaborative manner. The fact that Soros gave money to Tides and that Tides gave money to Adbusters in no way means that there’s an “indirect financial link” between the two. That’s like saying that there’s an “indirect financial link” between me and Mitt Romney, because I lend money to Citigroup (I’m a depositor at Citibank), and Citigroup has given money to Romney.

Besides, OWS wasn’t even dreamed of back in 2009. If somehow some Soros money did make it to Adbusters between 2007 and 2009 — despite Adbusters co-founder Kalle Lasn’s clear statement that “he’s never given us a penny” — then that’s still a good two years away from any connection to OWS.

The article is particularly problematic from my perspective because I’m incredibly proud of Reuters’s long tradition of impartial journalism. I’m on the opinion side, not bound by such things, and if you think I’m biased you’re right. (I should mention here explicitly that this post, just like everything else on this blog, is my personal opinion. It may or may not be shared by others within the organization. But it should emphatically not be taken as representing the views of Thomson Reuters.)

Reuters news stories like the one about OWS are held to a very high standard of integrity, independence, and freedom from bias. And there’s lots in this article which tilts hard to the right.

There’s the idea that Rush Limbaugh is a good place to look if you want someone to “sum up the speculation” and provide the news hook for the entire story. The idea that the Council on Foreign Relations is a “liberal cause”. The idea that the protests were “triggered” by a campaign poster featuring a “battle-ready mob” of people “dressed in anarchist black”. The description of OWS as “the so-called occupation”. And then there’s this:

Since its obscure beginnings, the campaign has drawn global media attention in places as far-flung as Iran and China. The Times of London, however, was not alone when it called the protests “Passionate but Pointless.”

Reuters cannot — must not — get a reputation as a right-wing media outlet. We have to report the news as impartially as we can. In this case, there was no story, and nothing to report. Inventing a tenuous and intellectually-dishonest link between Soros and OWS might get us traffic from Matt Drudge — but that’s traffic which, frankly, we don’t particularly value or care for. Much more importantly, it serves to undermine the heart of what Reuters stands for. And we can never afford to do that.

Update: After a rather confusing series of events, the old version of the story is still online, while a recast version is here. Both of them now carry the headline “Soros: not a funder of Wall Street protests”. Which is an improvement.

COMMENT

Just as I thought — FELIX has no response and can’t admit he’s been had.

Posted by NHampshire | Report as abusive

FT Tilt, RIP

Felix Salmon
Oct 13, 2011 15:32 UTC

It never even made it to its first birthday. FT Tilt, the high-priced emerging-markets blog launched with some fanfare in January, has now quietly died.

This is a sad day: Tilt was run by the FT’s two most innovative journalists, Paul Murphy and Stacy-Marie Ishmael, and was a bold attempt to view the developing world from a novel perspective. The FT could and should learn a lot from Tilt’s innovations, not least the rich and various forms of engagement it had with its readers.

The FT should also learn from Tilt’s failures, which are to be found in the business model rather than in the journalism. Tilt was a blog run by a small team of smart young journalists — but it was priced at thousands of dollars a year, and I could never understand where the value was meant to lie. Those journalists had amazing sources and language skills in countries around the world, but they were ring-fenced from the FT itself, and didn’t really contribute noticeably to the newspaper. Ironically, they might actually contribute more now, going forwards, in the wake of Tilt’s execution: FT spokeswoman Darcy Keller tells me that the newspaper is trying to find jobs for them. I hope it does; as Stacy says, they have done tremendous work, and deserve to be rewarded for it.

The model of charging very large amounts of money for information about global markets which is relatively cheap to collate just doesn’t seem to work — Tilt is now dead, and Roubini.com is up for sale. The fact is that smart, economically-literate people are never going to be that cheap — so you need to have some kind of decently-sized market for what they do. And both Tilt and Roubini.com have been priced way too high to reach even a four-digit subscriber base. What’s more, these kind of services get better as their audience grows — they learn from their audience. Keeping the audience artificially tiny by implementing a massive paywall is self-defeating.

No startup ever achieves success in less than one year, so the FT’s decision with respect to Tilt does seem hasty. What they should have done is make Tilt free to all FT subscribers, and see if it took off that way. FT Alphaville has proved that bloggy brand extensions can be extremely successful, if done right, and Tilt’s material was certainly of great interest to a very important part of the FT’s global audience.

It’s good for media companies to experiment, and it’s necessary that some of those experiments fail. But I don’t think that FT Tilt failed, in terms of its core journalistic output. I think that the FT got greedy for subscription revenues from day one, and never let Tilt grow and thrive as it could and should have done. I absolutely blame the overlords for this one, not the people who did the real work.

Update: Richard Desai-Green, Roubini’s CFO, responds:

We have 1,000 clients.

You seem to be treating info published in the media as fact but in fact the CNBC journalist had his numbers wrong.

We are cash flow positive.

We’re well capitalized.

We are continuing to hire people.

We just opened an office in India and hired 9 people.

We’re continuing to grow our business.

We can never say we won’t sell the company but I can say at this time we don’t have any offers and the executive team of our company is as committed as ever.

September was a record sales month for us and we’ve started October really well and expect our growth to continue.

COMMENT

Felix, your post has sparked off some thoughts. I’ve quoted you in a blog on the closure of Tilt ‘a cautionary tale of product development’ just published bit.ly/rWRUef

Posted by wdowen | Report as abusive

News Corp’s ethics cancer grows

Felix Salmon
Oct 13, 2011 06:39 UTC

The latest shenanigans at News Corp are particularly shocking because they took place at the Wall Street Journal — the flagship publication which was meant to be insulated, at least in part, from Murdoch sleaziness. But this is really bad: the WSJ Europe was telling its advertisers that it had a circulation of 75,000 — but in fact fully 31,000 of those copies were bought for as little as 1 cent apiece by companies which never saw them, and pawned them off onto random students.

And when one of those companies decided that even 1 cent per copy was too much to pay, the WSJ decided to simply buy up the papers itself, with its own money.

Oh, and the WSJ also demolished the wall between editorial and advertising, promising — and delivering — editorial coverage to the companies it was doing business with.

There was a whistleblower, too, who wound up with the sack:

European human resources executive Carol Bosack emailed the whistleblower: “You are expected to keep details and your reaction or beliefs about the recent events confidential and not shared with anyone external or internal to the business. This matter is to be kept between us, Andrew [Langhoff], Internal Audit and Corporate Legal.” No action was apparently taken at that time on the whistleblower’s allegations. The whistleblower, who had worked for Dow Jones for 9 years, was made redundant in January.

Only after the Guardian started asking questions was Langhoff finally forced to resign.

Jack Shafer makes some very good points about all this — among them, that the suspect news stories were in “special sections” which nobody reads, and that the real scandal about the WSJE’s circulation was that even padded it only managed to reach 75,000. Rupert Murdoch is probably dying to kill off this paper as he did the News of the World; it surely loses him a fortune.

But the thing which jumps out at me is that News Corp is still keeping true to its strategy of covering up anything embarrassing until Nick Davies uncovers it, at which point an executive or two is thrown under the bus. As crisis management goes, it’s a disaster — and now it’s claimed the scalp of senior Dow Jones employee number two. (The first, of course, was Les Hinton.)

As a result, the rest of the world is simply going to assume the worst — that anything rumored or imagined is probably true and has just been successfully covered up for the time being. That’s really bad for News Corp. The only silver lining is that for the time being, all of the wrongdoing has been confined to the newspaper businesses. If anything gets uncovered at Fox or Sky or HarperCollins, it’s surely all over for Rupert — the culture of corruption will have been shown to have infected the entire organization. News Corp has kept things quiet until now, in those organizations. But how long can it continue to do so?

COMMENT

I think it’s fairly obvious to those who want to see it that Murdoch’s news empire is corrupt, and those who don’t want to see it will manage, once again, not to.

Posted by JayCM | Report as abusive

How to lose a bet in style, Nick Denton edition

Felix Salmon
Oct 13, 2011 05:53 UTC

Nick Denton lost his bet with Rex Sorgatz by the narrowest of margins — just 10 million pageviews, or alternatively just four days. But he handed over a check for $100 with a smile, and even threw us a huge party into the bargain! Hence, obvs, my not-entirely-sober status by the time we’d waited for Lockhart Steele to finish his eleven-course dinner and make his way up to the Gawker Media rooftop.

Here’s to next year — when Denton will have to achieve 700 million pageviews in order to avoid writing a second check. I promise to film the outcome, whoever the winner might be.

COMMENT

you ever tried a silent disco?
silent disco is a great way to party :-)
here some places to visit
http://www.silentdiscotheque.com/silent_ disco.html
http://soundtransporter.com/
http://silentdisco.de/

Posted by silentdisco | Report as abusive

Charts of the day, WSJ story-length edition

Felix Salmon
Oct 11, 2011 20:06 UTC

Ryan Chittum has taken a look at the length of the stories on the front page of the WSJ.

Here’s what’s happened to the number of stories under 1,500 words:

wsjunder1500.jpg

Here’s the stories over 1,500 words:

wsjover1500.jpg

And here’s the stories over 2,500 words:

wsjover2500.jpg

Ryan is dismayed at these trends. “Without going long,” he writes, “it’s hard to achieve greatness”:

Certainly, the Journal still does lots of top-flight work, and most stories don’t need 2,500 words. But many do, and how does going short as a policy help readers understand the really important stuff like systemic problems, corporate misbehavior, business innovation, or sweeping economic change?

I, on the other hand, am much more sympathetic to what Murdoch is doing here. WSJ readers are busy: they don’t have time to wade through lots of overstuffed stories in the morning. They want to know what’s going on, and why, and they want their news-delivery mechanism to be as efficient as possible.

If you look at the chart of stories over 1,500 words, it peaked at 800 per year in 2006. That’s more than 2.5 such stories per day, every day including Saturdays. And that’s just on the front page! If you look at the paper as a whole, the 1,500-word stories were appearing at a pace of six per day before Murdoch came along and brought some sense to proceedings.

I read long business and finance stories for a living — that’s my job — and I don’t read six per day, let alone six per day from a single publication. The job of the WSJ is not to overload its readers with many hours’ worth of reading every day. And the current pace, of roughly one long-form front-page story per day, seems much more reasonable to me. (Most readers, of course, won’t even read that — but at least they won’t be completely overwhelmed.)

At the same time, it’s great that the WSJ is putting lots of important information on its front page in sub-1,500-word form — on top of the “What’s News” briefs. As a news consumer, I don’t even want anything nearly that long — I’m looking to get what I need within a few hundred words at most. US newspaper stories have a lot of water weight, and nearly all of them could stand to lose a few pounds.

And what of the dramatic fall-off in the really long-form stuff, over 2,500 words? Up until 2007, those managed to make the front page roughly every other day. Then they all but disappeared, and you’ll find maybe one a month at this point.

I can easily see why that should be the case. Very long stories are often highly self-indulgent, and they take a huge amount of time, effort, and money to put together. Sometimes, they’re incredibly important, and well worth both writing and reading. Often, however, they seem to be aimed at other journalists more than at the WSJ’s core business audience — most of which simply doesn’t have the time to read such things. In a good news organization, I think, the bar should be high before any such story is inflicted on millions of blameless readers. And keeping the output of long-form stories low is one great way of doing that.

The Columbia Journalism Review is naturally going to want to encourage “greatness” in American newspapers, and for decades now “greatness” in journalism has been synonymous with Very Long Stories. But I don’t think, frankly, that the WSJ’s readers have any particular interest in getting a serving of greatness alongside their breakfast cereal in the morning. They’re much more interested in news. And that, to its credit, is what the WSJ is giving them.

COMMENT

The WSJ has readers? Are you certain??

http://www.antipope.org/charlie/blog-sta tic/2011/10/going-down-hard.html

Posted by klhoughton | Report as abusive

Market reports are hurting America

Felix Salmon
Oct 10, 2011 21:29 UTC

Last week, Chao Deng published her “memoirs of a market reporter” at CJR.

Critics say markets reporters must suffer from A.D.D., because short-term fluctuations in stock indices really don’t matter much in the long run. They say it’s absurd to pin a single narrative on spot news involving countless individual decisions, many of them made by robots. Too often, coverage favors one slant if stocks are up and another if stocks are down when, in fact, nobody really knows.

And yet, the bigger the swing in the Dow, the more urgent the need to chase down an explanation, even if it’s a short-term one. Indeed, larger swings actually predict greater reader interest, which, in turn, validates the coverage.

She’s half right. It is absurd to tie narratives to intraday market moves. On the other hand, it’s even more absurd to chase down an explanation, especially when most of the time there is no explanation. Yes, readers demand such things. But they only harm themselves by doing so.

Here’s Chao criticizing one of her own headlines:

In response to one of my pre-market stories headlined “Futures Gain on Obama Jobs Plan,” for example, a reader had commented:

Can you prove that Obama’s $300b plan which has no chance of passage is the reason for futures being up today. There have been many days where futures rebounded after 300+ points of losses. Pretty sloppy reporting.

In retrospect, I wish the headline had been that futures were gaining “ahead” of the President’s jobs speech. Then I would have been laying out a possible reason for the gains in futures but not definitively pinning down on one. It’s a word game, sure, but words matter, and a small tweak would have resulted in a more accurate headline.

This kind of ridiculous Clintonian language-parsing helps no one, except insofar as it applies a wafer-thin layer of CYA to a practice which is fundamentally absurd. “I never said that stocks rose because of the jobs plan, I said they rose ahead of the jobs plan! So, I’m not saying that there is a causal relationship there, just that there might be! And you can’t deny that!”

Chao does try another tack, which is closer to David Gaffen’s argument in the video above:

All this might lead you to conclude that the market moves randomly most of the time, and we shouldn’t even try to find out why. But wait. Throwing our hands up is just as extreme an overreaction as pinning a day’s move on a single event. For one thing, it’s a sure way to lose readers, who are grasping for an explanation. For another thing, there are ways to do it reasonably without falling into the over-simplification trap.

Actually, faced with inexplicable moves in the stock market — and the vast majority of intraday moves are inexplicable, in that no one really has a clue why they happen, or whether there’s a reason for them at all — throwing our hands up is an entirely rational reaction, and not an overreaction at all.

There will always be readers who want some ersatz explanation of what the market did today; there will always be news organizations pandering to those readers. But if you’re a media organization which stands for reporting the truth in a high-quality manner, then market reports are a dangerous place to go, because they’re all built on quicksand.

Is it possible to do market reports “reasonably, without falling into the over-simplification trap”? I think it probably is, if you report on what the markets have been doing over the course of a few weeks or months, and you do a lot of reporting and thinking. But if you’re writing a dozen market reports a day? No. None of those are going to have real value.

Market reports should not be an everyday staple of news coverage. Sometimes, occasionally, there are stories in the markets. And then those stories can be reported. But when there aren’t any stories, there’s no point in trying to invent them. And so the daily report — let alone the intra-day report — is at heart a stupid piece of journalism. Some are better than others, to be sure. But none of them are any good.

COMMENT

@Danny_Black I appreciate your adherence to the strict definitions and I agree I mangled them. Your comments show me that I may have muddied the waters for the sake of simplicity. However, this discussion was initiated to talk about why I thought market reporting is rubbish, not to discuss how I may have muddied the waters. To go back to my original point, market reporting is garbage for two reasons. (1) We will always be limited with our our predictive capability because outside of toy-problems found in textbooks, we never know all factors and we can never measure them with enough precision. There is always one more decimal place that we cannot attain. As long as we cannot know all factors, we will have an imperfect prediction. As long as we cannot measure with infinite precision, we will always have an imperfect prediction. Just as with the butterfly effect, a small imprecision (the decimal place we cannot attain), there is the potential that our prediction will be rubbish. (2) Markets are complex adaptive systems. As mentioned, small things can feed back (or forward) into each other to result in large effects. Consumer confidence is one of the variables that influences market behavior. It has a circular relationship with market reporting. That circular relationship means that whatever coefficient you use in your regression equation will always be changing and adapting. These feed off of each other. Given that we cannot measure these with infinite precision and that they are constantly changing, we find ourselves in the situation of Point 1, that the predictions will likely be rubbish because small differences can have substantial effects.

Posted by cptcodfish | Report as abusive

How the New Yorker monetizes old content

Felix Salmon
Oct 10, 2011 17:33 UTC

I love the way that The New Yorker is using the iPad to construct a whole new revenue stream from its back issues.

It started* with “At the Ballpark”, an iPad-only collection of New Yorker baseball writing from 1929 to 2011, featuring the likes of John Updike, David Grann, and of course Roger Angell. That was sponsored by United Airlines.

The baseball collection was followed by a golf collection (Ogden Nash, Larry David, United Airlines again), and now by a “sustainability” collection sponsored by BMW and featuring the likes of John McPhee and Michel Specter.

Nearly all of these pieces are timeless, just waiting to be rediscovered. And the New Yorker’s archives are so deep, and are of such high quality, that there’s really no limit to how many of these things it can produce. Each one is very cheap to put out — just cobble together a bunch of articles under a theme, and get a TNY writer to pen a short introduction. Meanwhile, the advertisers get to align themselves with popular or trendy subjects (golf, “sustainability”), and reach an audience which is affluent even by New Yorker standards.

I’m in the process right now of helping to put together a printed anthology of business writing, from many different sources; such compilations can be very good, but they’re also a lot of work to put together, in terms of securing permissions and going through the laborious process of collating, printing, and distributing physical books. The New Yorker’s special iPad editions piggyback on the existing New Yorker iPad app, and are therefore very lightweight, with a marginal cost which is tiny in comparison to TNY’s printed compliations. What’s more, instead of persuading thousands of individual book buyers to shell out cash for books, the sales job on the iPad editions is much easier: you just need to persuade a single corporation to buy a single sponsorship.

TNY has experimented with selling digital compilations, too — its 9/11 e-book is $7.99. And the more different models and revenue streams, the better. But the small sponsored collections are for me the most exciting, from a business-model perspective. It’s hard to sell old content — but it’s much easier to repackage it and get a sponsor to pay you to do so.

*Update: The first of these, it turns out, wasn’t the baseball one, it was “The Digital Revolution“, sponsored by American Express. It came out on June 6.

COMMENT

God, but your signin system sucks! And the New Yorker is really doing a lousy job with these digital collections: I spent ten minutes trying to find someplace on the web to buy them, to no avail.

Posted by MaysonLancaster | Report as abusive

Blodget returns to Wall Street

Felix Salmon
Oct 5, 2011 20:40 UTC

Three years ago, NPR’s Madeleine Brand introduced a segment with Henry Blodget with these words:

Let’s go now to someone who knows a little something about financial bubbles bursting: Henry Blodget. He had a front-row seat during the dot-com boom: he was a tech stock analyst at Merrill Lynch from 1999 to 2001. Well, now Merrill is gone, sold off to Bank of America over the weekend, and Henry Blodget is gone too, banned from Wall Street after being charged with fraud.

Well, if Henry Blodget was gone in 2008, he’s definitely back in 2011. And while he’s still banned from the securities industry, he’s not banned from Wall Street: in fact, he’s positively welcomed there. He rang the opening bell at the NYSE this morning, which, judging by the huge grin on his face, made him feel even better than getting a $7 million check a couple of weeks ago to expand Business Insider.

How did Blodget manage this turnaround? Well, he started a blog, Internet Outsider, which wonderfully still exists, although it hasn’t been updated in almost four years. Kevin Ryan, impressed with the blog, turned it into a fully-fledged business, called Silicon Alley Insider. And the rest, well, is history.

The move from an outsider-branded blog to an insider-branded for-profit site marked the point at which Blodget started to focus intently on creating a website which would be as addictive as possible for readers, and cause them to come back as often as possible, generating as much revenue for himself as he could muster. Giving your media business a name like Inside.com or Business Insider is one way of justifying high ad rates: the idea is to sell advertisers on the idea that your site is being written by and for high-value professionals. These names may or may not mean much to readers, but to advertisers, Business Insider is always going to be a more attractive buy than Internet Outsider.

Similarly, for all that Blodget reacted rather defensively to my post on his over-aggregation, I was mainly trying to be descriptive rather than prescriptive. Putting up a vast amount of content on a daily basis is pretty much a necessary precondition for being a successful website. As is making that content as sensational as possible, with screaming all-caps headlines, striking photographs of pretty girls, or anything else which makes people click. I work in Times Square: I see for myself every day how people flock to an overstimulative environment. And creating such an environment online is the secret not only of TBI’s success, but also that of HuffPo.

For that matter, it’s the secret of CNBC, too: lots of whizzing graphics and manufactured cacophony. Both TBI and CNBC feature a huge quantity of market reports with negative added value: they’re giving a running commentary on a volatile market, making their viewers nervous and giving them an ersatz need to know what’s going on now. And the fact is that traders love this stuff — I defy you to find a trading floor which doesn’t have a TV tuned to CNBC. And truth be told, at any given point in time, some computer on that floor is going to have a TBI tab open too.

TBI is also a breath of fresh air for anybody who wants to cut through the clutter of stodgy reporting and get to the heart of the matter quickly:

“On Wall Street, I’d consistently submit a report that would say, ‘This is going to be roadkill,’ and it would come back rewritten as ‘We see some weakness,’” Blodget says. “Now I can say, ‘It’s going to be roadkill.’ That’s very satisfying.”

TBI stories are short, they’re punchy, they say what they mean, and they have a distinctive, provocative, voice. They’re not always true — but traders don’t care so much about what’s true, they care only about what people are saying and thinking right now. Media stodginess is a luxury of monopolists: the minute that media outlets start to seriously compete with each other, they always become increasingly sensationalistic. And TBI is competing not only with dozens of other news websites, but also with all the other addictive content online, including Zynga and Facebook. Henry doesn’t have the luxury of writing carefully-considered pieces and letting them stand on their own merit. His role has two parts to it, and unless he can make his carnival-barker job work, he’s going to get fired from his business-analyst gig.

Blodget’s VIP status on the floor of the NYSE today shows how far he’s come from the dot-bust days of his disgrace. Wall Street doesn’t much care about that any more — and neither does it object to TBI’s sensationalistic tendencies. Wall Street has always been a place of short memories and short attention spans. And Blodget knows just how to appeal to that audience.

COMMENT

Whenever I accidentally click a link to TBI I immediately click off. They have mastered what currently works, but when what currently works shifts, as it always does in online media, I am guessing they’ll be out in the cold again.

crap content = crap company no matter how much money they raise. It’s a horrible user experience reading SAI. And who cares what traders read or don’t read. They are neanderthals convinced they are homo erectus.

I spent years on a variety of trading desks.

Posted by zacharycohen | Report as abusive
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