Column: Pierre Omidyar and the bottomless optimism of billionaire publishers

Reuters News
Posted: Oct 17, 2013 5:23 PM
Column: Pierre Omidyar and the bottomless optimism of billionaire publishers

By Jack Shafer

Ebay founder Pierre Omidyar - reckoned to be worth $8.5 billion — inspired tens of thousands of journalists to freshen their resumes this week when word of his plan to start his own mass media organization leaked out. With Glenn Greenwald, Jeremy Scahill, and Laura Poitras announced as its first hires, the outlet will emphasize investigative journalism, but as Omidyar explained in a post, the site will serve all news.

Rattling his dumpster of cash, Omidyar will soon join other billionaires who made their money elsewhere and now peddle product at the newsstand, including Michael Bloomberg of Bloomberg News, Jeff Bezos of the Washington Post, Herb Sandler of ProPublica, Philip Anschutz of the Weekly Standard and the Washington Examiner, Mortimer Zuckerman of the Daily News and U.S. News and World Report, Richard Mellon Scaife of the Pittsburgh Tribune-Review, John Henry of the Boston Globe, the late Sidney Harman of Newsweek, and the late convicted felon Rev. Sun Myung Moon of the Washington Times. A whole junior varsity of sub-billionaire moneybags, including Wendy P. McCaw of the Santa Barbara News-Press, Jared Kushner of the New York Observer, Doug Manchester of U-T San Diego and Chris Hughes of the New Republic, have similarly bought their way into the news business to spread their influence or enrich democracy, depending on who is doing the telling.

Plutocrats the world over delight in owning media properties, and for good reason: Money can buy a lot, but unless you own a publication you're just one of the world's 1,426 billionaires - human cargo on a private jet, a delegator, an employer of lobbyists, another yakker in the opinion chorus. Moving to the head of the line requires the media club upgrade, which makes you and your publication a compulsory venue for campaigning candidates. Media properties are like musical instruments: when played just so, they compel your enemies to dance, as William Randolph Hearst of the San Francisco Examiner and New York Journal first demonstrated with his family's money in the 1890s, and the super billionaire Koch brothers would have discovered had they purchased the Los Angeles Times.

A week ago, few outside the tech and business worlds knew who Omidyar was, and even inside some newsrooms his name would have likely drawn a blank. Today he's a celebrity whose every utterance will be recorded, cataloged, analyzed, assessed, and yes, valued! Last week, he was just another billionaire who supported non-profit journalism (Center for Public Integrity, Columbia Journalism Review, and Honolulu Civil Beat, which he founded) and civil liberty organizations (Sunlight Foundation). Today, he's a budding philosopher king.

A decade ago, I charted the life cycle of the "vanity press mogul," the tycoons who dabble in the press with their excess millions: In the opening phases, the mogul opens the money throttle wide, hiring the best journalists and designers, and even voices the view that he'll make money where his predecessors made none to little. Then comes the morning after and with it sobriety. Too much red ink is flowing, to many projects over-budget and late, too many gifted wunderkinds spending wildly. Not even billionaires enjoy losing money forever. Then comes the reality adjustment, the downsizing, the prospecting for partners or "synergies," and often an exit from the media business, which attracts a fresh vanity mogul and restarts the cycle.

Because the past is not destiny, Omidyar need not ride the traditional wheel. Thanks to the Web and breakneck technological advances, the media business has acquired a volatility that favors new entrants over incumbents as never before, as the lightning successes of such well-funded, rapidly-expanding sites such as Huffington Post, BuzzFeed, Business Insider, Bleacher Report, The Verge, Quartz, Gawker Media, and others have demonstrated. Incumbency may actually be an impediment to success, barnacling owners to ancient methods and technologies in a way that clean-break media organizations are not.

Bezos's purchase of the Washington Post and Omidyar's as-yet-unnamed site offer a dandy laboratory setting for the testing of this thesis, as Bezos's renovation of an existing franchise will surely be judged in terms of Omidyar's startup. (Omidyar, by the way, window-shopped the Post when it was for sale.) The difference, of course, is that the Post is just one of the dozen vacations homes that Bezos owns or is in the process of expanding, whereas Omidyar appears to be building a single dream-home from the basement up. The Bezos purchase, however fanciful, is a practical move into the for-profit sector. Omidyar's venture, on the other hand, harkens back to the techno-idealism of the 1980s and 1990s, when the first impulse of computer scientists, programmers, and other techies was to change the world, not make more money. According to USA Today, he and his wife have committed more than $1 billion to hundreds of philanthropic causes.

Omidyar's first-round hiring of Greenwald, Scahill, and Poitras — who hail from the rich tradition of partisan American journalism — speaks to his idealism. Where Bezos is banking on an institution and its brand value, Omidyar is making his first-round investment in individual journalists whose work he admires. Like Hearst, who preached in favor of the "journalism of action" that battled corruption, incompetence, and got things done, I assume Omidyar has world-changing on his mind. Given the backgrounds of his first hires, it should come as no surprise that privacy, surveillance, and the NSA dominate Omidyar's recent Twitter feed. Still, he seems to have modulated his image to appear politically opaque. The Federal Election Commission donation database reveals a steady stream of donations to Democratic candidates, but hey, in 1999 he gave $1,000 to George W. Bush! It's not enough political baggage to fill a fanny pack, especially compared to that other ambitious startup, the emir of Qatar-owned Al Jazeera America. He comes close to being a clean slate.

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Omidyar's new venture — which will be all-digital, according to his interview with Jay Rosen, and in which he will invest at least the $250 million Bezos spent on the Post — won't fill a vacuum in national security reporting because there is no vacuum. Thanks to the good work the Guardian (the venue Greenwald just departed), the New York Times, the Washington Post, the Wall Street Journal, Reuters, the Associated Press, ABC News, NBC News, and many others have done and continue to do, we're experiencing a national security reporting renaissance. Depending on how the youthful Omidyar (just 46) sets up his operation — as a trust (like the one that the Guardian is eating up), or as an endowment, or as a multi-year fully budgeted project — we have reason to hope that no matter how market forces savage conventional for-profit journalism, at least one outlet funded by a devoted magnate will remain in the mix. Those of us who subscribe to religion should pray he lives a long and lucid life.

Journalism has traditionally been rejuvenated by the invasion of the orthodoxy by outsiders. William Randolph Hearst, Joseph Pulitzer, and Adolph Ochs stirred the pot in 1890s New York and the muckrakers played hell at the turn of the century. Radio made news immediate, the transistor made it mobile, and television made it visual. San Francisco leftists revived investigative reporting at Ramparts in the 1960s and the Web, well, y'all know how that outsider technology upended the established order.

As welcome as Omidyar's money is, his commitment to the investigative form and an open society is what I'm grateful for this afternoon. You can never uphold the correct verdict too often.

(Jack Shafer is a Reuters columnist. Opinions are his own.)