Big cable gets bigger: Comcast, the U.S.’ largest cable company, announced Thursday that it plans to buy the nation’s second-largest cable company, Time Warner Cable, for $45 billion. The deal is subject to the approval of federal regulators, and Comcast is reported to have to shed 3 million of Time Warner’s subscribers to bring the combined company’s market share down to 30 percent in order to appease them. The Week’s Peter Weber said he expects the deal to be stopped by regulators at some point, though many others saw it as likely to go through.
So why is Comcast making the move? As The New Yorker’s Ken Auletta and Gizmodo’s Brian Barrett pointed out, the simplest explanation is that increased size gives Comcast more leverage against networks’ rising retransmission and carriage fees, as well as a bigger buffer against the growing share of cord-cutters, especially since the two companies don’t share many markets. Om Malik of Gigaom focused on broadband, noting that it’s the most profitable division of both companies and that Comcast caps its users’ broadband data, but Time Warner doesn’t.
Comcast needs to make its case to regulators (and to the public) for allowing the merger, and Recode’s Peter Kafka said it’ll come down to the argument that cable companies don’t compete — they’re confined to specific geographical areas, carved out by local regulators. Comcast is also saying that because of the two companies’ efficiencies of scale and possibility of new product offerings, the deal is somehow both “pro-consumer” and “pro-competition.”
Comcast is expected to be able to better negotiate lower retransmission fees for networks with the deal, which might theoretically benefit users, but as Poynter’s Al Tompkins noted, could also really squeeze local TV stations. Comcast also cited competition from Google Fiber as well as online video services like Apple, Netflix, and Hulu as competitive threats justifying the deal, though James McQuivey of Ad Age argued that even with the acquisition, Comcast may not be able to hold off Google and Apple on the online video front. Likewise, The Guardian’s Heidi Moore called it a desperation move that’s “likely to be a short and unhappy marriage.”
As Slate’s Matthew Yglesias pointed out, on the consumer side, there really isn’t any cable competition to begin with, so this deal will take us “from zero to two times zero.” But The Los Angeles Times’ Michael Hiltzik and intellectual property scholar Susan Crawford both argued that the lack of competition will continue slow companies’ investment in broadband and fiber-optic infrastructure, which results in cheaper and slower Internet connections than are standard in much of the rest of the world. Said Hiltzik: “Our fat and secure cable monopolies simply don’t feel competitive pressure to provide customers with the fastest speeds at reasonable, affordable rates. When they do get pressured, they respond.”
The Guardian’s Dan Gillmor also decried the deal as a competition-suffocating disaster for consumers, and The Verge’s Bryan Bishop also said the deal will further damage ISP competition and end any chance for new blood in the cable market. Business Insider’s Jim Edwards focused on the prospect of broadband data caps, which both companies are keen to impose.
First Look launches with The Intercept: First Look Media, eBay founder Pierre Omidyar’s new $250 million public-affairs news organization, launched its first “digital magazine,” The Intercept, this week. The microsite is built around Glenn Greenwald, Laura Poitras, and Jeremy Scahill, and will be focused on surveillance and civil liberties issues, with a special emphasis on revelations from the Edward Snowden documents in the short term. Journalism.co.uk had a good, quick overview of who’s involved with First Look, and the Freedom of the Press Foundation’s Trevor Timm highlighted The Intercept’s decision to make its site HTTPS encrypted by default, arguing that it should be standard practice for every news organization.
The Washington Post’s Erik Wemple noted The Intercept’s use of the language of “assassination” rather than the government- (and traditional media-) preferred “targeted killing” in its initial National Security Agency story. Techdirt’s Mike Masnick praised First Look for releasing new photos of U.S. intelligence sites into the public domain, but criticized them for claiming excessive copyright protections on their text.
Foreign Policy’s Elias Groll looked at The Intercept’s big-picture goal — “tipping the scales of power away from the intelligence community” — and Capital New York’s Johana Bhuiyan talked to First Look’s Eric Bates about its immediate goal of publishing stories based on the Snowden documents. Bates said the organization has no specific timetable for reporting on the documents, while Andrew Sullivan of The Dish was concerned that The Intercept “inherently leverages vital public information — the NSA docs — to help fund and launch a website.” If Greenwald & Co. are truly focused on doing public-interest journalism, Sullivan said, they should release them as quickly as responsibly possible, rather than withholding them to release them in a way that benefits the site financially.
Lloyd Grove of The Daily Beast questioned whether First Look can attract top talent with a figure as polarizing as Greenwald as its frontman, though Bates told him that the organization’s ambitions are much broader than something strictly Greenwald-centric. NYU’s Jay Rosen, a First Look adviser, explained how it’s structured to allow numerous personal franchise sites like The Intercept. (He also gave a more in-depth talk on the personal franchise model, which you can listen to here.) Despite his distaste for the label “digital magazines,” Gigaom’s Mathew Ingram said that First Look’s emphasis on targeted niche-based sites is one of his biggest reasons for optimism about the venture.
Mo’ traffic, mo’ problems at Facebook: The recent conversation about Facebook’s dominant role in the dissemination of news (or news-like substances) continued this week with thoughtful pieces by Reuters’ Felix Salmon and The Atlantic’s Derek Thompson. Salmon traced the shifts from traditional news to a search- and blog-dominated news paradigm to the current one oriented around personally based information personalization, concluding that it’s broadening our definition of news and making journalists more portable and easily aggregated. Thompson explored the differences between the newsier most-searched-for stories of the year and the fluffier top viral stories of the year. Facebook’s News Feed “is perhaps the world’s most sophisticated mirror of its readers’ preferences—and it’s fairly clear that news isn’t one of them,” Thompson wrote.
The Lab’s Joshua Benton also expanded on this theme of social news replacing search-based news and applied it to the more emotionally oriented headlines we’re seeing at viral-content sites. Danny Sullivan of Search Engine Land objected to the premise that social is replacing search, sparking a smart discussion with Benton about news organizations’ emphases on social and search.
The flip side of this social ascendance of news is that the sites that best take advantage of it are also most dependent on the whims of the social networks they rely on for distribution — in this case, Facebook. Business Insider’s Nicholas Carlson claimed that some of the social web’s top publishers, especially Upworthy, are taking traffic hits because of a November change to Facebook’s algorithm of how often posts show up in News Feeds. Upworthy countered that the traffic hit Carlson described was merely a cyclical bump, not a function of any Facebook algorithmic tweak.
Carlson also noted that BuzzFeed’s traffic jumped at the same time its viral competitors’ dropped and speculated that it’s because BuzzFeed buys Facebook ads to drive traffic to its native ads, though as Gawker’s Adam Weinstein noted, he quickly walked the quid-pro-quo accusation back. Slate’s Will Oremus argued that it’s highly unlikely that Facebook is jiggering its News Feed algorithm in order to benefit advertisers.
Henry Taylor of The Media Briefing explained just how well BuzzFeed’s native ads do on social sites relative to other ad forms and how important they are to BuzzFeed’s strategy. And here at the Lab, Joshua Benton highlighted a discussion of Gawker’s own (apparently rather ineffective) practice of buying Facebook ads to drive traffic to its native ads as well.
There’s also the matter of buying ads on Facebook to draw users not to another ad, but to Like a Facebook page, which appears to be a problematic process as well. Science blogger Derek Muller claimed that “click farms” of people Liking hundreds or thousands of Facebook pages to boost follower counts for ad clients, puffing up page audiences with meaningless followers that actually decrease their relative engagement and push them further down News Feeds.
Facebook denied that fake Likes are rampant there, though PandoDaily’s James Robinson found some corroborating evidence for Muller’s claim in his own Facebook ad-buying experiment. Slate’s Oremus countered that fake Likes don’t help Facebook and accused writers of being too eager to believe stories of Facebook’s nefarious deeds.
From the Times to a nonprofit startup: Bill Keller, who was The New York Times’ executive editor from 2003 to 2011 and has been a columnist for the paper since then, announced he’s leaving the Times for the Marshall Project, a new nonprofit site focusing on the American criminal justice system. The Marshall Project is a project of Neil Barsky, a former Wall Street Journal reporter and hedge fund manager.
Keller talked to NPR’s Renee Montagne and the Lab’s Justin Ellis about the move, telling NPR that the Marshall Project won’t be practicing advocacy journalism per se, but something more in line with the Times’ tradition of objectivity-based investigative journalism. He talked to the Lab about growing the site’s audience, and Barsky pegged its annual budget at $4 million to $5 million, with a newsroom of 20-something employees. Barsky also talked to Newsweek’s Zach Schonfeld about how he came up with the idea for the site and where it’s headed.
There was some criticism about the move: Gawker’s Hamilton Nolan said that as a dyed-in-the-wool old media person, Keller is “almost certainly not the best man to lead an online journalism startup of any sort” and that his jump to a startup from such a cushy traditional media gig is “a great flashing sign that reads, ‘Newspapers are the past.’” Politico’s Dylan Byers detailed the bad blood between Keller and some of the Times’ brass.
John Cassidy of The New Yorker was encouraged by the launches of both the Marshall Project and The Intercept, seeing them as two different forms (the latter with a more ambitious and troublemaking goal) of a more targeted, online-based model of public-interest journalism. Reuters’ Jack Shafer, meanwhile, noted the wealthy patrons like Barsky and Omidyar who are swooping in to fund investigative journalism as the news organizations that have housed it for so long continue to be hollowed out.
Reading roundup: There were quite a few interesting developments and pieces to check out this week. Here are a few:
— Reporters Without Borders released its annual World Press Freedom Index, and the U.S. dropped from No. 33 to No. 46. (The U.K. dropped three spots to No. 33.) Free Press’ Josh Stearns sounded the alarm on the U.S.’ falling ranking, though The Washington Post’s Max Fisher said it’s not a significant drop in the long term. The Committee of Protect Journalists looked more closely at the NSA’s pressure on the journalists who report on it.
— One of France’s largest newspapers, Libération, announced last weekend that it would become a “social network” and would turn its newsroom into a cultural center, prompting a headline and editorial in protest, a strike, and the resignation of the paper’s editor. Gigaom’s Mathew Ingram urged the paper’s staff to be more open to change and the community it serves.
— Mashable reported that Twitter is testing a very Facebook-like profile redesign, to which ReadWrite’s Matt Asay and Wired’s Ryan Tate responded by calling for the two social networks to stop trying to mimic each other. As The Wall Street Journal noted, Twitter’s biggest problem is user indifference, something a Facebookization might be trying to resolve.
— A couple of smart pieces about journalism education: Lehigh professor Jeremy Littau on navigating the tension between the journalistic goals of accuracy and truth and the educational model of learning through failure, and Nebraska professor Matt Waite on resolving the “our curriculum is too full” problem by incorporating necessary non-traditional skills (in this case, math) into basic journalism courses.
— Finally, a couple of interesting pieces from late last week: Sulia’s Jonathan Glick at Recode on the rise of the platform-meets-publisher (or, as he calls them, “platishers”), and Circa’s David Cohn on rethinking CMSes to prioritize structured data rather than simply narrative.
Photo of Comcast remote by MoneyBlogNewz used under a Creative Commons license.