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May 4, 2012, 10:40 a.m.

This Week in Review: Parliament hits Murdoch hard, and papers’ circulation is up (or down)

Plus: The debate over whether we’re in a tech bubble, Twitter’s news personalization efforts, and the rest of the week’s news in media and tech.

Parliament’s damning News Corp. report: It was a second straight week of big news in News Corp.’s phone hacking case, as a committee of the British Parliament issued its report on the scandal (PDF), in which the major statement was that Rupert Murdoch is “not a fit person” to run an international media empire like News Corp. The report also targeted three News Corp. executives in particular — former Dow Jones head Les Hinton, former News of the World editor (and current New York Daily News editor) Colin Myler, and former News International lawyer Tom Crone — for their roles in the scandal’s cover-up. The three may be forced to apologize to Parliament.

The New York Times and Guardian both offered good overviews of the report, with the Times focusing more on Murdoch and the Guardian on Hinton, Myler, and Crone. Both noted that the strong language about Murdoch was decided along political lines, with liberals voting to put it in and conservatives trying to keep it out. Capital’s Tom McGeveran wrote a helpful explanation of what it means for Parliament to call Murdoch “unfit” (he probably won’t get his broadcast licenses revoked anytime soon), and NPR’s David Folkenflik also had a good breakdown of the situation for American audiences. One of the committee’s members, Tom Watson, offered more of his own thoughts on the scandal, and the Times’ David Carr translated the report for those of us who don’t read Parliament-ese.

News Corp. responded by issuing a defiant public statement, which contrasted a bit with Murdoch’s more contrite internal memo. Other businesspeople and media barons came to Murdoch’s defense, and the British broadcaster BSkyB, of which News Corp. owns a share and recently tried to take over, distanced itself from News Corp. in an effort to hang onto its broadcast license.

There’s other trouble for News Corp., too: A Washington ethics group has called on the FCC to revoke News Corp.’s Fox broadcast licenses in the U.S., and in Britain, opponents of News Corp.’s BSkyB takeover bid said they had been blocked from meeting with the government department in charge of approving the deal. There is some good news for News Corp., though — the second half of the British government’s inquiry into the company may never happen.

As for the toll on News Corp., the Times has a solid big-picture view of the scandal’s impact so far, and Reuters’ Jack Shafer looked at the escape routes Murdoch could take. The Columbia Journalism Review’s Ryan Chittum said this report, and Murdoch’s testimony last week, have gone a long way in exposing News Corp.’s culture of corruption: “The glib denials that have served him so well for so many years aren’t working anymore—not with all we now know.” And the Guardian’s Henry Porter went further, writing the (probably premature) political obit for Murdoch.

Mixed signals on newspaper circulation: The Audit Bureau of Circulations issued its twice-annual report on newspaper circulation this week — here are its top 25 papers and a database of every daily newspaper in the U.S. Overall, newspapers saw a slight gain in daily circulation, including a 63 percent gain in paid digital circulation, which, as paidContent noted, includes tablet or smartphone apps, paywalled website subscriptions, and other e-editions.

The common narrative drawn from those numbers was that, as Ad Age put it, “digital paywall strategies have helped newspapers counter years of grinding declines in paid-print circulation.” Poynter’s Steve Myers looked at some of the top circulation gainers and saw that many of them had instituted digital pay plans, while very few of the losers had.

Media analyst Alan Mutter pushed back against that conclusion, noting that when you isolate print circulation, almost everyone’s numbers were down, whether they had a paywalled site or not. The circulation increase, it turns out, came from including those digital numbers (and, as Ad Age pointed, possibly counting subscribers twice), not from successfully protecting the print product.

A few newspapers that were highlighted: DCist noted that The Washington Post’s circulation drop was the largest of any of the nation’s top papers, while Poynter’s Andrew Beaujon said the decline wasn’t as bad as it appeared. J-prof Dan Kennedy looked at the numbers for the Boston papers, and the Lab’s Justin Ellis wrote about the story behind the Minneapolis Star Tribune’s increase in circulation and revenue, and its paywall.

Is tech in another bubble?: New York Times tech writer Nick Bilton became the latest to raise the specter of a bubble in the tech industry this week, reporting on the practice of startups being encouraged by their investors not to make money so as to make it easier to come up with ungrounded, outrageously high valuations. Said one Stanford professor he talked to: “This is 1999 all over again, but this time, it’s gotten worse…We’re back to companies throwing around funny money. The economic values don’t add up.”

This started another round of debate over whether we are, in fact, in the midst of another tech bubble. BetaBeat put together a helpful scorecard of who chimed in on which side, and you can read a smart, extended discussion among many of those people at Branch. Tech blogger Dave Winer said the true sign of whether we’re in a bubble is whether the startups being formed are good businesses that make sense and will grow (and answered that, yes, that means we’re in a bubble).

Investor and blogger Chris Dixon argued that the true measures of a bubble are actually quite nuanced, and we’re getting mixed signals in many of them, though he said no good investors engage in the “flipping” practices Bilton described, because it’s not a good business strategy anyway. Tech blogger MG Siegler agreed, calling stories like Bilton’s “a bunch of vague fear mongering.” GigaOM’s Mathew Ingram said it appears as though the inflated valuations are coming in at the small, early seed-money end, which presents less of a danger to the public. Entrepreneur Michael Mace made a similar point, arguing that until those inflated dollar amounts hit public stock offerings, this market won’t look much like the late ’90s bubble.

Twitter tries to further personalize your news: Twitter moved a bit deeper into personalized news this week with the revamp of its Discover feature, which will put a heavier weight in its algorithm on links shared by the people you follow to help you find links you’ll be interested in. (All Things D has a good description of the change.) The Next Web’s Drew Olanoff said the new format gives Twitter’s information some social context, which is a big part of what was missing before.

Mathew Ingram of GigaOM argued that while the update is an improvement, Twitter still needs to build better filters to personalize and make sense of its information, before others do it instead. YouTube’s Hunter Walk pointed out, though, that it’s extremely hard for a single product to guess at what you like, what your friends like, and what the world likes, especially in a linear format like Twitter’s.

Elsewhere in Twitter news, the Lab’s Adrienne LaFrance wrote about journalistic behavior by regular Twitter users, and news execs argued over whether social media is helping or hurting journalism.

Reading roundup: A few other interesting stories, and a couple of thoughtful viewpoints to direct you to this week.

— The FCC voted last Friday to require local TV stations to put their information about political advertising online, starting in the largest markets. Free Press applauded the decision as a victory for transparency, though ProPublica noted they won’t be searchable. Before the vote, Poynter’s Steve Myers pointed out how resistant TV stations have been to reporting on this issue.

— As The Next Web first reported this week, the Washington Post planned to buy the social news site Digg. That report was followed up with reports that the Post was hiring most of Digg’s staff, but not buying the site or its technology, leaving the remaining people there to scramble to figure out the site’s future.

— In an engaging book excerpt in New York magazine, Jeff Himmelman revealed that Watergate hero Bob Woodward’s longtime editor at the Washington Post, Ben Bradlee, had misgivings about some of the details about some of the sources Woodward and Carl Bernstein contacted, including Deep Throat. Woodward disputed the book’s claims, Himmelman defended them, and the Post’s Erik Wemple said he was skeptical of the reports of Bradlee’s doubts, too. Reuters’ Jack Shafer pointed out that this conflict is only about the All the President’s Men story, not the Post’s actual reporting.

— Two great posts of tips for journalists: Poynter’s Craig Silverman with a list of resources on how to verify information on social media, and the Guardian’s advice for journalists of the future.

— Finally, Danish scholar Rasmus Kleis Nielsen wrote an insightful piece for Reuters based on some ongoing research he’s doing on what’s hindering news startups in Europe. He calls it “irrational imitation” of the dominant online model of decades past.

Photo of Murdoch by Pierre Boulle, bubble by zzub nik, and newspaper boxed by Lulu Vision all used under a Creative Commons license.

POSTED     May 4, 2012, 10:40 a.m.
PART OF A SERIES     This Week in Review
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