Tech has been toying with media for many years now, but Peter Thiel's recent multi-million dollar attack on Gawker is the clearest sign yet that Silicon Valley might be ready to unleash a cataclysmic assault on the fourth estate. Is Thiel the final horseman? And, if so, who rode in before him?
Everyone always thought it would be Mark Zuckerberg who’d end up crushing the press beneath his heel, but if he wants the satisfaction of hearing it crunch he’s going to want to hurry up.
For while we’ve all been keeping our eyes on Zuckerberg, a number of other Silicon Valley billionaires have ridden in his shadow, wreaking apocalyptic havoc with the media landscape behind him, sowing the seeds that could well lead to its ultimate destruction.
What’s more, they have gone about doing so in exactly the way that the prophecies foretold.
Their names? War, Famine, Pestilence and Death.
Or, as they’re better known: Peter Thiel, Arianna Huffington, Jeff Bezos and Pierre Omidyar.
Each has done something different in their attempt to ‘disrupt’ journalism – and their powers combined may well turn the industry to dust before Zuckerberg has a chance even to lift his foot.
War
What’s His Name? Peter Thiel
Who Is He? Best known for co-founding PayPal, Thiel was also the first investor in Facebook (and still sits on their board).
What’s His Deal? A classic tech-libertarian, Peter Thiel is the type to get a twitch in his trousers any time Ayn Rand gets mentioned. Such is his devotion to the idea of a free, utopian state where techtrepreneurs can work freely without the tentacles of government getting all up in their business, Thiel was the most high-profile investor in the Seasteading Institute – a organisation set up to investigate the feasibility of building floating cities in the centre of the sea. Islands on stilts, built in international waters where their citizens were free from pesky federal regulation. The type of thing that would make the Church Of Scientology blink and rub its eyes in disbelief.
How Is He Involved In All This? Thiel has just unveiled himself as an unexpected heavyweight in the game. A story of revenge nearly ten years in the making, last week he was revealed as the mastermind behind a decade-long surprise attack on the New York gossip website Gawker.
This is what happened.
Earlier this year, Hulk Hogan took Gawker to court, suing them for $100m in damages after Gawker published a highlights reel of an apparently secretly-recorded sex tape which showed Hogan chucking it up his former-best friend’s wife.
We’ve written about the particulars of that case elsewhere, but all that’s important to know here is that Hogan won – and won big. The jury awarded him $140m in damages: $40m more than he wanted and about $100m more than anyone realistically expected him to get.
It was an absolutely brutal result for Gawker. They had been braced for a loss, but to nothing like that degree. Damages that severe could bankrupt the company, and if they don’t manage to reduce the sum (or overturn the judgment) on appeal then it could be the end of Gawker. The actual end of them.
How does Peter Thiel factor into all of this?
Thiel, it turns out, was anonymously bankrolling Hogan’s legal fees. Not out of some charitable sense of philanthropy (though he has tried to position it as such) but as a cold, calculated revenge tactic.
Gawker used to run a specialist blog (what now gets call a ‘vertical’) dedicated to the goings on of Silicon Valley, named Valleywag. Back in December 2007, Valleywag published an article (headlined with typical Gawker panache): Peter Thiel Is Totally Gay, People.
Outing people has always been one of the dicier parts of Gawker’s editorial mission. Their insistence on doing so has cost them dearly before. Last year, they chose to out a high-level executive working at Condé Nast, which caused massive uproar from both their peers and the public at large. In response, Gawker deleted the post which caused a second, internal revolt within Gawker’s editorial team – with an executive editor and editor-in-chief of gawker.com quitting as a result.
Bad though the fall-out from that 2015 story was, they had no idea that Peter Thiel was busy quietly fulfilling the promise he had made to Gawker founder Nick Denton if Gawker ever outed him: that he would rain down “destruction” on Denton and “other innocent civilians caught in the crossfire”.
Looks like he really wasn’t joking.
Why Is This A Bad Omen? The merits and ethics of Valleywag drawing public attention to Peter Thiel’s sexuality are definitely worthy of discussion and debate, but was it bad enough to shut down an entire media organisation? No. And Peter Thiel knows that because otherwise he would have sued Gawker himself back in 2007.
Instead, he waited and waited and waited for the perfect moment to pounce. In the Hogan case, Thiel spotted his chance. A way to do the sort of damage he has wanted to do to Gawker for ten years, but has never had the legal grounding to do so.
For a relatively minor investment ($10m – less than 0.5% of Peter Thiel’s net worth) in someone else’s case, Thiel could drive Gawker into the ground – and this isn’t the only lawsuit that he has coughed up for.
If the constant litigation does eventually shut Gawker down, it will be as much to do with the fact that they wrote an unflattering (but unactionable) piece about Thiel in 2007 than it ever was about publishing Hulk Hogan’s sex tape.
And that sets a very, very scary precedent.
Famine
What’s Her Name? Arianna Huffington
Who Is She? The founder and titular Huffington of the Huffington Post.
What’s Her Deal? Once described by LA Magazine as “the Edmund Hillary of social climbing,” Huffington is one of those multi-hyphenate power players who charms everyone she meets and will turn her hand to absolutely anything. A media presence who crops up everywhere – be it in her role as author, political pundit, society darling, or actress – the word ‘Huffington’ soon switched from surname to globally recognised brand when her blog-turned-news-aggregator-turned-unstoppable-content-juggernaut was sold to AOL for $315m.
How Is She Involved In All Of This? There’s an interesting anecdote that Laurie David (the environmentalist activist and ex-wife of Larry David) tells about Arianna Huffington in an old Vanity Fair.
Laurie had been talking with Arianna for months about the devastating effects that the US’s gas consumption was having on the world – both in terms of the environment and geopolitics. The impression Laurie got from Arianna during these discussions was that they were both of the same mind: that things needed to change.
However, when Laurie went to visit Arianna at her home she noticed Arianna had a huge gas-guzzling SUV sat in her driveway. Confused, Laurie pointed out this little inconsistency to Arianna. The next time the two met, Arianna had sold the SUV and replaced it with a electric-hybrid Prius.
This, Laurie says, shows that Arianna is open to change. She listens when people talk to her. She can be convinced of things. She is not afraid to admit the error of her ways and change her behaviour accordingly.
In everything, it seems, except one respect. Paying writers.
Despite having made her name and her personal fortune as an author and journalist – being paid (and paid well) for her own writing – Huffington refuses to pay the vast majority of contributors to her site.
At least not in actual currency. Contributors to HuffPo do so in exchange for ‘exposure’.
Being featured on a platform as widely read as the Huffington Post is, apparently, payment enough. Why would you need to pay your electricity bill if you’re bathing in the warm glow of readers’ adoration?
This salary block doesn’t extend to the site’s staff. The executives and editors who work for AOL or Huffington herself get paid. It’s just the 100,000 contributors that HuffPo claims to have writing for it who don’t.
And it’s not like no-one has pointed this out to Arianna. This isn’t the SUV idling away in her driveway, waiting to be replaced. Lawsuits have been filed against the Huffington Post about this. Boycotts and strikes have been initiated. A decade’s worth of editorials has been pointed at them chastising them for this practice, with some going so far as to compare it to slavery.
Yet has Arianna been convinced of anything? Not even slightly. Whenever this criticism gets levelled, not only does HuffPo brush it off, it actually tries to present its policy of not paying writers as being beneficial for everyone involved.
HuffPo’s
UK editor was on Radio 4 earlier this year trying to suggest that, by removing any trace of filthy, corrupting money from the writing process, the Huffington Post actually delivers a purer product than publications which pay.
His rationale – and the general ethos of HuffPo? “If I was paying someone to write something because I want it to get advertising, that’s not a real authentic way of presenting copy. When somebody writes something for us, we know it’s real, we know they want to write it. It’s not been forced or paid for. I think that’s something to be proud of.”
Something to be proud of.
Why Is This A Bad Omen? Fewer people are buying newspapers with every passing year. Print advertising is about to fall off the cliff as journalism is increasingly gathered and consumed online. The rush to publish digitally is greater than ever, but no-one yet seems to know how to make that pay.
One of the few publications which has found a decent stream of revenue is the Huffington Post – but in refusing to pay professionals, instead outsourcing the work to hobby bloggers, it is making the career utterly unsustainable.
The habit of getting writers to work for free (especially online) is not exclusive to HuffPo. It happens all over the internet. But nobody has done more to normalise and promote the culture of volunteer journalism than Arianna Huffington – a woman with a nine-figure net worth who somehow can’t seem to scrape together enough to pay the serfs who made her name so valuable.
Still, at least they get exposure.
And it’s not like anyone ever died of exposure.
Pestilence
What’s His Name? Jeff Bezos
Who Is He? The founder and CEO of Amazon.
What’s His Deal? Currently 5th on the Forbes List of Billionaires, Bezos is the predominant force in e-commerce and online retail. Since the mid-90s, when it started life as an online bookshop, Bezos has gone on to turn Amazon into an all-encompassing retailer of all manner of goods and services – described by one biography as “The Everything Store”. Beyond his involvement in Amazon, Bezos has also been a prominent investor in many tech companies spanning not just the planet, but outer space too. He is everywhere.
How Is He Involved In All Of This? Three years ago, Jeff Bezos added to his burgeoning portfolio of acquisitions, by becoming the owner of the Washington Post – buying it for $250m.
Buying a newspaper is not, in and of itself, an unusual thing for a rich man to do. Newspapers have long been a popular purchase for the multi-millionaire hoping to drum up a bit of publicity for his wares.
Rupert Murdoch, for example, is a notorious cross-promoter. Films made by 21st Century Fox get huge coverage in his tabloids. Books published by HarperCollins are serialised in his broadsheets. Columnists in his papers get regular gigs on his news channels.
Or Richard Desmond – who promotes his own Health Lottery on Channel 5, secures exclusive interviews with the stars of Celebrity Big Brother in OK!, and gave his own autobiography a five-star review in the Daily Express.
The crucial difference with Jeff Bezos however is that he’s not a media baron. He’s in retail. Where Murdoch and Desmond just have TV shows and magazines to plug, Amazon sells everything. Taking ownership of a newspaper therefore presents a much greater opportunity to Bezos than it does to anyone else.
It’s more than a simple case of Bezos preloading the Washington Post app onto Amazon Kindle Fires, or offering cheap subscriptions through his company’s own e-readers though (both of which he does). The plague has spread much more widely then that.
Look at Uber – the cab-hailing service which is doing so much to ‘disrupt’ the taxi industry. Bezos was an early investor in Uber. Although the exact details of his investment are unknown, it is thought his stake in the company could be worth as much as $1.5 billion.
Ordinarily it is considered good form to disclose whether or not the newspaper’s owner has an estimated $1.5 billion shareholding in the companies it is covering – but not at the Washington Post. At least not regularly.
There are a couple of examples of WaPo making it clear that their owner has a large financial stake in Uber. More often than not though they neglect to mention it completely, and Uber is a company they are writing about daily – sometimes multiple times per day.
One article from which a disclosure is notably absent is the one that criticises fellow horseman Arianna Huffington for joining the Uber board of directors. The journalist is entirely correct to cite the obvious conflict of interests that will arise when the Huffington Post covers Uber if the editor-in-chief is an executive there. However, even though disclosure is the very issue at hand, the Washington Post editors somehow completely fail to mention that their own owner has a much larger stake in the company.
And it doesn’t stop there, because Bezos doesn’t just have his fingers in a few pies. He is wrist-deep in dozens of them.
Another company that Bezos has stumped up some cash for is Business Insider – who also do an equally sloppy job of acknowledging the fact that they are giving prominent column inches to companies in which one of their investors has a significant financial interest.
This piece from New Year’s Eve 2015, for example: Don’t Complain About Uber’s Surge Pricing Tonight.
Aside from the imperative command of the headline, the piece then goes on to give a number of impressive stats about Uber’s business performance over the past year – the type of information you might find on, say, a press release or something. Any note of disclosure, attached to it? No, of course not.
Nor is there one on How To Use Uber.
Or Why Uber Won.
Or Uber’s Customer Support Is About To Get A Lot Better.
To be fair to Business Insider, they don’t always forget to include a note of disclosure when talking about Jeff Bezos’s investment and his ownership of the Washington Post.
Even if they do occasionally need a little nudge…
Why Is This A Bad Omen? Both the Washington Post and Bezos himself will insist that he has no influence over the editorial content of the paper – as will Business Insider – but the trouble is that ‘influence’ is actually incredibly hard to isolate and identify.
Bezos owns the paper outright. He bought it with personal funds and therefore doesn’t need to answer to shareholders. The only person to answer to, ultimately, is him.
Which is one thing when you’ve bought a mid-sized paper as a minor vanity project; but when you’ve bought the paper of record in the capital city of the world’s big economy – one of the most iconic titles in the world; a paper whose word really counts for something – the effect is potentially limitless.
So while Bezos may not be actively spiking stories himself, or pitching feature ideas at editorial meetings, his ownership alone is enough to have an influence on the paper. It’s unavoidable – and he doesn’t need to actually do anything for it to happen.
And, as we’re about to see with Pierre Omidyar and his adventures into journalism, sometimes doing nothing is the worst thing you can possibly do.
Death
What’s His Name? Pierre Omidyar
Who Is He? The founder of eBay.
What’s His Deal? In a sea of Silicon Valley dick-swingers, Omidyar is an unusually reclusive and timid figure. A wearer of flip-flops and beaded bracelets, he resisted the lure of San Francisco and chose the relative peace and quiet of Honolulu instead – partly to distance himself from the rest of the tech pack, partly because of his looming fear of global catastrophe. You see, somewhat unnervingly, Omidyar has a touch of the Doomsday prepper about him. He has reportedly stockpiled emergency rations of food across America, and owns a remote ranch in Montana that he and his family can retreat to in the event of an apocalyptic disaster.
How Is He Involved In All Of This? Omidyar suffered a huge bout of FOMO when the announcement was made that Jeff Bezos had bought the Washington Post. He had been made the exact same offer by Don Graham previously but had turned it down, feeling that the price of $250m was too high.
But once the deal was done he realised he’d had his head turned. So as Bezos took control of the Post, Omidyar decided he would start his own media organisation. Thus, First Look Media was born.
Investing the same amount that Bezos had shelled out to acquire the Post, Omidyar pledged $250m of his own money to the project and began to assemble a crack team of journalists who had caught his eye. Among those he poached were Matt Taibbi of Rolling Stone, Ken Silverstein of Harper’s and John Cook of Gawker. The marquee signings for Team Omidyar though were Glenn Greenwald and Laura Poitras: the journalists who worked with Edward Snowden to break the NSA surveillance scandal.
He set them all up to work across First Look Media’s two proposed titles: The Intercept (which was Greenwald and co.) and Racket (Taibbi’s baby).
For a brief moment everyone there was full of enthusiasm at the prospect of starting up a new, hard-hitting organisation, one which promised to produce “aggressive, adversarial journalism across a wide range of issues”.
In practice though, things went south very quickly.
Nine months later, with Racket still unlaunched, Taibbi left First Look to rejoin Rolling Stone.
Two weeks after that, Cook left to return to Gawker – preferring to walk back into the brewing gak storm surrounding Hulk Hogan (the one Peter Thiel was whipping up from the sidelines) than stick around.
It wasn’t until Silverstein left three months later that the blood and guts really started to spray though. Shortly after his departure, Silverstein wrote a scathing portrait of life at First Look for Politico, entitled Where Journalism Goes to Die – which, among other things, helped explain the reason for such a mass exodus.
Silverstein claimed that Omidyar’s micromanagement of the business side was suffocating everything. For all of his talk about giving journalists the freedom to report fearlessly, when it came to actually running the company, Omidyar wasn’t really all that interested in supporting the newsroom or facilitating good journalism. That’s why Racket folded before publishing a single word. That’s why The Intercept had such a rocky start, such a drastic implosion and such a shaky recovery.
According to Silverstein, Omidyar just couldn’t get anything sorted. He watched on as story after story languished in a weird sort of purgatory – with Omidyar’s constant faffing about budgets, hires and expenses taking priority over actually publishing anything.
It must have been tremendously annoying for Silverstein to be scooped so frequently and see the stories he had worked on getting picked up by other papers – but at least they were getting picked up somewhere. Because the same isn’t true of the biggest story that First Look was sat on.
In buying up Glenn Greenwald and Laura Poitras – the only two people with full access to Edward Snowden’s files – Omidyar had effectively bought up the rights to the NSA surveillance scandal. That meant that the papers which had previously been running those stories suddenly had their supply cut off.
The papers in question? The Guardian and… the Washington Post.
It wouldn’t have been so much of a problem had The Intercept been in any fit state to publish, but because of the hopeless management, further developments on the NSA story were delayed for months on end.
Being hopeless at management is fine if you’re running GOOP (all due respect to Gwyneth Paltrow) but when you are the sole outlet in charge of publishing the story of government-sanctioned national surveillance programs, it becomes a much more serious state of affairs.
Why Is This A Bad Omen? The amounts of cash that the venture capitalists of Silicon Valley are prepared to slosh about haven’t been seen in media for years and years and years – if ever.
Money is the major answer to a lot of journalism’s biggest problems at the minute, so it is no wonder that journalists are following it wherever it goes.
To a team of journalists, $250m is a significant, serious sum. To Pierre Omidyar, it’s a fraction of his net worth. For all the hassle it would cause him to lose it completely, he could have thrown it down on a hand of blackjack.
But for that money – and with very little effort – he has managed to throttle the life out of one of the most important news stories of the century so far.
If we are to follow the Book of Revelation to the letter (as apocalyptic prophesies go, it seems like a fairly solid blueprint) then the arrival of Death on his pale horse is the signal that Hades, Lord of the Underworld, is due to appear any moment.
Hades’ job, more or less, is to polish off what the horsemen started. Namely: hand out white robes to those who have done the Lord’s bidding, then seriously feth up the rest of us with fire and dragons and meteors.
When that happens, there is no return. It is quite literally a scorched earth situation.
Hopefully the bickering that is currently taking place between the horsemen – Bezos and Huffington being fussy over Uber; Omidyar having nobbled the Washington Post’s stories; Thiel and Omidyar’s longstanding beef; Huffington joining Thiel in sticking a sly boot into Gawker while Omidyar and Bezos attempt to stand up for free speech – will delay the Devil’s arrival long enough to form some sort of defence.
But given that the Washington Post, the Huffington Post, and Peter Thiel’s personal investment portfolio all draw a significant wedge of their power from Facebook and the traffic that it drives, it could well be that Mark Zuckerberg is Hades, Lord of the Underworld – and he’s already here.
So it’s lucky he’s such a benevolent, merciful and handsome master to have, isn’t it?
)
. On appeal can we rule that both sides forfeit all of their money and are banned from ever being in public again?
