Peoria Pundit

Considering I’ve blogged about it, I’ve been remiss in mentioning that GateHouse Media and the New York Times settled out of court on the issue of whether a Web site owned by the NYT can scrape the content of GateHouse newspapers and put in on a competing Web site.

Critics of GateHouse Media was out of their minds with indignation that a media company would object to anyone linking to the content. Others, myself includes, actually looked at the site the NYT had put up and concluded what they were doing wasn’t simply linking or making fair comment, but using GateHouse content to comprise the content of their own portal page. Since both companies sell ads on competing portal pages targeting the same readers in the same geographic area, I could see why GateHouse would object.

Just as they were about to go to court, they settled. the NYT agreed to stop it. GateHouse agreed to stop suing the NYT. In other words, GateHouse won. The people who criticized GateHouse for wanting to end links (which is bull) were happy because they thought it averted a catastrophe for the Internet.

I’m printing the memo GateHouse sent to employees in the New England area. Read more »

Remember how the New York Times mentioned a rumored affair between Sen John McCain and a lobbyist as a way to illustrate a way McCain might be behaving unethically if in fact the rumors might be true? Well, she’s suing.

GateHouse picked the right time to file a lawsuit against the New York Times Company. My blog was down, so I couldn’t comment.

Here’s the story in a nutshell: GateHouse runs local Websites out in Massachusetts called “Wicked Local.” In fact, GateHouse has a history of putting a lot of emphasis on the Web, and they’ve been pretty successful out there. Well, the Boston Globe — owned by the New York Times Company — has launched some competition, a site called “Newton.”

The site includes links to articles from GateHouse newspapers, as well as a paragraph from the articles in question.

In other words, The NYT is doing to GateHouse what I do the Journal Star (owned by GateHouse). I link to articles and include one or two (maybe three or four) paragraphs. Here’s the difference: I’m not competing with the Journal Star. And I generally offer some commentary of my own.

The online world has responded mostly negatively to the suit. David Carr of Seeking Alpha practically accused GateHouse of being a bunch of Luddites:

I am not making this up. If this sounds like a court case that might have occurred in the early 1990s, when sites of all kinds were just getting used to the Intarwebs, that’s because it is virtually a carbon copy of some of those early cases. The argument in a nutshell is that GateHouse is mad because the Times (or rather, the Boston Globe, which is owned by the same company) is “scraping” its headlines and the first paragraph of stories, and then “deep-linking” to the stories themselves, thereby copying the site’s content and stealing its traffic (as Mike Masnick at TechDirt points out, GateHouse is also apparently suing for breach of contract, because its articles are Creative Commons-licensed, but with a non-commercial license).

Jeff Javis was especially harsh:

The more I think about it, the angrier I get at Gatehouse for its dangerous and hypocritical crusade against links.

Links are the bloodstream of the web, carrying its oxygen. Links are how original journalism will get audience, traffic, branding, attention, credit, and monetization. Links are a gift and a courtesy. Links are the means to better-informed communities. Links tie people together with each other and the information they need. Links are necessary. Links are good.

And:

So what should happen here? Should Gannett sue Gatehouse? Should we all just sue each other for linking to each other – for doing what the web is all about?

Look, GateHouse certainly isn’t a very sympathetic character. But I think Jarvis is refusing to see both sides in this.

But I found one blogger, j-blogger Noah Bombard, who sees where GateHouse is coming from:

The GateHouse suit addresses not so much the linking to their content, but what in some cases appears to be the almost exclusive use of its content to populate a site the Globe is theoretically making money on. Without GateHouse content, the site would be much more sparsely-populated. GateHouse alleges they’re doing all the work by reporting on local issues and news while The Globe is doing little more than putting up their own site and taking GateHouse content.

Well, when I visited Newton today, I saw only two links from any Wicked Local site, so it wouldn’t be all THAT scarcely populated. Still, there is something uncouth about a news organization with the resources of the New York Times Company creating a ad-laden portal page that’s based almost entirely made up of content from other news sites and blogs. I don’t think Newton is anything like a search-oriented news aggregation site like Google News, and it sure isn’t some blog using “fair use” to  comment on the local media.

In other words, I don’t blame GateHouse for being mad as Hell.

One of my favorite bloggers ever is PollyPeoria. She hardly ever blogs these days. This is her third this year. But it’s a good one:

My grandfather, a Great Depression survivor, keeps a lockbox of cash and gold coins underneath his bed and a loaded hand gun in his nightstand drawer. I’ve always thought it a quaint, naive, sad, and paranoid practice. After watching Fannie Mae, Freddie Mac, Lehman Brothers, Merrill Lynch, and industry giant AIG either bite the dust or require government intervention in order to avoid doing so, Grandpa’s lockbox is looking like the most sound financial policy of them all. The beauty is in it’s simplicity and the fact that Grandpa’s plan is rooted in the rarest of all commodities: COMMON FRIGGIN’ SENSE.

It has become “common sense” to assume the government is going to come along and cover your losses. Working hard, and using YOUR OWN MONEY is now considered a quaint concept, one honored only by wild-eyed libertarians.

I’ve never begrudged people who got rich because they or their parents wither worked harder or smarter than other people. People who risk their own money deserve to reap the profits. But when the government come along and eliminated the possibility of risk, well, sorry folks. That’s not capitalism. It’s using the playing rules to accomplish social engineering.

Consider this 1998 article in the New York Times. It is clear that lower standards for determining who gets home loans was done specifically to increase the numbers of poor and minority homeowners, and that everyone know at the time that doing so would put the entire home financing system at risk. But Fannie Mae and Freddie Mac needed to get the Department of Housing and Urban Development off their back.

Here are the money quotes:

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980’s.

”From the perspective of many people, including me, this is another thrift industry growing up around us,” said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.”

I saw “Mad Money” analyst James Cramer on NBC the other day. He was ridiculing the idea that the bailout mania was unwarranted. He said we are on the verge of the 2nd Great Depression. I’m not buying it. A few months ago, he was telling people to buy. No doubt he’ll soon begging selling the idea that nothing is wrong, all is well.

Our economy is sick. It’s not a disease, but our bad habits. I don’t see anyone running for office now with the guts to stand pat and let the people who lost money to really lose their money. These bailouts aren’t going to save THE economy, but they will keep specific players from losing their shirts.

But we don’t PLAN in this country. We react. So Congress and the President will come up with a scheme to bail out some businesses. And political crisis averted, we’ll end up with an economy that’s just a little more centralized and a little more susceptible to downturn. But that will happen when someone else is president. So we’re all good.

Feh. Double feh.

What does the New York Times, considered by some to be the newspaper of record for America, have in common with newspapers owned by GateHouse Media, including the Journal Star?

Apparently, dividend cuts:

New York Times Co. faces increased financial pressure to cut its dividend as credit quality deteriorates amid record advertising declines.

Bondholders are paying for the Sulzberger family’s decision last year to raise the quarterly dividend 31 percent to 23 cents a share. The extra yield investors demand to own New York Times bonds instead of U.S. Treasuries has more than doubled in 2008. The cost to protect the debt against default has climbed 27 basis points since the newspaper publisher posted earnings July 23, meaning investors are betting that credit quality will weaken further.

Moody’s Investors Service says one way for New York Times to save its rating, a step above junk and in danger of being cut, would be to reduce the dividend costing $132 million a year.

“They’d have potentially more cash available to fund investments and debt reduction,” Moody’s analyst John Puchalla in New York said in an interview.  “Depending on how they use that cash that’s freed up, that could be beneficial to the rating.”

And:

In the past month, Miami Herald publisher McClatchy Co. put its dividend policy on review; GateHouse Media Inc., publisher of 97 dailies, suspended its payout; E.W. Scripps Co. declared a smaller dividend than it forecast before splitting off cable-TV channels; and Gannett Co., owner of USA Today, skipped its annual increase for the second time in 41 years.

Each saw a drop in newspaper advertising in the second quarter, following the industry’s 14 percent skid in the first.

I discussed GateHouse dividend cuts here.

The New York Times writes about how no one wants to buy newspaper companies anymore. Of course, GateHouse Media’s woes get a mention. But they saved the money paragraph for the last:

Despite the long-term challenges, analysts and bankers think that buyers will return to the newspaper market, though they may be outnumbered by people who decide to invest in online news start-ups instead.

It makes sense. Printing news on paper and hand-delivering it door to door strikes me as inefficient. And the free market is supposed to weed out the inefficient and replace them with those who can delivery the most goods for the least cost.

And THAT is one reason for the drop in value for newspaper companies. Why invest in the print media when the market is just waiting for the inevitable?

Of course, some newspaper companies have problems beyonde those that are common in the industry right now. GateHouse stock closed at 44 cents Friday. I have no idea how it will close today, but even if the stock doubles in value, it won’t be enough to keep it from being delisted.

At least if GateHouse enters bankruptcy, there’s one thing that won’t stand in the way of the Journal Star being sold in one piece: Debt from the paper’s new printing press. I had been worried that anyone who bought the PJS would also get stuck with the debt for the multi-million presses. I’ve been told by someone who should know that this isn’t the case.

Say what you will about Molly Ivins. Her politics may be lefty, but she has a way with a words. This often raises eyebrows. Back when she worked for the New York Times, once referred to some sort of chicken-defeathering event as a “gang pluck.” The bluenoses who ran the
NYT copy desk changed it. That mindset still exists.

Molly Ivins,gang pluck,New York Times

The San Francisco Chronicle takes New York Times Magazine to task for its glowing profile of Stanley “Tookie” Williams, a convicted four-time murderer who wrote a series of children’s books and has been nominated three times for the Nobel Peace Prize.

The story does report that Tookie and friends robbed a 7-Eleven store, and that “court records describe” how Tookie shot 26-year-old clerk Albert Owens in the back twice as Owens was lying face down on the floor. Two weeks later, during a motel robbery, Tookie shot dead proprietors Yen-I Yang and Tsai-Shai Yang, as well as their daughter Ye Chen Lin. Sevcik also reported that Tookie denies killing these four innocent people.

Here’s what the New York Times story didn’t tell you.

The story failed to mention that physical evidence tied Tookie to the crimes. Or that Tookie’s many appeals and evidentiary hearings failed to overturn the guilty verdict or sentence.

The story does not mention that Tookie’s latest appeal argued — not that he’s innocent — but that he suffered from organic brain damage, which made him mentally incompetent — either during trial or when he committed the crimes.

Hmmmm. Williams’ defense argues he suffered organic brain damage — and yet the New York Times reported, he reads up on black history, philosophy and world religion and co-wrote a series of books.

The reporter and the editors responsible for the NYT piece lack something that is unfortunately lacking throughout the business: A working bullshit detector.

Via Romenesko.

tookie williams,death penalty,san fencisco chronicle,new york times