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How the Coronavirus Crisis Has Changed About Social Media

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In a crisis, social media can democratize information and help communities organize—but it’s vulnerable to the dishonest and the misinformed.Photograph by David Paul Morris / Bloomberg

Elon Musk is good at making electric cars, flamethrowers, and rocket ships; he is bad at making music, choosing friends, and forming opinions in real time. I know these latter, more personal facts about Musk because he has a Twitter account—one of the most popular accounts in the world, with more followers than CBS News, NBC News, and ABC News combined. In 2018, when twelve young soccer players were trapped in an underwater cave in Thailand, Musk, on Twitter, mused about building a rescue vessel. His help wasn’t needed, as it turned out, but he did take the opportunity to get into an ugly Twitter spat with a cave diver who was involved in the rescue. (For reasons too complicated to explain here, Musk ended up calling the diver a “pedo guy,” and the diver sued him, unsuccessfully, for defamation.) A month later, Musk tweeted, about one of his companies, “Am considering taking Tesla private at $420. Funding secured.” This was probably nothing more than a dumb joke—420, in extremely outdated slang, refers to marijuana—but the S.E.C. took it seriously, and the tweet resulted in Musk paying a fine of twenty million dollars, stepping down as chairman of the company, and agreeing to get preapproval from Tesla’s lawyers before tweeting anything similar again.

Another kind of person—especially a person with several companies to run and many billions of dollars to manage—might have taken any of these incidents as a perfectly good cue to delete his account. Yet here we are in the grip of a global pandemic, and Musk cannot help himself. Last week, he tweeted, “danger of panic still far exceeds danger of corona imo.” (The initialism is sometimes rendered “imho,” for “in my humble opinion,” but Musk is apparently self-aware enough to omit the “h.”) A few days later, one of Musk’s followers, a guy whose display name was “bill lee” followed by a smiling-pile-of-poop emoji, tweeted a link to an article called “Stanford Professor: Data Indicates We’re Severely Overreacting to Coronavirus.” The article was from the Daily Wire, a right-wing blog full of partisan clickbait. “Imo, this professor is correct,” Musk replied. In the meantime, he added, he would devote some of his factories’ capacity to building ventilators, “even though I think there will not be a shortage by the time we can make enough to matter.”

The professor in question was John P. A. Ioannidis, a well-regarded Stanford epidemiologist who is known for precisely this kind of bubble-bursting argument. (His most widely cited publication is called “Why Most Published Research Findings Are False.”) Despite the Daily Wire headline, though, Ioannidis wasn’t exactly arguing that we are overreacting to the virus. He was arguing that we may be overreacting, because we don’t yet have enough evidence to know whether our “draconian countermeasures” will do “more good than harm.” This much is clearly true. Until we’re able to test a broad sample of the population, for example, we won’t know whether the fatality rate from COVID-19 is closer to five per cent or to 0.05 per cent. It’s possible that we’ll look back in a few months and agree that the worst part about the coronavirus was our panicked response to it. We should be so lucky. For now, I would contend that we have no choice but to act decisively, even without complete evidence.

So far, this might seem like an anecdote about the Internet as a basically functional marketplace of ideas. Professor writes provocative analysis (for STAT, an online publication about the life sciences); extremely online industrialist amplifies said analysis (or, at least, a tweet-size synopsis of it); and here I am, online, lodging my critique. What’s not to like? Steven Levy, in Wired, recently wondered whether the coronavirus would “kill the techlash”—whether Americans under lockdown, convening on Zoom and stocking home bars via Drizly and socializing distantly on Instagram Live, would start to feel less indignant about our Silicon Valley overlords and more grateful for all the nifty apps they’ve bestowed on us. But one problem with the concept of the techlash is that it’s always been about too many things at once: surveillance capitalism, anticompetitive practices, phone addiction, Mark Zuckerberg’s uncanny-valley smile. It’s possible to ameliorate one of these problems without broaching the others. Facebook can be the death knell of consumer privacy and also a fun place to share baby photos. Amazon can be a rapacious monopoly and also the most reliable way to get light bulbs in a time of crisis. Twitter can keep us informed (and anxious) about the pandemic, but this doesn’t obviate concerns about its long-term effects on our public discourse.

After asserting that Ioannidis “is correct,” Musk shared his reasoning: “growth rate of confirmed C19 cases is dropping every day,” he tweeted, linking to a bar graph on a C.D.C. site that he thought corroborated this view. In another tweet, Musk predicted that there would be “close to zero new cases in US too by end of April.” A Twitter user called Hopeful Pope of Muskanity, referring to Musk as “my liege,” asked whether this would happen essentially by magic, in the absence of social distancing and other public-health measures. Musk replied, “Kids are essentially immune.”

These claims are wrong, and dangerously so. Most children with COVID-19 do seem to experience milder symptoms than adults—but “most” is not “all,” and, besides, a metascientist like Ioannidis would caution us against clinging too dogmatically to this preliminary finding, or to any finding, about what is still a novel virus. What we do know is that children can get infected with the virus, and can pass it on to others, which makes them, in the most relevant sense of the word, very much not immune. The C.D.C. bar graph that Musk linked to did seem to imply that cases were dropping—but only if you squinted at the graph without bothering to read the words hovering above it, in large type: “Illnesses that began during this time may not yet be reported.” One portion of the graph, helpfully shaded gray, clarified that “this time” referred to the most recent stretch of six days—the very days in which cases appeared, misleadingly, to have gone down. As far as anyone can tell, and as dozens of less muddled bar graphs attest, American cases of COVID-19 are trending exponentially upward.

I don’t mean to imply that Elon Musk is the main problem. There have always been tycoons and celebrities with bad opinions; if this crisis teaches us to pay less attention to them, at least during public-health emergencies, so much the better. And if Musk does end up helping to stave off a shortfall of ventilators, the people whose lives he saves will owe him an incalculable debt of gratitude, and will not particularly care about his shoddy reasoning. Still, Musk is a useful case study, because his combination of characteristics—blithe self-assurance, poor reading comprehension, a proclivity toward the contrarian and controversial, and an apparent willingness to spend ten minutes boning up on a new topic before explaining it to the world—are hardly unique. Rather, they are precisely the characteristics that make him, in a phrase that should only be used in scare quotes, “good at Twitter.”

In 2018, Jack Dorsey, the C.E.O. of Twitter, vowed that the company would work to “increase the collective health, openness, and civility of public conversation.” (Dorsey, unlike Paul Elie, does not seem to have brushed up on his Sontag recently; he uses the metaphor of “conversational health” almost as a mantra.) Since then, the company has made modest improvements. Harassment, threats, and bots are still rampant on the platform, although their proportions seem to have diminished. But, in this backlash-to-the-techlash moment, Twitter has been enjoying a rare bit of good press. The pandemic, Ben Smith argued in the Times, is showing that “Twitter, Facebook, YouTube and others can actually deliver on their old promise to democratize information and organize communities, and on their newer promise to drain the toxic information swamp.” Dorsey, in a direct message to Smith, wrote, “Public conversation can help the world learn faster, solve problems better and realize we’re all in this together.”

In the run-up to the 2016 election, social media was more or less overrun by junk. In the current crisis, social-media companies have been more proactive about preventing the most overt liars and chaos agents—financial scammers, Russian spies, the President of the United States—from monopolizing their platforms. And yet this is where the distinction between disinformation and misinformation, which might normally seem pedantic, becomes relevant. Disinformation means intentional deception (for example, the false insinuation that the coronavirus was created in a Chinese lab). Misinformation is a broader category. Some of it is intentional; some of it isn’t. When social-media executives are asked what they’re doing to combat misinformation, they often respond by describing what they’re doing to combat disinformation, because disinformation lends itself to simpler, sharper answers. But most people who spread misinformation on social media are not Macedonian teen-agers hoping for a quick payday or Iranian spies trying to meddle in a foreign election. Most people spread misinformation because they are misinformed. This is a much broader problem, and the solution to it, if there is one, is far less obvious. In February, the World Health Organization took to Twitter to debunk a few urban legends (“there is no evidence from the current outbreak that eating garlic has protected people from 2019-nCoV”; “Sesame oil is delicious but it does not kill 2019-nCoV”). Earlier this month, Twitter announced that it would take down tweets containing “denial of established scientific facts about transmission . . . such as ‘COVID-19 does not infect children because we haven’t seen any cases of children being sick.’ ” But, when Elon Musk tweeted almost exactly these words, Twitter reviewed the tweet and decided that it “does not break our rules.”

Some would argue that the solution here is simple: more aggressive enforcement. Find all the bad tweets and remove them; repeat until all the bad tweeters are gone. But this can’t be the whole solution. Enforcement is necessary, but it’s not sufficient. Banning the worst of the worst is a relatively easy call, but many of the less egregiously bad tweets—tweets that do not appear to violate any of the platform’s rules but nonetheless sow unnecessary fear, or exacerbate distrust, or cause confusion regarding matters of life and death—come from people who are merely trying to be “good at Twitter.” Social media was always designed to give us what we want, not what we need. For years, it has incentivized controversy, outrage, and half-baked contrarianism. Now its administrators are starting (inconsistently, half-heartedly) to punish some of the people who have correctly internalized those incentives. This is better than nothing, and it may be cause for one or two celebratory news cycles, but the problem is too systemic to be reversed overnight. A bad tweet, morally speaking, is often a good tweet, judging strictly by the numbers. We will not wake up tomorrow and find that all the bad tweets are gone. In the short term, at least, all we can do is flatten the curve.

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Four Ontario school boards sue social-media giants for products that harm students' behaviour and education – The Globe and Mail

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Colleen Russell Rawlins, Director of Education with the Toronto District School Board, talks to students at Selwyn Elementary School on Mar 27.Fred Lum/The Globe and Mail

Four of Canada’s largest school boards are suing the companies behind social-media platforms Facebook, Instagram, SnapChat and TikTok, accusing them of negligently designing products that disrupt learning and rewire student behaviour while leaving educators to manage the fallout.

In four separate statements of claim filed on Wednesday in Ontario’s Superior Court of Justice, the Toronto District School Board, the Toronto Catholic District School Board, the Ottawa-Carleton District School Board and the Peel District School Board accused social-media companies of employing “exploitative business practices” and choosing to “maximize profits” at the expense of the mental health and well-being of students.

The addictive nature of social media means that educators spend more classroom time trying to have students focus on their lessons, the boards say in the statements of claim. They say the compulsive use of social-media platforms has also strained limited school board resources: Schools require additional mental health programs and personnel; staff spend more time addressing aggressive behaviour and incidents of cyberbullying; and information-technology services and cybersecurity costs have increased.

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“The Defendants have acted in a high-handed, reckless, malicious, and reprehensible manner without due regard for the well-being of the student population and the education system,” according to the statements of claim.

Similar lawsuits against social-media companies have been filed in the United States in recent months by individual states and school districts. This would mark the first time it’s being done by school boards in Canada.

The four boards filed their lawsuits against Meta Platforms Inc., which is responsible for Facebook and Instagram, Snap Inc., the parent company of SnapChat, and ByteDance Ltd., owner of TikTok.

The school boards are advancing combined claims of around $4.5-billion. They are also asking that the social-media giants redesign their products to keep students safe.

None of the allegations have been proven in court.

In an e-mailed statement, Tonya Johnson, a spokeswoman for Snap, said the platform was “intentionally designed to be different from traditional social-media” so that users could communicate with friends. “While we will always have more work to do, we feel good about the role Snapchat plays in helping close friends feel connected, happy and prepared as they face the many challenges of adolescence,” she stated.

Meta and ByteDance did not immediately respond to requests for comment.

Social-media use by children and young people has been the topic of widespread discussion among parents, policymakers and educators. Earlier this week, Florida Governor Ron DeSantis signed a bill that bans social-media accounts for children under 14 and requires parental permission for 14- and 15-year-olds.

In Canada and elsewhere, there are growing concerns over the role social-media platforms play in cyberbullying, disrupted sleep patterns, brain development, and the inability of young people to focus.

A survey from the Centre for Addiction and Mental Health in 2021 found that 91 per cent of students in Grades 7 to 12 use social media daily, and about a third spend five hours or more daily on it. Researchers surveyed more than 2,000 Ontario students. Almost one-third reported being cyber-bullied at least once in the past year.

In their lawsuits, the four school boards said the companies “knew, or ought to have known, that the deliberate design of addictive and defective social-media products would interfere with students’ access to an education, negatively impact the learning environment, and create a public nuisance within the education system.”

Colleen Russell-Rawlins, education director of the Toronto District School Board, the country’s largest school board, said in an interview on Wednesday that social media has affected the education system in “very significant ways.”

“Students are not present,” she said, describing the addictive nature of social-media platforms. Educators are hearing about more incidents of cyberbullying. They are witnessing the rapid escalation of aggression that starts online. And they are helping students who are coping with anxiety and other mental health challenges.

The lawsuits, she said, are not just about raising awareness, but about protecting children by calling for safeguards and ensuring that school boards have the resources to help address the negative effects of increased social-media use.

“I think there’s no other childhood addiction that’s impacting children’s futures through education that we as educators and leaders would be expected to remain silent about. We feel compelled to act on behalf of our young people,” Ms. Russell-Rawlins said.

Pino Buffone, the education director at the Ottawa-Carleton District School Board, echoed the sentiment, adding that the compulsive use of social media has further strained the finite resources of the school board. Educators and other school staff are being forced to manage behaviour that stems from social-media use.

“It has become clear that we need to hold social-media giants accountable,” Mr. Buffone said.

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Is the US media layoffs phenomenon the next housing crisis?

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In the past few months, the media sector in the United States has gone through one of its worst rounds of layoffs in decades, with some voices within the sector even asking if journalism is a viable career path despite surging subscriptions at publications like The New York Times.

Most recently, outlets like Vice and the sports blog Deadspin were decimated in a massive round of job cuts. Vice ended its online publication, and Deadspin laid off its entire editorial team.

These are the latest in a slew of headcount reductions at countless newsrooms around the US over the past decade at the hands of wealthy owners. The latter overwhelming have the backing of some of the biggest private equity and wealth management firms in the US like Apollo Global Management, Fortress Investment Group and Alden Capital, to name a few. These institutions are also called shadow banks.

A surge in private equity investments in media, experts said, has led to decisions that benefit investors but not always the companies and their employees, similar to the 2008 housing crisis and private equity’s ability to flourish during that time.

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While the media business is in the spotlight now, it is a microcosm of a bigger challenge across the US economy. What makes it stand out is that it’s been a long and high-profile battle.

One such moment came with tech’s control (overwhelmingly led by Meta, then Facebook) in 2018 over audience traffic, which made newspapers, magazines and news portals beholden to the algorithmic choices of social media giants like Facebook and Twitter, which ultimately hurt the sector.

That was an optimal entry point for private equity to get a stronger foothold in the media business.

“Media companies were struggling at the time but not nearly enough as the journalism community was led to believe,” explained Margot Susca, the author of How Private Investment Funds Helped Destroy American Newspapers and Undermine Democracy.

“Funds use these market conditions to justify the gutting of these American institutions,” said Susca, who is also a professor of journalism at American University in Washington, DC.

‘Liquidating the entire industry for profit’

Like in the housing market, financial institutions capitalised on someone else’s misfortune to make money from it. In the 2008 recession, it was lenders and big investment banks ranging from Lehman Brothers to Washington Mutual, a move that ultimately led to their collapse.

The key is real estate. In the housing crisis, banks seized foreclosed homes for pennies on the dollar after homeowners defaulted on subprime mortgages.

In the case of the media sector, shadow banks are going after physical newsrooms and selling them. For instance, in 2018, Gannett sold the headquarters of the Asheville Citizen Times to Twenty Lakes Holdings, a real-estate affiliate of Alden Capital. Gannett sold the building for $3.2m. Alden then sold it to developers for $5.3m.

A comparable move happened at Vice last year. Only months after Fortress Investment Group acquired the publication, it left its office in Brooklyn, New York.

There’s a lot of real estate at shadow banks’ disposal. Private equity, hedge funds and other comparable firms control roughly half of all daily newspapers in the US.

“The problem with the news media sector is not its viability. The problem with the news media sector are these locust funds that are liquidating the entire industry for profit,” Susca said.

But where do shadow banks go once physical assets like real estate have been liquidated?

They squeeze out revenue where they can for as long as they can. That often means cutting staff.

G/O Media, formerly known as Gizmodo Media Group, sold off Deadspin, its sports blog. The new owner, Lineup Publishing, said it would not bring over any existing editorial staffers even though it aimed to “be reverential to Deadspin’s unique voice”, G/O CEO Jim Spanfeller said in an email to employees.

Great Hill Partners acquired the media brand in 2019 and drastically shifted Deadspin’s editorial vision. The publication was a sports-centric one that also housed vibrant cultural commentary on a variety of topics. At the direction of the new owner, the publication was directed to “stick to sports”. The announcement led to mass resignations.

This week, G/O Media sold two more publications from its portfolio — The AV Club and The Takeout.

G/O is not in a financially dire position, according to Spanfeller, who told Axios this year, “We’re not strapped for cash.”

Unionized staff at Condé Nast walk the picket line during a 24-hour walk out amid layoff announcements
Unionised staff at US publishing company Conde Nast walk the picket line during a 24-hour walkout amid layoff announcements in New York City in January [File: Angela Weiss/AFP]

According to the Writers Guild of America East, which includes various unions representing editorial staff from multiple media firms, Great Hill Partners made an estimated $44m in revenue in 2023. The guild suggests that Great Hill Partners has enough money to make decisions that do not undermine the financial security of its staffers.

When Spanfeller was appointed in 2019, the private equity firm said he was a significant investor in the company but did not disclose the specifics of the financial agreement. Spanfeller’s appointment came directly from the firm suggesting that it intended to oversee day-to-day editorial operations across G/O’s portfolio.

Great Hill Partners did not respond to Al Jazeera’s request for comment.

G/O is the latest in a string of companies laying off workers in the last few months alone.

Last month, Engadget, a brand owned by Yahoo, had a series of layoffs including of high-profile editors. It came amid a reported refocus on traffic growth. But how can you drive more traffic with high-quality reporting with fewer people to make the product?

Meanwhile, Apollo Global Management, which now owns Yahoo, is doing very well. The asset management firm’s stock is up nearly 250 percent over a roughly five-year period – 80 percent this past year alone. The firm acquired Yahoo in 2021 and also has a significant stake in several other large media companies, including Gannett, which owns hundreds of newspapers around the US, including USA Today, the fifth largest. In 2019, Apollo provided $1.8bn to finance the acquisition of the newspaper giant and merge it with GateHouse Media.

‘Layoffs were the core strategy’

Once Gannett’s acquisition of GateHouse was complete, it scrapped hundreds of jobs immediately. In 2022, the newspaper group slashed roughly 600 more jobs in two rounds of cuts in August and November.

Apollo also acquired both Northwest Broadcasting and Cox Media Group, which included 54 radio stations, and 33 TV stations.

“After funds became owners, layoffs were the core strategy to try to maximise revenue. [These are] firms that just had profit as the sole motivation,” Susca said. “Layoffs are the stark reality of hedge fund ownership and private equity investment.”

Historically, private equity firm involvement has led to layoffs – an average of 4.4 percent of job losses in two years as well as a 1.7 percent decrease in pay, according to a study from the University of Chicago.

That is what happened at Cox Media Group. Almost immediately after its acquisition, talent from local TV and radio stations across the country was laid off.

Apollo Management did not respond to Al Jazeera’s request for comment.

New York-based Alden Capital operates a similar job-cutting strategy and is one of the most infamous hedge funds in the sector for decimating a number of newspapers around the country.

In 2020, Vanity Fair referred to the firm as the “grim reaper of American newspapers”.

Vanity Fair’s stern critique is because of the massive slate of layoffs at the papers Alden Capital owns, including the Denver Post, even as one of the company’s executives said “advertising revenue has been significantly better”, according to reporting from Bloomberg in 2018.

Alden bought Tribune Publishing and gutted many of its newsrooms. At the time, Tribune was profitable, but Alden still moved forward to strip down its papers to make more profits.

Alden often pushed to beef up subscriptions even after shedding physical assets like office space and social assets like its people, which, Tim Franklin, senior associate dean at Northwestern University Medill School of Journalism, suggests is a losing strategy.

“It’s like charging for 16 ounces of Coca-Cola and putting it in a 12-ounce bottle. You’re giving people less and then expecting people to pay. The problem is that you end up in this doom loop. You’re getting less digital subscription revenue because you are providing less content, so then you make cuts and then you see even less revenue and you make more cuts. It’s this never-ending cycle of rinse and repeat,” Franklin said.

Alden Capital did not respond to Al Jazeera’s request for comment.

Doomed to failure

Shadow banks and big banks have made risky investments and hoped they would work out financially.

They sold the idea that someone could very well make payments on a subprime mortgage. Now, the idea is that a media company can create quality reporting on a shoestring budget and a fraction of its headcount. But those are unrealistic expectations and doomed for failure.

During the 2008 housing crisis, big banks essentially created an insurance plan for themselves: sell the debt and make money off the interest. Now private equity is employing a comparable strategy for media.

In the housing crisis, the banks bundled the mortgage loans in a package and sold them to the bond market to random investors. The banks had protections. If a lender defaults, they sell the debt on the secondary market for a profit. The strategy was to bet on the homeowners who were most likely not going to be able to afford the mortgage payments. But ultimately, that backfired, and the resultant housing crisis has been well documented.

“The only people there [who] were able to buy homes at the point could do so with cash or with Wall Street financing because that cash was still flowing,” said Aaron Glantz, author of Homewreckers: How a Gang of Wall Street Kingpins, Hedge Fund Magnates, Crooked Banks, and Vulture Capitalists Suckered Millions Out of Their Homes and Demolished the American Dream.

“Private equity is not depending on that credit system,” Glatz added.

A view of a sign for NBC News at Rockefeller Center in New York
NBC and MSNBC laid off employees [File: Justin Lane/EPA]

In either situation, the protections afforded investors were not passed down to homeowners in 2008 or writers, editors, on-air talent and others in the media industry now.

While some savings and lending banks failed and were the recipients of massive bailouts, shadow banks flourished. Generally speaking, these companies make money during times of economic vulnerability, leading to an even more challenging situation for average people.

In the wake of the 2008 financial crisis, funds were largely criticised for buying up distressed housing across New York City and forcing out longtime residents – a move that brought rent-stabilised properties to market rate, which ultimately allowed them to drive up prices on their buildings and raise the value of the buildings around them.

“They’re reliant on cash that is just sitting around ready to be spent or credit lines that they can get from banks like JPMorgan Chase or they can leverage other assets. They own so many other assets,” Glatz said.

One of those assets over the past decade is a growing number of media companies.

But even then, it poses the question: If all these media companies are struggling, why are their executives so wealthy?

Behind a number of these mass layoffs are uber-wealthy executives. That’s the case for Business Insider, The Washington Post and Vice, just to name a few.

In January, Business Insider, owned by the German media giant Axel Springer, laid off 8 percent of its workforce. Axel Springer, however, is doing well financially. Its CEO, Mathias Doepfner, has a net worth of $1.2bn.

Executives on both the editorial and business side at the short-lived outlet The Messenger raked in close to million-dollar salaries. Meanwhile, editorial staffers launched a crowdfunding campaign to make ends meet because the outlet did not give them any severance packages.

NBC and MSNBC laid off 75 people this year. Brian Roberts, the CEO of NBC’s parent company, Comcast, raked in more than $32m in 2022.

Despite the recent layoffs, the network hired former Republican National Committee Chairwoman Ronna McDaniel as a contributor. Hiring McDaniel was met with swift backlash from high-profile talent across the news organisation and the NBC News Guild, the union representing journalists across the network.

The union in particular pointed out that McDaniel – who was known for helping to enable former President Donald Trump’s baseless claims that the 2020 presidential election was rigged – was hired after the company laid off more than a dozen unionised journalists. Amid the backlash, NBC cut its ties with McDaniel.

NBC is just the latest major network to make job cuts. At CBS, despite its high viewership during American football’s Super Bowl, parent company Paramount laid off staffers the following day at CBS News. Meanwhile, CEO Bob Bakish made $32m in 2022.

In November, Conde Nast laid off 5 percent of its workforce. The Newhouse family, which leads Advance Publications, the parent company of the magazine giant, has a net worth of $24.1bn, according to Forbes.

A VICE Media Group location
Vice Media, which was once valued at close to $6bn, has since filed for bankruptcy and ended publishing on its website [File: Eric Thayer/Getty Images/AFP]

In recent weeks, Vice laid off hundreds of employees and ended publishing on its website. It has been plagued with a nearly endless series of layoffs in the past few years. Prior to filing for Chapter 11 bankruptcy last year, the media company paid its executives roughly $11m – even though its executives were notoriously known for mismanagement.

Yet they were bailed out. Amid the Chapter 11 filing, Fortress Investment Group acquired Vice – a company that was once valued at $5.7bn – for $225m. Executives left with hefty paycheques while staffers were left jobless with little notice.

Fortress did not respond to Al Jazeera’s request for comment.

The Washington Post eliminated 240 jobs, yet it is owned by Jeff Bezos, the founder of Amazon, who is worth more than $200bn, according to the Bloomberg Billionaires Index, making him the second-richest person in the world.

In 2019, Senator Sherrod Brown sent a stern letter to Alden Capital, pressing the fund not to buy Gannett. Brown was unsuccessful.

In 2021, Brown, alongside Senators Tammy Baldwin and Elizabeth Warren, introduced the Stop Wall Street Looting Act, which would have reformed the private equity industry.

The bill never made it past committee, so it never had a vote in the full Senate.

Experts believe that Washington has not done nearly enough to curb the power of private equity.

“You have a government system, a regulatory, legislative system that has basically failed at every turn to stop the growth of these hedge funds,” Susca said. “And private equity firms in the journalism market, to me, is an institutional failure.”

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Trump Media, Reddit surge despite questionable profit prospects, taking on the ‘meme stock’ mantle

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NEW YORK (AP) — Reddit and Trump Media are the first notable social media companies to begin trading publicly in the last five years. They’re also, thanks to the rabid reception among investors coupled with the companies’ fuzzy profit outlooks, the latest meme stocks.

Meme stocks are typically shares in companies whose underlying business fails to justify a surge in their price. The action is often driven by small investors who for some reason pile into a stock, be it belief that a struggling company can turn itself around, a disdain for so-called short sellers — or fidelity to a former president. Or simply opportunism.

Reddit’s initial public offering last week was the most anticipated debut so far this year, and it didn’t disappoint, rising 48% on the first day. The stock gained an additional 30% Monday.

Then Trump Media stole Reddit’s thunder by jumping as much as 59% on its first day of trading Tuesday, before cooling off and closing with a gain of 16%. On Wednesday, the stock gained an additional 14% to close at $66.22. Former President Donald Trump holds a majority stake in Trump Media that could bring him billions.

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Analysts and academics are comparing the surge in Reddit and Trump Media to the meme stock craze in 2021 that boosted shares of companies such as video game retailer GameStop and movie theater operator AMC Entertainment. Although there are differences between the two groups, the companies did have two prominent similarities: It was hard to look at the financials and predict a path to long-term profitability. But small investors bought in nonetheless.

Trump Media lost $49 million in the first nine months of last year, when it took in just $3.4 million in revenue and had to pay $37.7 million in interest expenses. In a recent regulatory filing, the company said it will lose money “for the foreseeable future.”

Research firm Similarweb estimates that Truth Social had roughly 5 million monthly visits in February of this year. By comparison, Facebook had 15.2 billion visits, while Reddit had 2 billion.

Reddit, like its social media peers, relies on user growth and advertising revenue, but it has yet to turn a profit in its nearly 20-year history that has also been beset by management turmoil and user backlashes. About 76 million users checked into one of Reddit’s roughly 100,000 communities in December, according to a regulatory disclosure.

While Reddit and Trump Media can be considered newer technology companies, GameStop and AMC were considered to be somewhat antiquated when small investors latched onto them in late 2020 and early 2021. GameStop struggled while selling video games and consoles in stores without a digital alternative, and AMC lost billions of dollars as movie fans embraced streaming and the pandemic kept them out of theaters.

Granted, GameStop had the backing of Ryan Cohen, founder of the e-commerce pet food company Chewy, who investors likely thought could modernize GameStop’s business. But a number of investors were individuals who belonged to the Reddit community Wall Street Bets and bought shares in order to “stick it to” to big institutions that had made bets the stock would drop. As the stock took off, even more investors seized the opportunity to buy.

Many of those investing in Trump Media are also small-time investors either trying to support Trump or aiming to cash in on the mania. They helped the stock of Digital World Acquisition more than double this year ahead of its merger with Trump Media, which took its place on the Nasdaq stock market. As the stock jumped Tuesday, one user urged conservatives to “get behind the DJT stock and send it over $100 per share” to “drive the liberals insane!”

Data from Vanda Research show that retail investors bought $6.5 million of Trump Media shares on its first trading day and $7.9 million of Reddit shares for its debut.

The frenzy surrounding GameStop and AMC eventually died down. GameStop’s market value peaked above $20 billion in January 2021; it’s now just above $4 billion after Cohen’s turnaround has for the most part failed to materialize. AMC’s market value has dropped from a high of around $29 billion to about $1.5 billion. While both carry on — GameStop even reported a small profit for the fiscal year ended in January — analysts question their longevity.

Following the release of GameStop’s earnings report Tuesday, Michael Pachter, an analyst at Wedbush Securities, wrote in a note to investors that steeper revenue declines for the company could lead to large losses and possibly bankruptcy.

“If we’re right, GameStop has a likely runway of no more than five years,” Pachter said.

Even so, Pachter is even more skeptical of the fervor over Trump Media in the market. He notes that GameStop had revenue of more than $5 billion back in 2020 while Trump Media’s revenue is under $5 million.

“GameStop was the meme stock of a lifetime, but Trump Media has put it to shame,” Pachter said in an email.

The Associated Press

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