Updated 2:59 p.m., Tuesday Sept. 6
Things have gone from bad to worse at TechCrunch.
It was bad enough that TechCrunch founder and editor Michael Arrington was reported to be stepping down to lead a $20 million tech-startup venture capital fund, the CrunchFund, raising questions over potential conflicts-of-interest between TechCrunch’s ongoing coverage of tech startups that may or may not receive funding from the CrunchFund.
But now, TechCrunch has all-but declared war on The New York Times over an error-ridden column that recalls the numerous previous occasions wherein TechCrunch writers have reviewed companies or products in which Arrington was an investor.
More critically, TechCrunch writers have been taking repeated pot-shots at their blog’s corporate parent AOL, with one, M.G. Siegler, openly stating on the website this morning that AOL’s decision on how to handle the fallout of the CrunchFund controversy will determine the fate of TechCrunch going forward.
The events mark the latest, and perhaps most high-profile struggle AOL has faced in trying to successfully turn around its business model to become a successful, next generation online media company.
As part of that transition, AOL purchased TechCrunch for a reported $30 million in September 2010 and The Huffington Post for a reported $300 million in February. AOL has also contributed a reported $10 million to Arrington’s CrunchFund.
Full disclosure: I worked for AOL News as a staff writer from January 2010 to November 2010.
On Sept. 4, The New York Times‘ media critic David Carr (no relation to Paul), published a lengthy critique of Arrington and TechCrunch’s relationship with the various start-ups covered by the website and invested in by Arrington under the headline “A Tech Blogger Who Leaps Over The Line.”
“When criticism followed, [Arrington] said he would fully disclose any conflicts, and besides, he never saw himself as a journalist anyway, even though he often broke news. AOL swallowed hard and said Mr. Arrington was free to do what he wanted. Thus emboldened, he spent the following months both investing and directing coverage,”
The Times’ Carr’s piece referenced recent articles written by TechCrunch writers including Siegler and TechCrunch’s noted AOL critic Paul Carr (no relation) to bolster his claims .
If there’s one thing the TechCrunch writers couldn’t, or wouldn’t stand, it was having their own words reflected back at them to support a critical view of the website they’ve labored to build.
And in a striking display of fierce loyalty to both their (old?) boss Arrington and the TechCrunch brand, they opened fire on The New York Times and AOL, vehemently arguing that TechCrunch has a fundamentally different editorial DNA than every other blog out there – that every TechCrunch writer enjoys strict autonomy and independence from Arrington – and that critics just grossly misunderstand, and thus mischaracterize, how the website runs.
As TechCrunch’s Paul Carr put it in a post this morning :
“Carr’s assumptions about TechCrunch are based on how just about every other newsroom in the world works…But TechCrunch is not an organization like that,”
Siegler took to his own personal blog to say much the same thing, writing on Monday:
“Journalists seem to think they can write about TechCrunch as if they’re looking in a mirror. That is to say, they think our operation runs in a similar manner to theirs and they use that as a jumping off point for misguided (but predictable) outrage. In reality, what they’re looking at when they look at TechCrunch is a crystal ball.”
He went on to characterize Arrington as a Hollywood movie don, writing “That’s why the notion of Mike [Arrington] switching titles is silly and hollow. If you’ve seen Martin Scorsese’s film Casino, it reminds me of casino boss Sam ‘Ace’ Rothstein (Robert De Niro) switching roles every few weeks to keep the gaming board off his ass. ”
Perhaps not the wisest comparison to draw when attempting to argue in favor of the editorial integrity of your website, but no matter, the comparison stands.
Siegler and TechCrunch’s Carr also pointed to the fact that there were several glaring factual errors in The Times’ Carr piece relating to the timeline of when TechCrunch covered a startup that Arrington had invested in and when it disclosed his investment. These have since been corrected.
Meanwhile, on Twitter, Arrington accused The Times of failing to disclose its investment in the Boston Red Sox whenever writing about the baseball team.
Today, the The Times‘ David Carr took to Twitter this morning to respond to the considerable backlash against his piece, writing “Worth noting that AOL, @ArIannahuf [Arianna Huffington] and @arrington [Michael Arrington] all had detailed list of ?’s from me on Friday and chose not to engage.”
And this morning, Siegler’s response to the whole ordeal appears to have taken more of a somber tenor, with the writer blasting AOL for pushing out Arrington and lamenting about having the editor’s spot taken over by a hand-picked AOL replacement:
“TechCrunch is on the precipice. As soon as tomorrow, Mike may be thrown out of the company he founded. Or he may not. No one knows. And if he is, he will be replaced by — well, again, no one knows. No one knows much of anything. Certainly no one at TechCrunch. This site is about to change forever and we’re in the total fucking dark…
It has almost been exactly one year since AOL acquired us. At the time, they promised not to interfere with the way we do things. For 11+ months, they’ve kept their word, and things have run beautifully from our end. Our business is one of the few sterling ornaments on their mantel. Now they may break their promise to us. And if that promise is broken, it will break TechCrunch.”
For what it’s worth, TechCrunch’s readers have mostly rallied around the blog, with commenters lamenting AOL’s interference in what they see as a forward-looking website formerly unencumbered by corporate influence and the more traditional journalistic ideals of refraining from investing in story subjects.
One of the main issues facing AOL at this point is the notion, first reported by Kara Swisher at All Things D, that Arrington’s CrunchFund would be attractive to investors precisely because he would have an ongoing relationship with TechCrunch.
But as The Business Insider quoted an AOL spokeseperson, “AOL is not comfortable with TechCrunch being used as an access point for deal flow.” The corporation has essentially tied itself into knots though, having already invested a reported $10 million in the CrunchFund.
We’ve reached out to AOL and The Huffington Post to inquire about how they plan to handle the situation next and will update when we receive a response.
Late update: Arrington has responded to the controversy with a post on (where else?) the front page of TechCrunch.
It’s a doozy: He throws down the gauntlet and demands that AOL either give TechCrunch full and complete editorial independence, including independence “of the Huffington Post,” or be sold back to its original shareholders. He says that if neither option is taken, or if “no other creative solution can be found,” he “cannot be a part of TechCrunch going forward.”
Unmentioned is the matter of the CrunchFund, which started this whole mess. How AOL decides to go forward with it (or not), in light of Arrington’s demands, remains an open question. We’ll update when more news breaks, or when AOL/Huffington Post get back to us.
