Member Newsletter
In a clearly choreographed series of announcements over the course of late last week, one tech CEO after another announced they were contributing $1 million to the Trump inaugural committee. This comes after the earlier endorsement controversies at The Washington Post and The Los Angeles Times. Then over the weekend ABC News agreed to give Trump $16 million and issue him a personal apology to settle his ongoing defamation suit. The critical factor here is that the suit — over George Stephanopoulos’ use of the term “rape” to describe the E. Jean Carroll jury’s finding against Trump — is not only almost impossible to win under current First Amendment law but over claims that are affirmatively accurate, as no less than the judge in the case confirmed.
Someone asked me over the weekend why I thought ABC settled the case on such adverse terms. Were they trying to prevent embarrassing facts coming out in discovery? I told this person that while I didn’t know specifically and couldn’t categorically rule that out, I was nearly certain that wasn’t true. The story here is basically identical to the $1 million initiation fees from the tech executives. Trump makes clear that he’ll make trouble for anyone who doesn’t make nice and let him wet his beak. For a comparatively small sum, you can make a start at being part of his club. Yes, ABC paid a bit more. But these are still small sums for a big diversified national or international corporation. (Disney’s market cap is just over $200 billion.) The answer, I am almost certain, is that the specifics of the lawsuit became irrelevant. Given Disney’s specific situation, the price of the initiation fee was $16 million. So they paid it. No big corporation wants to start Trump 2.0 on Trump’s bad side. It’s as simple as that.
In a way, the news dimension of this is almost a distraction from the perspective of the parties to these deals. And that’s the point. That’s the significance. Let’s return to a fact we’ve discussed already a number of times. Almost all the big legacy news organizations are owned by big corporations not principally interested in or profiting from news: ABC, CNN, NBC, MSNBC, The Washington Post, The Los Angeles Times. This is secondarily the case with Meta/Facebook, Google/Youtube — all of big tech. The latter don’t own major media organizations directly. But for reasons we all understand, they have a massive influence and control over the news economy.
Ironically, the one big, big player which is heavily bound up in the business of news as a central profit source is the Fox/Murdoch empire through its ownership of Fox News, The Wall Street Journal and all its other news and cable properties. Their interests are completely different since cozying up to Trump is mainly a profit driver rather than a liability. And in any case, unlike Comcast or Amazon or Disney, the Murdochs clearly have a commitment to right-wing politics that is independent of, though it doesn’t entirely trump, business interests.
The key here is that it is almost absurd to expect that these big diversified corporations are going to operate in the interests of or run major risks on behalf of their very small news divisions. These are in almost every case liabilities in the context of a Trump administration.
Let’s take ABC. We say, “ABC knuckled under to Trump.” But let’s step back to properly label the players. There’s no ABC here. We’re really talking about ABC News, which is a division of ABC. And ABC is owned by the Disney Corporation, which is an entertainment company which owns production studios, a big IP back catalog for streaming, and amusement parks. Relative to Amazon or Comcast or WarnerBros Discovery, Disney seems to have relatively less exposure to government harassment. But it still has no interest in being on Trump’s shit list.
The big point is simple: it’s crazy to expect any news organization owned by a big diversified corporation to be able to get significantly on the Trump administration’s shit list. This is very straightforward. These corporations are going to be ready to battle against the administration over their core interests — they’ll prefer to do that privately and through lobbying and giving but they’ll be ready to do it openly too if needs be. But they’re not going to pick fights over a small division which is probably in decline or actively losing money.
I’m not saying they will be going full Sinclair Broadcasting. But none of them are going to be straying far from the pack and the pack will be much less willing to get Trump mad.
I’ve heard from others who say that all the talk of “knuckling under” is a sort of false drama based on bogus assumptions. The reality, these folks say, is that these billionaire owners are actually mostly aligned with Trump in the interests of the oligarch class and they have been all along. That’s half accurate and half lefty claptrap. But it’s mostly irrelevant to what’s going on here. These are profit-driven corporations who mostly don’t think their core profit centers are endangered by Trump (probably right) and are accommodating different rules of the road of new national leadership. None of them are news businesses.
Note that the one agenda-setting organization we haven’t talked about here is The New York Times. I have endless problems with the Times, which I’ve discussed. But the Times ownership basically just owns the Times. They may make crappy editorial decisions I disagree with. But I think they come to them honestly, for better or worse.
There’s a whole narrative about not treating news like a business. Or that it didn’t used to be treated like a business. That’s almost completely false. If anything, in the past it was treated even more like a business, or it had much less of the layer of professionalization that is a product of the post-war era and post-Watergate mythification. TV news divisions were always different in the sense that they were mostly prestige loss-leaders for the business of the TV networks. But loss-leaders are very much business propositions even though they don’t need to turn a profit.
But I digress.
It’s not realistic to expect any news organization to be meaningfully independent in a Trump context if they’re owned by a company that is heavily involved in government contracting (Amazon) or in a business heavily exposed to government regulation (Amazon, Comcast, WBD, and all the rest).
The history here is important to consider. For most of our history newspapers were the dominant driver of news. Running a newspaper meant operating in a relatively unregulated space (no broadcast licenses, O&O’s, spectrum regulation) and just as importantly the rich families who owned them tended to have their economic roots and power in particular cities or regions. They mostly weren’t national. We can get into the complexities. But the particular overlap of political and regulatory power and news production that we’re describing here is fairly novel. Obviously, the game changer is a president ready and eager to abuse his power. But the ability to abuse it is also much greater.
The takeaway is pretty simple. We will have to rely on news organizations that are owned by companies that are really in the news business, and mostly not in other ones. I also think this will likely accelerate the decline of a decent amount of legacy media. That’s not because the great majority of news consumers are going to stampede away from ABC or CBS or CNN or any of the others for not standing up to Trump. But it will be brand damaging over time. And they’re in serious decline in the first place. If there’s a future for the cable networks and other legacy media entities it will probably be as more independent entities anyway. Not because of some resistancy turn in their editorial outlook. It’s simply because it’s very, very hard to imagine any big corporation wanting to buy a news organization in the current climate — both the economic climate and also the political one.