In Buying Engadget, Verizon is Also Buying Its Editorial
Yesterday’s announcement that Verizon is buying AOL for $4.4 billion is still percolating through the blogosphere, but it has already generated quite a few editorials.
One in particular caught my eye. Michael Gorman, the editor-in-chief at Engadget, took to the blog to proclaim its editorial independence. He says that Engadget will not cater to Verizon’s demands:
In the time that I have been editor-in-chief, the Engadget team has done some incredible work to deliver on the editorial mission I laid out just over a year ago. And things are going according to plan. Engadget’s audience is larger than it’s ever been (thanks!), and we continue to grow thanks to the strength of our reporting. We will continue to tell the stories that give you the full picture of how technology is changing our world and affecting our lives. And yes, that includes coverage of some of Verizon’s not-so-favorite topics, like the Patriot Act, net neutrality and online privacy.
Of course, I understand the questions about Engadget’s ability to maintain its editorial integrity in the wake of this acquisition. After all, Verizon has done nothing to earn us any benefit of the doubt — quite the opposite, actually. But it doesn’t matter who pays our salaries; we’re not in the business of censorship. Engadget’s editorial isn’t for sale. It never has been, and it never will be. Not as long as I and Executive Editor Christopher Trout are running things. Actions speak louder than words, however, and it’s time to get back to work. Stick around, I promise you won’t want to miss what’s next.
Those are pretty words, but the words that really matter here are the ones printed on the check. And the fact of the matter is, Verizon is going to be signing the checks from now on.
So yes, Verizon has bought Engadget’s editorial, which means they could follow NewsCorp’s lead and use Engadget as an official mouthpiece the way NewsCorp uses the Wall Street Journal.
And given Verizon’s history, I would not be surprised if that happens.
As I pointed out yesterday, Verizon has previously dabbled in owning a tech blog, only it didn’t end well. Last fall Verizon started a blog called SugarString, and then proceeded to make the name ironic by limiting coverage of key issues including net neutrality or government surveillance to only the most saccharine of coverage:
Verizon is getting into the news business. What could go wrong?
The most-valuable, second-richest telecommunications company in the world is bankrolling a technology news site called SugarString.com. The publication, which is now hiring its first full-time editors and reporters, is meant to rival major tech websites like Wired and the Verge while bringing in a potentially giant mainstream audience to beat those competitors at their own game.There’s just one catch: In exchange for the major corporate backing, tech reporters at SugarString are expressly forbidden from writing about American spying or net neutrality around the world, two of the biggest issues in tech and politics today.
Verizon shut down SugarString after heated criticism from media pundits, but that doesn’t change the fact that Verizon exerted editorial control over its tech blog.
Are you really so sure that they won’t try the same trick with Engadget, TUAW, and The Huffington Post?
I can’t estimate the probability, but I’m also not willing to dismiss it out of hand.
Luckily for us there is a way out. Re/code and other sources reported yesterday that Verizon is looking to sell The Huffington Post.
The talks have been most serious with Axel Springer, the German media conglomerate, but a number of private equity firms have also expressed interest in the high-profile property. Sources said the Huffington Post has been valued at above $1 billion in this scenario, which would either be a complete sale or, more likely, structured as a joint venture.
We don’t know at this time whether Verizon wants to sell the entire blog group or just the one site, but I bet it’s the former. Someone at Verizon clued in on the point that they could be criticized for how the blogs cover certain topics even if Verizon never interferes.
Selling off the blogs would remove the chance of negative publicity entirely (this is why I don’t fully believe re/code’s report), and Verizon would be a fool not to go ahead with any reasonable offer.
image by Robert Scoble,
Paul May 13, 2015 um 1:06 pm
They will eventually sell for around the $100-200 million mark and keep something like a 30% stake in the property. Even with all the work they do, these platforms are still losing money.
Nate Hoffelder May 13, 2015 um 1:29 pm
The blogs did generate 8 million in profit last quarter. That’s not nothing. It’s very little and definitely not worth the headache to Verizon, but it’s not nothing.
Still, Verizon would be better off owning the pipes over which the content is sent rather than the content itself. There’s more money in transmission than creation.
Sell the blogs, I say.
Paul May 13, 2015 um 1:31 pm
$8 million profit isn’t worth $1 bn purchase price.
Nate Hoffelder May 13, 2015 um 1:40 pm
This is very true, but it doesn’t mean that they won’t claim that laughably high valuation. It’s only 3 times what AOL paid for Huffington Post.
Paul May 13, 2015 um 1:42 pm
You still need a "like" button on this web site 🙂
puzzled May 13, 2015 um 5:09 pm
"Not as long as I and Executive Editor Christopher Trout are running things."
I’m sure that is easily arranged…
Will Entrekin May 14, 2015 um 8:08 am
I saw this yesterday and sighed. I remember when Engadget and Gizmodo were the two great tech sites. Heck, I remember Peter Rojas in the very earliest days.
But Engadget and its network has been consolidating a lot lately. They’ve folded both TUAW and Joystiq (their gaming blog) into the main site coverage.
I think I’ve been reading the Verge and Daring Fireball most often lately, plus Apple coverage at MacWorld. Otherwise the tech blogosphere is a shadow of its former self — and I hope it gets off my lawn soon!
Nate Hoffelder May 14, 2015 um 8:28 am
I don’t think Engadget ever really recovered from the walk out.
I think it was back in 2012, not too long after AOL bought Engadget, that half of the folks I wanted to read walked out en masse and proceeded to launch The Verge (and I agree, it is worth reading). That was a telling statement on AOL’s editorial influence, I think.