Feathers Ruffled at Wall St. Journal by 'Historic' Management Memo

Ever since Rupert Murdoch bought Dow Jones from the Bancroft family, staffers at The Wall Street Journal (NWS) have lived in fear of seeing their unique culture dismantled -- not unreasonably, given Murdoch's public critiques of the paper's long stories and its baroque editing process.

But perhaps nothing since the ouster of managing editor Marcus Brauchli almost a year ago has done so much to crystallize that fear as a memo sent last Thursday by Brauchli's successor, Robert Thomson. On the face of it, the memo was no different from any number of edicts issued by his predecessors: Thomson urged Journal reporters to contribute more breaking news to Dow Jones Newswires and previewed a new system that will facilitate their doing so.

But the memo's tone and its potentially far-reaching implications ensured it much scrutiny from anxious Journal employees, many of whom thought they detected in it the sound of a long-awaited second shoe dropping. "There was a historic-moment kind of feel about it," says one reporter.

That momentousness lay in Thomson's declaration of a "fundamental shift in orientation" within the newsroom. Pre-Murdoch, Journal reporters had a mandate to pursue the sort of in-depth, counter-intuitive and/or quirky stories that would result in the lengthy page-one articles known as "leders." Publishing leders was widely seen as the highest aim of the Journal writer.

But Thomson's memo outlined a newsroom whose occupants are constantly on the lookout not for leder-worthy ideas but for tiny news bites that can be pushed out over the wire immediately, there to bestow a momentary competitive advantage on subscribers.

"Even a headstart of a few seconds is priceless for a commodities trader or a bond dealer -- that same story can be repurposed for a range of different audiences, but its value diminishes with the passing of time," wrote Thomson. "Given that revenue reality, henceforth all Journal reporters will be judged, in significant part, by whether they break news for the Newswires."

Horrifying? More than a few longtime Journal veterans thought so:

"It's a pretty definitive statement to say that henceforth people will be significantly judged by the frequency with which they break news for bond traders," says the reporter. "That hasn't really been the mission of reporters here. It was to make sense of events for the lay reader, and to dig into stories and tell stories in a way that people would remember."

"It's depressing to a lot of people who have been there for a long time," says an ex-staffer who left recently. "Maybe there's a market for selling this shit to people who are creating trading algorithms, but there's nobody on the Journal's staff who wants to write that stuff. You didn't sign up to write 130-word squibs. You signed up to file 3,000-word mini-New Yorker stories for the front page."

Compounding the depression is a layer of confusion generated by Murdoch's talk about putting the Journal onto a footing where it can compete against The New York Times (NYT) on all fronts. "Now we're being told that our real competition isn't the Times -- it's Bloomberg and Reuters," (TRI) says the ex-staffer. "You're turning us all into wire reporters. It's all going to be nuggets written by scriveners who get 700 words to spread their wings." And people will put up with it, he says, because "there's no other place you can go if you want to stay in journalism."

(Some people are evidently willing to accept that trade-off: Two reporters in the Journal's Washington bureau, Glenn Simpson and Susan Schmidt, recently resigned to start their own investigations business. "I think it's safe to say that the industry is going through difficult times and it's not clear what the future of investigative journalism at newspapers is," said Simpson when I called him.)

It didn't help that the language of Thomson's memo was far from diplomatic. One source described it as "contemptuous" of the Journal and its ways; another highlighted the "sneering quality" of Thomson's words. One passage that caused particular alarm was his assertion that the value of news "is sometimes better recognised by our readers than our journalists."

"That's a pretty nasty little slap, when you think about it," says the ex-staffer, "because when you flip it, it means reporters know nothing."

I emailed Thomson to ask about the reception of his memo but haven't heard back.

Comments

[William Cowie:]

' "That's a pretty nasty little slap, when you think about it," says the ex-staffer, "because when you flip it, it means reporters know nothing." '

Wrong. It doesn't mean they know nothing. It means they have lost touch with their readers and/or with what's really important. His statement referred to understanding the value of news. What the reporters think is important has become different from what readers think is important. BIG difference.

I, for one, think he has a point, evidence of which is I spend more time on online news sources for news, and Seeking Alpha for 'takes." Now and then I read a WSJ in an airport lounge, and all that does is reinforce the change.

It's one thing to aspire to write leders, noble even. It's another to do it with consistent compelling punch that its de-emphasis outrages the entire financial community, which depends on them. Expect that outrage to be minimal.

Unfortunately for the old guard, they have been pipped in the leder department by blogs and online services, Jon Stewart even. Recent example: the WSJ was handed the Madoff story on a platter. What did they do with it? As much as the sympathy they'll get, I suspect...

Mar 25 01:01 PM

[carey_jim:]

The American oligarchy is only nominally controlled by the handful of CEO's and owners of large corporations such as the Wall Street Journal. Without creative and dedicated employees, no corporation can succeed.

Napoleon was a great general, whatever you think of his political ambitions, in part because he knew how to delegate authority. For example, he instructed his field marshals to disobey his orders whenever the situation on the ground warranted it.

In all wars, when a new lieutenant comes onto the battlefield, he knows that seasoned sergeants and other grunts are the true leaders of his unit and that he will have to spend his first few months learning from them.

More than one naive, arrogant and stupid lieutenant has been shot in the back by men whose first rule of combat is to win battles.

Murdoch is an arrogant, naive and stupid lieutenant but his men are disarmed.

They and the rest of the corporate America have disarmed themselves: The idea that ordinary workers should have a say in the management of their organizations is anathema to everyone at the Wall Street Journal and to just about everyone else in the upper levels of American corporations.

We Americans spend most of our time working for large and medium size corporations, we call ourselves a democracy and yet we have very little power to say how these organizations should be run, as the situation at the Wall Street Journal proves.

Maybe it's time to arm ourselves with that power.

We should start by listening to the words of our war-hardened staff sergeants Ralph Nader and Dennis Kucinich, not to mention thousands of other seasoned grunts.

Or, we could fall on our swords.

Mar 25 01:27 PM

[carey_jim:]

Murdock can do ALMOST whatever he wants to do with the WSJ and your opinion is irrelevant, just as mine is.

If he decides to turn the WSJ into yet another National Enquirer, or even to transform it into a toilet paper factory (some people think it already IS a toilet paper factory), that's his right.

The only thing he CAN'T do is make it into a socialist newspaper.

The American people wouldn't stand for that.




On Mar 25 01:01 PM William Cowie wrote:

> ' "That's a pretty nasty little slap, when you think about it," says
> the ex-staffer, "because when you flip it, it means reporters know
> nothing." '
>
> Wrong. It doesn't mean they know nothing. It means they have lost
> touch with their readers and/or with what's really important. His
> statement referred to understanding the value of news. What the reporters
> think is important has become different from what readers think is
> important. BIG difference.
>
> I, for one, think he has a point, evidence of which is I spend more
> time on online news sources for news, and Seeking Alpha for 'takes."
> Now and then I read a WSJ in an airport lounge, and all that does
> is reinforce the change.
>
> It's one thing to aspire to write leders, noble even. It's another
> to do it with consistent compelling punch that its de-emphasis outrages
> the entire financial community, which depends on them. Expect that
> outrage to be minimal.
>
> Unfortunately for the old guard, they have been pipped in the leder
> department by blogs and online services, Jon Stewart even. Recent
> example: the WSJ was handed the Madoff story on a platter. What did
> they do with it? As much as the sympathy they'll get, I suspect...
>
>

Mar 25 01:40 PM

[Pat Shuff:]

As a long time WSJ subscriber it has steadily gone downhill since the takeover, an NYT wannabe. All politics/geopolitics,
shortening of anything finance related. The longer in-depth format provided context, history, a fleshing out. Now I flip through looking for something interesting just like any other major urban newpaper not subscribed to.

Mar 25 02:34 PM

[Hedged In:]

This is a useful and fascinating article -- thanks Jeff.

The wisdom of Murdoch's instruction to the WSJ journalists to focus on breaking news for Dow Jones Newswire instead of in-depth reporting for the WSJ rests on two assumptions:
1. Readers of the WSJ care most about news, and don't value the in-depth "leders".
2. Dow Jones' Newswire could take share in a high-revenue market if it had improved coverage.

I'm not sure either assumption is correct. Personally, the "leders" were the highlight of the WSJ for me, and the news is a commodity, available from many other sources. And for those of us who have Bloomberg, Reuters or Thomson terminals, there's no need for Dow Jones Newswire. It's a crowded market.

Moreover, to manage a business well you need to identify your competitive advantages and leverage them. The WSJ has competitive advantage in stellar journalists who can research and write in-depth stories. But does it have competitive advantage in trying to be the first to break short news stories?

Anecdotally, I allowed my WSJ.com subscription to lapse last month, as it didn't add enough to the other sources I use, and more and more of the articles were available for free in any case.

Mar 26 08:18 AM