How a generation of journalists got schooled on the perils of wage slavery
If you haven’t got an equity stake, you’re (a) eminently disposable and (b) never going to get rich
Back in the early aughts, I was editing a lowbrow men’s magazine. At least partly due to my efforts, the circulation improved. While I wasn’t privy to the financial upsides of this – for reasons that will soon become apparent – I’m guessing that the magazine began generating at least $200,000 more a year than it had under the previous editor. My boss was delighted at this turn of events. I assumed he would reward me with a significant pay bump when salary-review season rolled around.
From memory, I was earning $60,000 at the time, which even back then wasn’t much. (It probably wasn’t even the median full-time salary.) One day a letter appeared on my desk thanking me for my efforts over the last 12 months and informing me my salary had been increased to the princely sum of $61,800. This is even more insulting than it seems given the company was locked into giving all staff an automatic three per cent annual pay rise.
I expressed my disappointment to my boss. He made some soothing noises that I was a “key man going forward” and that promotions and pay raises would arrive soon enough. They didn’t. I later discovered my boss was in the habit of reassuring people – or at least people who were currently making him look good – that he was in their corner while never actually delivering much for them then turning on them overnight once they were perceived to have outlived their usefulness.
But I was powerless. I could have resigned, which I gave serious thought to, but there was no reason to assume I would be treated much better at any other magazine company. The magazine I was editing was owned by Kerry Packer, not me. If I wasn’t willing to run it for $61,800 then there was no shortage of other people who would jump at the chance.
Just to rub more salt into the wounds, my boss almost certainly got a handsome bonus, and quite possibly some shares in Packer’s magazine company, for keeping salary increases to a minimum.
It was the first but certainly not the last time during my journalistic career that I was to be taught a hard lesson about the downsides of being an employee.
If you’re any good at what you do, you work for yourself
Many years ago, I read a not particularly memorable article about a not particularly significant individual. But something the interviewee said lodged in my brain permanently – “If you’re any good at what you do, you work for yourself”.
I didn’t work for myself at the time and it would be quite a few years until I started my own business. Nonetheless, I was struck by the unvarnished truth of the remark. Those who believe, accurately or otherwise, they have something of value to offer the world expect to own – or at least have an equity share in – a business.
They must exist, but I’m yet to come across any brain surgeons or orthodontists who don’t work for themselves. While many bright and ambitious lawyers, accountants and management consultants do consent to 10-20 years of being an employee, their goal is to make partner. That is, be given an equity stake in the business they have spent their twenties and thirties working for.
Those who concentrate on climbing the corporate ladder must often wait until their fifties to be ushered into the C-suite. But along with a corner office and attractive salary, they are typically rewarded with stock options. It’s the stock options that – if the company performs well up until the date the options can be cashed out – can generate significant personal wealth.
(Among many other good and bad innovations, Jack Welch popularised the practice of rewarding those near the top of the org chart with stock options. Welch accrued plenty of stock during his 20-year reign as Chairman and CEO of General Electric, which why he retired with a net worth north of US$700 million.)
It’s not just highly educated, overachieving upper-middle class types who are focused on ‘getting a piece of the upside’, as our American friends put it. If you’re a self-confident architect, baker, bookkeeper, caterer, cleaner, content provider, event planner, financial advisor, graphic designer, hairdresser, landscaper, masseuse, mechanic, personal trainer, physiotherapist, plumber, real estate agent, videographer or virtual assistant, you’re going to be inclined to hang out your own shingle rather than “work to make some other bastard rich”.
This brings me to a couple of interesting recent developments in the world of journalism.
Do software developers have bigger egos than TV news anchors?
After the GFC, the long and continuing collapse of the media industry began in earnest. Newspaper, magazine and free-to-air TV businesses that had once been a licence to print money started haemorrhaging revenue.
This was unfortunate for media magnates like Rupert Murdoch, but it was disastrous for their employees. I’m not sure what the exact figures are, but somewhere between a third and a half of all media workers have lost their jobs over the last 15 years in Australia. It’s a similar story in many other countries.
Almost by definition, journalists are egotistical. You’re not likely to assume the world desperately needs to hear what you have to say if you’re the unassuming type. But, especially in retrospect, it’s amazing how few journalists were egotistical enough to think they could make it as self-employed businesspeople. There were always entrepreneurial exceptions, ranging from Christopher Skase to Mike Willesee to David ‘Kochie’ Koch. But even the most self-regarding media personalities and most fearsome senior media executives have typically been content to work for someone else rather than go out on their own.
Even after experiencing ever-growing workloads and ever-shrinking pay packets, as well as either witnessing or being caught up in never-ending rounds of redundancies, a bewildering number of what are now called content creators are willing, even eager, to be employees. Despite the evidence of their lying eyes, they are also often reluctant to dispense with the delusion that their employer will always have their best interests at heart and ultimately reward them for their poorly paid or even entirely unpaid efforts.
The naivety of supposedly hard-bitten, cynical journalists has been underlined in recent weeks by the move to spin off tech businesses owned by media businesses. Long story short, after realising the Internet wasn’t going to be some short-lived fad, old-school media companies belatedly decided to get with the digital-economy program. Newspapers have a lot of content. In recent years, many of them decided to create their own content management platforms. Some of the larger newspapers now have ambitions to sell the sophisticated content management platforms they’ve developed to other organisations.
It’s been feasible for newspapers to hire a handful of software engineers and develop an in-house content management platform. But as tech and media journalist Simon Owens has observed, growing a tech company within a media company can be hard. In relation to Jeff Bezos looking into spinning off Arc, the Washington Post’s content management system, Owen refers to the following passage from a (paywalled) Wall Street Journal article:
Incubating a tech startup inside a larger company — and drawing in the investment and talent needed to build it into a larger enterprise — can be challenging… Mr Prakash at times pushed for greater investment in Arc and argued that as a stand-alone company it could do a better job recruiting top engineers, by offering them equity and giving them more freedom to work remotely than was possible at the Post, the people said.
The fact that’s being danced around here is that, in stark contrast to journalists, tech-industry employees expect to get paid a hefty salary and also be in a position to score a multi-million dollar payday if the tech business they work for succeeds.
What “can be challenging” about the situation Washington Post executives now find themselves in is that there is a select group of digitally savvy Washington Post employees earning $200,000 - $400,000, getting stock options and working from home for no more than 40 hours a week while almost all of their journalistic colleagues are spending 50-80 hours a week in the office and not getting any stock options or even bonuses, all for a grand total of $50,000 -$150,000.
Even in these tech wrecky times, no self-respecting software engineer would be prepared to accept the kind of remuneration package that a journalist expects. And no media magnate wants their loyal minions getting any uppity ideas. Far better to cleave the media and tech sides of the business in two well before there is a chance for any workplace trouble to kick off.
A possible happy ending
Technology, especially the Internet, has been a double-edged sword for content creators. The Internet – more specifically two Internet companies, Google and Facebook – efficiently drained the rivers of gold advertising revenue that made media companies such an attractive business proposition throughout the 20th century.
On the other hand, technology – more specifically the Internet along with laptop computers and smartphones – has made it much more feasible for content creators to launch micro businesses. Or even not-so-micro businesses.
At the same time commentators were discussing newspaper companies' plans to spin off their content management platforms, many of them were also marvelling at the expansion and rebrand of Bari Weiss’s Substack-based mini media empire. After being chased out of the New York Times by young wokesters, Weiss started a Substack newsletter called in early 2021.
Initially, it was just Weiss churning out the content. But soon her wife and sister were regularly contributing and before long various journalistic acquaintances were also placing articles on her Substack that would have been deemed “problematic” by the lamestream media. Weiss has been liaising with senior figures at Substack for some time about creating “a newspaper for the 21st century”. About a week ago, she officially launched .
Like a handful of other iconoclastic writers who had the opportunity to build their personal brand while working for iconic publications, Weiss has won at the Substack game. She’s now accrued enough paying subscribers generate hundreds of thousands of dollars in revenue annually. If her ambitions for the are realised, she may soon be generating tens of millions.
I imagine Weiss has paid her contributors and whatever staff she’s employed reasonably up until this point. Presuming her venture is a success, the question Weiss will need to ask herself is whether she wants to grow obscenely rich off the labour of overworked and underpaid hacks or whether she’s content just to be reasonably rich and give her underlings a piece of the upside.
As a new generation of media magnates comes to prominence in 2023, it should become clear whether those working for the media organisations of the 21st century can expect to be feted like software developers or should resign themselves to be treated as poorly as their 20th century predecessors.