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November 20 Media Newsletter͏‌  ͏‌  ͏‌  ͏‌  ͏‌  ͏‌ 
 
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November 20, 2022
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Ben Smith
Ben Smith

Welcome to Semafor Media, where we break the news behind the news.

The biggest stories in media usually follow the money. Today, Max looks at one of the biggest shifts in the business of media: The capture of most sports media by the online gambling industries.

We’ve also got news about an experimental downtown New York newspaper, the transformation of the Washington Post’s opinion section into something like an experimental downtown New York newspaper, and a truly inspiring story of survival in the independent Russian media.

And: My old boss, BuzzFeed CEO Jonah Peretti, texts about Elon Musk’s strategy.

The team at Semafor Principals in Washington have been hitting their stride, breaking big news, cutting through the noise, and reading all the other newsletters so you don’t have to. Sign up for it here.

Box Score: Trump’s New Media
New York Post

New York: Rupert Murdoch is doing all he can to humiliate Trump and stop his campaign. But Trump’s circle is used to bringing establishment figures to heel, and his former aide Jason Miller told Semafor Friday that the modest coverage of Trump’s announcement on Fox News was merely part of a dance between the candidate and the mogul.

San Francisco: Elon Musk’s decision to bring Trump back gives both what they want in the short term: Attention.

Washington: Trump’s return will be a test for whether the new heart of pro-Trump media, Steve Bannon’s War Room, has truly displaced everyone from National Review to the Daily Caller that have moved on to a new generation of candidates and seem to hope Trump will go away.

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Max Tani

The media’s bet on gambling

REUTERS

THE NEWS

For many years, the New York Times Ethical Journalism handbook prohibited gambling on sports with only three exceptions: Journalists were permitted “occasional recreational wagering on horse racing or dog racing or jai alai.”

But by the time some of the Times’s most accomplished investigators slipped away from the dog track this Sunday to publish a trio of blockbusters on the growth of sports gambling in the United States, things had changed.

In June, the paper changed its editorial guidelines around gambling for the first time in nearly two decades, saying they “may place occasional recreational wagers on sports they do not cover, in line with the laws where they live.”

It was a compromise that came as the Times attempted to rein in sports gambling by staff at the Athletic, which the paper acquired earlier this year, and which until recently allowed its writers to gamble on sports they write about.

The policy shift tracked the substance of Sunday’s investigations. One detailed the industry’s massive and successful lobbying campaign. Another focused on campus partnerships. The third described the journey of Barstool Sports founder Dave Portnoy from “degenerate gambler” to gambling pitchman as “one of the most vivid manifestations of the frenzy.”

At the Times, the internal debate has centered on the Athletic. Several journalists and podcasters at the sports-focused publication had been open about wagering on sports that they write about.

Writers for the site’s NBA, NFL, and MLS sections all have discussed wagering on sports they cover, as have hosts of the Athletic’s Nets podcast, who bet on the team. Another writer for the site’s NFL fantasy section, John Lagheeza, has a side hustle on Patreon where he offers sports betting and advice.

Senior college football writer Ari Wasserman has repeatedly said he placed wagers on various college football games over the past 18 months. And while in the past Wasserman has been a voter for the Heisman Trophy, he mentioned on the Athletic’s Andy Staples Show that he bet on Anthony Richardson to win the prestigious college football award.

The Times has worked to curtail some betting by the sports site’s staff. The paper confirmed that in June, the company informed staff that they were allowed to gamble on sports that they do not cover.

A Times spokesperson said that staffers who work on the betting vertical desk like Wasserman “need to understand the ins and outs of sports wagering to remain experts in the field” and are allowed to wager on sports.

Others who placed wagers before the policies were implemented get a pass: The spokesperson added that sports betting taken before the rules were laid out “would not be in violation of our standards.”

MAX’S VIEW

Sports betting by writers at the Athletic is just the latest example of the awkward integration of the publication into the Times. Last month, the Washington Post reported that Athletic staff were told they are prohibited from saying they worked for the Times. Sports staffers at the Times have raised issues with standards at the Athletic, including sourcing.

But the tensions inside the Times also reflect a broad shift in sports media, and the Times’s own gamble that the Athletic can swim against a powerful industry tide and live mostly on subscriptions and advertising at a moment when gambling dollars are raining down on its competitors.

Some of the origins of sports media are in print publications unapologetically devoted to horse racing, and newspapers long carried the betting lines on games.

But a series of 20th Century scandals involving rigged games — the 1919 Chicago White Socks were perhaps the most iconic — helped give birth to a white glove sports media and professional leagues that kept their distance from the practice, as well as to regulations that confined legal gambling to Las Vegas, Atlantic City, and a handful of other places. In media, figures like the oddsmaker Jimmy the Greek, a fixture on CBS’s Sunday NFL broadcasts, was a vestige of a more colorful past.

But the rise of fantasy sports, right at the edge of gambling, and of the industry giants FanDuel and DraftKings began to change that. And a 2018 decision by the Supreme Court that paved the way for states to legalize sports betting triggered a mad scramble to find new consumers on the internet.

Since then, sports gambling has already grown into a huge business for the advertising world: Research firm MediaRadar said the gambling industry spent almost half a billion dollars on advertising between November 2020 and November 2021, and major gambling companies are showing few signs of slowing down.

Many online gambling companies have launched their own shows around sports commentary. Former ESPN president John Skipper’s company Meadowlark has partnered with DraftKings on several sports podcasts, including a $50 million three year deal to distribute the “Dan Le Batard Show with Stugotz.”  FanDuel TV, which launched this year, scooped up The Ringer’s Bill Simmons and PMI’s Pat McAfee.

News media companies have almost all tried to get a piece of the action. In 2020, Turner announced partnerships to collect referral fees from DraftKings and FanDuel in exchange for integrating betting information on TNT, which has rights to some NBA games, and Bleacher Report. FanDuel also has a deal with The Ringer, which is allowing the company to license the site’s content. Authentic Brands Group, which owns Sports Illustrated, announced a partnership last year with 888 Holdings to create a sportsbook.

Yahoo Sports is partnered with MGM on a gambling sportsbook, while ESPN has partnerships with DraftKings and Caesars in what it describes as “co-exclusive link integrations” across ESPN’s website and broadcast.

Even as a Times property, the Athletic has continued its partnership with BetMGM, which provides betting odds in the Athletic’s content and products.

No media company is more fully committed to the gambling industry than Barstool, whose CEO, Erika Nardini said a growing part of the business is driving its audience toward Barstool’s branded sportsbook, which is operated by Penn Gaming, and physically getting people into casinos with live Barstool events.

“We’re the funnel,” she said. “It’s the affinity and the connection with our audience and the Barstool Sports brand that aids in driving the conversion.”

Barstool, she argued, is particularly well-positioned since its bloggers, podcasters, and personalities are fans with little contact with teams, not sports insiders.

“I think companies like ESPN, The New York Times, and others who feel that they have some banner to uphold with regard to what their editorial covers and don’t cover — they’re having a struggle with sports betting,” she said. “It’s a sin business, it used to be illegal. There’s no higher purpose.”

NOTABLE

  • For the most part, state gambling regulators have not clamped down on the Barstool/Penn relationship, despite Portnoy’s history of massive gambling debts. Gambling regulators in almost every state where Barstool Sportsbook operates have bought Penn’s argument that Portnoy does not need a gaming license because he is not involved in running the actual betting operation.
  • Many media company betting partners like FanDuel and DraftKings have faced increasing complaints from customers who have had trouble withdrawing funds from the betting platforms. The Better Business Bureau gave FanDuel an A minus rating and DraftKings a B minus. BetMGM, the Athletic’s partner, received an F.
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Intel

Posties

Washington Post opinion writers have mixed opinions of their new boss, David Shipley, after he delivered a mandate to write less and encouraged suggestions that opinion columns could at times be replaced by, oh, short poems.

Shipley beat out columnist Ruth Marcus for the job after the longtime opinion editor, Fred Hiatt, died suddenly in 2021. His mandate, two employees told Semafor, is to blow the place up. Some staff were taken aback by suggestions in a recent brainstorming meeting that the paper could publish editorials in the form of Instagram comments or haikus.

A spokesperson for the paper said that readers will see the opinion section evolve, and the recent meeting with staff was part of Shipley’s desire to be “relentless about exploring fun and important ideas.”

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One Good Text with... Jonah Peretti

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Intel

Abandoning Ship

Last Call
The Drunken Canal

The Drunken Canal, an irregular lower Manhattan newspaper that got a lot of attention (not least from me, at the Times) during the depths of the pandemic, is ending its run on or around December 16, its founders said.

The paper, devoted to the doings of a small Gen Z rebellion against big, earnest millennial media, did a great job at telling its own story.

One of the founders, Claire Banse, compared herself to Alice outgrowing the White Rabbit’s house.

“We have come to the realization that that time period is over. We no longer live without a world, we have no need to print one into existence as we did during the pandemic. The world is back and buzzing and we are aching to spend some time in it,” she wrote.

Her partner Michelle Guterman, who goes by “Gutes,” explained the decision through a complicated metaphor involving canals. “Just replace the water with beer and problem solved,” she concluded.

Their final call for submissions appears to be a 48-hour window for material that they pledge to publish in their final issue.

– Ben Smith

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Intel

Beating the Censors

The Russian news organization Meduza built a big audience after its founding in 2014 with independent reporting and catchy, engaging digital journalism. Remarkably, it’s managed to retain millions of readers in Russia despite being blocked in the country in March.

“It’s all about courage to continue,” Meduza executive editor Galina Timchenko told the Committee to Protect Journalists in New York Thursday night after receiving the 2022 Gwen Ifill Press Freedom Award.

The site’s survival is also a study in how savvy journalists and hungry readers can connect in spite of a powerful government.

First, when it became clear in February that a ban could be coming, the site promoted its other channels, tripling the size of its Telegram account and leading to hundreds of thousands of podcast downloads.

Then Meduza customized its app. “Now it contains several technologies that help us avoid blocking in Russia,” editor-in-chief Ivan Kolpakov told me, declining to go into detail. App downloads have surged to 1.5 million from 350,000.

Web traffic has returned to its old levels too as Russians adopt virtual private networks (VPNs). Meduza had about 10 million unique visitors in September, including many new readers from Ukraine, Kolpakov said.

(You can sometimes find Meduza’s reporting in the Semafor Flagship newsletter.)

— Ben Smith

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Staff Picks
Libo Libo
  • As seems often to be the case these days, all the stupidest rumors about AT&T’s takeover of Warner Media were true, the Times’s James B. Stewart writes in a spectacular narrative of one of the worst deals ever. Among them: Donald Trump reportedly put pressure on the company to fire CNN’s Jeff Zucker amid a series of bungled political efforts that left Zucker with “more job security than anyone at Time Warner.”
  • Mike Bloomberg apologized after Boris Johnson delivered a scabrous talk describing Russia and China as “coercive autocracies” at the Bloomberg New Economy forum in Singapore. The issue, a source tells The Guardian’s Pippa Crerar: “In Britain it would have been absolutely fine to single out China. But in Asia it wasn’t.”
  • Ben Shapiro’s Daily Wire is one of the best performing new media businesses in the United States. While other new outlets have struggled to build sustainable ad businesses, the site has shifted its energy from winning right-wing Facebook into a booming subscription service, and claims more than $200 million in revenue.
  • I spoke to the Times’s Maggie Haberman at a Semafor event Washington Friday night. She said she won’t be covering Trump the same way she did before her definitive biography, and that we shouldn’t hold our breaths for Volume Two.
  • And speaking of Russian independent media, a breakout podcast hit has met the dark political moment. The new season of The Robber’s Daughter from the studio Libo Libo reveals sexual abuse at summer schools beginning in the 1990s. The show carries the voices of victims and, chillingly, of abusers who still don’t think they did anything wrong. The show doesn’t mention the war in Ukraine, but stories of powerful, abusive men are resonating in Moscow for a reason.
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— Ben

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