Commercial media’s attitude toward journalism labor became apparent in the Journatic brouhaha following a whistleblower’s exposé aired on public radio’s This American Life in the summer of 2012. Journatic is a shadowy “hyperlocal content provider” that reportedly eschews publicity to the point where its site contains code that lessens its appearance in Google search results. It contracts with dozens of U.S. commercial news media to provide local coverage, including Newsday, the Houston Chronicle, the San Francisco Chronicle, and the Gatehouse newspaper chain. The Journatic business model is premised on the idea that doing routine local news with actual paid reporters is no longer a viable option for many American news media, so it provides a discount alternative.

Journatic’s local coverage is provided by low-paid writers and freelancers in the United States and, ironically enough, the Philippines, where Journatic hires writers “able to commit to 250 pieces/week minimum” at 35 to 40 cents a piece. Journatic CEO Brian Timpone says that the compensation was “more than most places in the Philippines.” They produce stories under bogus “American-sounding bylines” that make it seem as if they are based in the local community running the stories. Part of the reason aliases are used is that it would be suspicious to readers and other journalists if they saw the number of articles a single writer produced, not to mention the importance of maintaining the illusion that these are local reporters.

Not surprisingly, these stories are “little more than rewritten news releases,” as the whistleblower put it. They also contain a considerable number of errors, fabrications, and instances of plagiarism. But to the casual reader of a Journatic client, it would seem the newspaper or website was chock-full of original local material.

The Tribune Company, which owns the Chicago Tribune, invested in Journatic in April 2012 and outsourced coverage for the Chicago area’s ninety TribLocal websites and twenty-two weekly editions to it. TribLocal laid off half of its forty staffers when it contracted with Journatic, and its output tripled.

When word got out, ninety members of the Chicago Tribune newsroom presented a petition protesting Journatic’s role. On July 13 the company indefinitely suspended use of Journatic in its papers, but the hyper-local content provider is still very much in action in other markets, waiting for the bad publicity to blow over.

This is hardly the end of the story. A Pasadena publisher, James MacPherson, stated he wanted to “defend the concept” of outsourcing, claiming that “Journatic has done it quite shabbily.” His firm had begun outsourcing journalism to India in 2007, but the program was postponed soon thereafter as he was apparently ahead of his time. Macpherson uses Internet software developed by Amazon in 2012 to contract with freelance reporters all over the world and says, “I outsource virtually everything. I am primarily looking for individuals who I can pay a lower rate to do a lot of work.” He concedes there are limitations: “There is no way someone in Manila can possibly understand what is happening in Pasadena.” But the economics are such that Macpherson argues outsourcing is inevitable:

As journalism becomes increasingly rote, the logical question becomes who needs human labor at all? StatSheet, a subsidiary of Automated Insights, uses algorithms to turn numerical data into narrative articles for its 418 sports websites. Automated Insights now also computer-generates ten thousand to twenty thousand articles per week for a real estate website, and the emerging computer-generated content industry is convinced that algorithms will become a key part of writing news stories in the near future. “I am sure a journalist could do a better job writing an article than a machine,” says a real estate agency CEO who contracted with Automated Insights, “but what I’m looking for is quantity at a certain quality.”

In short, the Internet does not alleviate the tensions between commercialism and journalism; it magnifies them. With labor severely underpaid or unpaid, research concludes that the original journalism provided by the Internet gravitates to what is easy and fun, tending to “focus on lifestyle topics, such as entertainment, retail, and sports, not on hard news.” As traditional journalism disintegrates, no models for making Web journalism—even bad journalism—profitable at anywhere near the level necessary for a credible popular news media have been developed, and there is no reason to expect any in the future.

There is probably no better evidence that journalism is a public good than the fact that none of America’s financial geniuses can figure out how to make money off it. The comparison to education is striking. When managers apply market logic to schools, it fails, because education is a cooperative public service, not a business. Corporatized schools throw underachieving, hard-to-teach kids overboard, discontinue expensive programs, bombard students with endless tests, and then attack teacher salaries and unions as the main impediment to “success.” No one has ever made profits doing quality education—for-profit education companies seize public funds and make their money by not teaching. In digital news, the same dynamic is producing the same results, and leads to the same conclusion.

Excerpted from “Digital Disconnect: How Capitalism Is Turning the Internet Against Democracy” - Copyright © 2013 by Robert W. McChesney. Reprinted by permission of The New Press.  www.thenewpress.com

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