Masters in Business: Bloomberg L.P. Grueskin (Audio)

in the world. Bill Um has pretty much seen everything there is to see in the world of the business, world of journalism, and we're trying to do more of these shows that aren't just fund managers or economists, but actually bring people in who have run businesses and can

talk about it. Bill is uniquely situated. He's seen both the decay in the traditional business of journalism, but he's also been very active on the Wall Street Journal dot com site, which is by all measures, been wildly successful. They probably have of all the mainstream media tablet products, they probably have the best iPad um app I've seen. It's just really a pleasure to use in order to read a newspaper. They're they're fantastic. I know Bill for

a good couple of years. I first met him early in the days of Wall Street Journal Digital when they were considering rolling out this thing called blogs, and Bill and I had had a breakfast actually not too far from here, over at Persian Square Cafe going over what they can expect and how they should approach the idea of blogs at the Wall Street Journal, and they took some of my advice. A lot of my advice they didn't.

But I think some of the blog that we've seen that the Wall Street Journal have put out, notably Money Beat and Real Time Economics, have really garnered a pretty big following and are a nice addition to the paper itself.

I've also spoken with Bill, and I've spoken to classes at the Columbia School of Journalism about enumeracy and how easy it is for reporters to get bamboozled by numbers, especially with what we've seen from trade groups and associations or politicians trying to twist economic releases in their favor. It's very, very easy if you're don't have a facility with numbers, are you're not especially good with math um.

If you're an English major and your specialty is writing, not you know, doing calculations, to not fully understand statistics, not fully understand mathematics. It's it's a challenge that reporters have always had, and today, where there's so little training and so little apprenticeship periods, it's become even uh more of a challenge. And and I recall speaking to him in a class at Columbia way back when I've done it once or twice, and it was really quite fascinating

discussing how not to misinterpret economic data. But Bill has really a unique insight into the business of journalism, what works and what doesn't work. And I think you'll find this to be quite an interesting conversation. It's a little inside baseball, but interesting nonetheless. And so with no further ado, here's my interview with William Gruskin. This is Masters in

Business with Barry Ridholts on Bloomberg Radio. On today's show, we're discussing the business of journalism, and I'm pleased to having the studio Bill Gruskin. He's currently executive editor here at Bloomberg. Wired to that he was dean at the Columbia School of Journalism and he spent many years at

the Wall Street Journal. Most recently he was managing editor for The Wall Street Journal Online, which I believe is one of the largest subscription site in the world, actually the largest subscription news site, because Consumer Reports has always had and I presume still has more subscribers than than wh dot com. But when it comes to news sites, yeah,

so largest. And you were managing editor of the paper proper and I was deputy managing editor for UM in two thousand seven and two thousand and eight, overseeing all the domestic news bureaus as well as all the editing functions. And let's let's get and start with your background. Undergraduate degree in classics from Stanford. You then went to John Hopkins and got a master's degree in US foreign policy

and international economics. There you go, right, pretty good set of broad based background to look at the world's of business and finance all the Oh, I didn't actually get involved in business until I got to the Journal in I'd spent about fifteen years doing metro journalism. So that's a really interesting entree. What was it, Uh? You know, Rupert Murdoch and his predecessor, the Bancroft's not known for being especially generous with journalists. What was the appeal to

bring you over to the Wall Street Journal. Well, what they were generous with was providing time and space to do really great journalism in the mid You might remember what the old Wall Street journalis still look like, totally gray, two big long legs of type on on the left and right, and then the little story in the middle that we called the a head. And and I was recruited to work on what they called the page one desk. And there still is a page one desk at the Journal.

But I remember when I first got there. This is when the journal ran five days a week, right, so we had three stories on the front page. You can do the map three times, five fifteen stories. We had twelve editors editing fifteen stories a week. Now, when I worked to the Miami Herald, you would do fifteen stories a night. It really wasn't that unusual. So it was like coming into the Garden of Eden and saying in depth, a little quirky, esoteric exactly. I love those a head

stories that were great. The a heads were great, the column six, the stories on the right side of the page. Generally we're pretty heavy on the business and economic front, often driven by news stories on the left side you might remember, tend to be more like features. We look at things like race, we look at things like culture, you know, um, pretty much anything under the sun. And it was just an amazing I feel very fortunate to

have been part of that. And you left when Murdoch came in or what was the time, So I had a coincidence. I did leave about six months after Murdoch officially took the reins, and it was kind of a coincidence of several things, but the main one was I got a call from Nick Lemon, who at that time was the dean of Columbide Journalism School, and he said, we're looking for somebody to really move the school into

the digital age, and it was a great opportunity. Let's step back and look at them much bigger picture, the changes in the industry. And I referenced a chart that I think was Ryan Chitham of the Audit, which is right, showed that revenues at newspapers are back to levels of nine three right inflation adjusted. Yeah, astonishing, astonishing figure. I mean, it's it's a it's a pretty clear trend line. So so is it the business model that's having trouble or

is it the content that isn't itself at issue? Because we've seen a lot of things change. So you might remember the first time I met you, I think you were You've been doing your blog for about a year or two and four, yeah something, and dot com was about to dip its big toe into blogs, and and I wanted to take you out to breakfast. And that's right. We went to the best whole wheat blueberry pancakes. And I didn't get an endorsement for that, but but I

deserve on. So that's um, that's ten almost over ten years. It's probably about ten years ago. It's in the decade. Man. You and I are old. We are. The funny thing is when when I began blogging, it was, oh, this is kind of fun and interesting. I don't have to send the letter to the eddler. I could do this to say, right, right, and maybe someone will read it, maybe someone won't, right. And I remember I still remember, um dealing with top corporate people at Dow Jones when

we were gonna start blogging. I'll never forget there was this one executive, a woman with a Southern accent. I'll never forget. She said, why do people want to read blogs? You know, if you want to read an opinion, you're gonna want to read it from the Journal or the Times or something. And of course that that was clearly

not true in two thousand four. Now ten years later, you know, when you look at the number of sources on on business news and some of it, some of it's great, and some of it's horrible, and a lot of it's kind of in the middle. And I think one of the big challenges for all of us UM in the journalism world right now is how do you help readers navigate through that at you know, you look at Seeking Alpha, you look at Business Insider, you look

at Yahoo Finance. I mean, these are very different UM outlets, but these have huge audiences and the millions of people. So what does the content creation industry say about journalism, financial media our world? So, you know, in the journalism world, there's really kind of two kinds of content creators. There's the people who are out out there doing the original reporting. There they're going through you know, balance sheets and and

and SEC filings in order to dig up stories. They're they're listening to conference calls to try to ferret out what the speaking to original sources exactly, exactly doing original journalism. Then there's a lot of people out there who are aggregating or providing commentary, analysis and opinion around what they're doing, and those are not two complete divisions between each other.

Any good news website has some kind of aggregation function to it, and a lot of people, including you, Berry, will I go and find something new and you'll reveal it to your readers which did not appear in the Journal or The New York Times Bloomberg. I'm Barry Ridhults. You're listening to Masters in Business on Bloomberg Radio today. We're speaking with Bill Gruskin, currently executive editor at Bloomberg, but previously Dean of the Columbia School of Journalism and

former managing editor for The Wall Street Journal Online. So this has always been the complain about bloggers in general, is hey, we're doing original, certainly a complain about the people who only did aggregation. Like I. I spent the latter half of my career. I began as a trader and became a strategist, so I was cranking out original stuff every day, and I always in oh three, oh four,

oh five. That's really what I was fleshing out the blog with It was only later where I discovered, hey, I have a ton of stuff I look and you and I discussed this. I have a ton of stuff I look at at the end of the day that just dissipates from my head. If I make a list of the ten most interesting things I've read, maybe that

has a value to somebody. And I've been now doing that for a decade, right, And so it's not that I'm now I'm completely understand the business side of journalistic complaint that hey, we're doing this original research and one of these sites, that was the Beefed HuffPo that they would take all this original content and do an intro sentence and an outro sentence and data and how is that not copyright violation? Well, as long as you're only taking a small excerpt, then it falls with it. And

I think they were also taking the punchline. You know, if I don't here's a thousand word article, let me take the hundred and fifty most important words. Why do I have to go read readers is plenty right, I mean, they don't necessarily to read a two thousand words Sorry about why the CFO of the Facebook just stepped down yesterday. You know, they just want to you know, the headline, a couple of paragraphs and boom that they're often story right. So you know, I think this has been hard. You know,

the traditional media companies have a lot of problems. The main one is in a digital world, every single piece of content gets atomized, right, so you don't necessarily need it all to be delivered you in one package that hits your doorstep, or that's like a thirty minute broadcast on TV. Every every article, every photo is available anywhere in the world. You could create your own paper, a little of the Times, a little f T, a little Bloomberg, and that's your own very few and I wanted to

we kind a laptop. We could go to WordPress and we could create a website and literally two minutes and anything we put on that website would be instantaneously available to anybody in the world. Think about that. That's a that's a game changing That that is a game changer, and that's scary and and it fundamentally and irrevocably changes the economics of our business. You've done a lot digital media. You've looked at the changes in the business model of

media and financial reporting. Let me, I wrote a few company names down because I was knowing I was going to speak to you. I was thinking about, let's think about the companies who are making running a journalistic enterprise and challenge and not so much from the content side, from the business side. So here's the shortlist that came up with. Craigslist essentially gutted the class if it's a huge source of revenue for eBay has done a lot to take over the sale of used cars and new cars,

Zilo and Trulia on on residential real estate. UM, I don't know what mobile has done to the business model, but it's just another wild card, another random factor. And you know when we talked, we talked earlier about blogs and Twitter. They're really more in terms of content. But what about things like Facebook? What is Facebook advertising which seems to be doing well? How is that challenging? How

are all these companies challenging the business model of journalism? So, you know, the interesting thing is a couple of years ago, people used to really focus on things like Craigslist, which, as you said, really did a job on newspapers classified ads and newspapers class fied ads. I think they had like an eight kind of margin that they were just you know, any idiot could run a local newspaper, you know. But what's interesting so with Facebook and obviously with with

Google as well, so you have a few issues. One is they're just generating huge amounts of advertising inventory. It's just at a scale that's that no news organization can really hope to match. You know, even the Guardian or New York Times dot com. You know, they don't come close to holding a candle where did? I was reading in one of Facebook learning stories today that two thirds of their one point two billion users log on every day. They have they have two interesting data points, daily average

users and monthly average users. But the one caveat I'll warn you about is if you click a like button, that account is having logged on, which really, what is the net dollar game is zero increase the where their profits seemed to becoming. Our people on the site looking at the stream, looking at ads going by. But even let's say it's a third of their advertise, it's still an immense daily number of page views exactly. So you know a few years ago back lines at w dot com,

we were looking at digital ad rates. Uh, they call them the CPMs, which is the cost per thousand impressions, be ten twenties. Some parts of the sites were I don't know what comes AD rates are these days. I seem they're still pretty high because it's a premium audience. But a lot of publishers are looking at CPMs of seventy five cents a dollar because that's what Facebook charges right well, But keep in mind it's a mass audience, and the financial audience. I could tell you on the

blog five years ago dollars was not uncommon. Now it's three, four or five dollars. I mean it's a side it's a side business. It's and there was never intended to be my main business. But if that's your main business, that's a drop in revenue, and and it's clearly going down, down, down all the time. So a lot of news sites are now in a situation where they're trying to generate more and more traffic just to keep their head above water.

You know, if you can generate twice as many pages and the CPN goes down, you're exactly where you were last year. But it's very hard to drive twice as many pages every year, and you're compromising your content slide shows and extreme headlines and exactly well all of the worst sort of clickbait stuff that you know, really takes you from true journalism to write. And there's a reason people look at web based stuff somewhat differently than they do um a print outlet like the Times of the Journal,

because a lot of it is nonsense. Yeah, and also advertising on most news websites is terrible. I mean it just does. I mean the ads themselves, theseves, the formats have not really improved. Why I first got to dot com in two thousand one that they were showing me a rectangular ad that would go on the homepage of what they call three D by to fifty which stands for stands for the number of pixels. That was two thousand one, and I agreed to put her on the

home page. The add to part. When you go to dot com now or pretty much the website, that's pretty much what you see. It's been thirteen years. You have seven ten by nine. I mean sometimes you get the skyscraper. I think it's one sixty. I mean, everything else has changed in the digital world, but this kind of concept of we're gonna give you or a rectangular ad We're gonna stick next to a story and somehow there's gonna be a lot of value for the advertiser. It's just

not true. I'm Barry rid Hults. You're listening to Masters in Business on Bloomberg Radio. Today we're speaking with Bill Gruskin, currently executive editor at Bloomberg, but previously Dean of the Columbia School of Journalism and former managing editor for The Wall Street Journal Online since you left the Journal, or really a better way of saying this is, over the past decade, we've seen the sort of uh segregation of outlets by political partisanship. And so I jotted a few down.

So you have Fox on the one side and MSNBC, which is really smaller version of it. I tried to figure out who was the other side of Drudge. I can't really put that really isn't on the left. The left is completely right. The right seems to walk a little more in lockstep. And then you know, so you have you have people like um, Matthew Iglesias and and

obviously Paul Krugman. But Krugman is a guy. Krugman is a guy with a very specific I have to remember interviewed him last week after Kruger, Right, that's a good way to remember that. But what is this bifurcation by politics? Because because the studies seem to show people on the right go read their sides, people left go read and you end up with this alternative to alternative universes, neither

of which necessary necessarily reflect reality. So the first thing to keep in mind is the actual size of these audiences. I mean, here in New York City, we tend to focus a lot on these outlets like MSNBC and Fox. What does MSNBC's nightly audience two hun a thousand viewers or something like that. Blog post can get that, Yeah, and what's the size of how many people live in this country? Fox News is much much better than MSNBC was having one and a half million viewers a night

something like that. So first of all, you know, we all here in New York get very focused on this, but when you actually get out of New York City, you find out that, you know, outside certain pockets, not really that many people actually watched these programs that work care And I wouldn't be surprised if you know, half of Fox news audience comes from Jon Stewart and Steve Colbert, because they need they need the material exactly exactly. So secondly,

you know, this is the way the world used to be. Um, I mean really, I mean go back a century. You're talking, I go back fourty or fifty years. I mean basically, so what happened maybe a little bit more than fifty years ago, but um, pre war, from pre war, you would take a city like New York City and it had a whole bunch of day newspapers. It didn't just have you know, two or three. Uh and most most metro areas these days only have one newspapers. Yeah, if

you're lucky. So if you run the only newspaper in town, you have to be very objective in the middle of the road, right, because you can't piss off the Republicans campus on the Democrats. But in the old days that there were newspapers that were very closely aligned with various political factions and political parties. And this is the way that the world used to work. So this is nothing new,

this balkanization to anything. What was new was the relatively brief period of time where you had these you know, where every city has one and only one very objective news provider that like didn't cross the line between the two. And I have to tell our audience. You're waving to every other person that goes by between between the Wall Street Journal and Columbia, you must know half this building. I feel like even the guy who fills up the

coffee machine probably worked at the Journal at some point. Yeah, did you guys have good coffee machines? We did for a few years. Yeah, yeah, no, no, And as I call you, you actually had to pay for it to Oh really? Yeah? Right right, Well, the secret is to have a data services business that subsidizes the We tried. We just weren't quite as good at it as Mike Bloomberg. Can I tell you something? Tell rate? And what was the Reuters product? Oh? Icon or well that's the new one.

I don't know what. There were three or four companies that were in the running. I mean, I say this is an observer and not to kiss his behind, but pretty much that race is over now. It seems like it's kind of fascinating to see a really competitive mark. It's like search. Hey, there were all these companies and then Google just said, everybody, here's the new search algorithm. You all lose and that's kind of what happened. It's

a relatively rare thing to see happen. Yeah, well, so they call the Network of Right basically at certain point the customers go to that's that's what happened here. So we were talking about that's a really interesting observation. In other words, objective journalism and middle of the road. Hey, I'm not gonna share my opinion. I'm just gonna report the facts. Post war aberration last and half a century, right, and now we've gone back to the pre war version.

Some look at there's still many news outlets that that still you know, play it down in the middle, and certainly any of the really big national news organizations. I mean, obviously there are people are going to disagree, but I would say, you know, there's a lot of news out there that that that is that I think we all consider is more often than not very objective and and which you really want to strive for. It. I told journalism students this all the time. Isn't so much objective

as being a fair and open minded journalists. I'm Barry Ridhults. You're listening to Masters in Business on Bloomberg Radio today, speaking with Bill Grupskin, currently executive editor at Bloomberg, but previously Dean of the Columbia School of Journalism and former managing editor for The Wall Street Journal online commentary and opinion. Isn't that something that journalists would Hey, that's the gravy taint train. You put in your years, you get tapped

and now I'm a commentator. I published less and and get paid more. That that was really a certain And you can see this with a ton of people. Uh and then eventually you get a talk show and and you know, there you are talking into a radio microphone. But the real fascinating thing for me is, as someone who's an investor, as somebody who consumes an awful lot of journalistic content, what is the future of this industry

gonna look like? Not just in terms of politics and left right, but in terms of look I have my stable of people that I think are I mentioned Jason's why Girl, Dan Gross, who's with the Dale Beast in Gretchen Morganson at the New York Times, and I could probably put together a list of twenty people. It doesn't matter what masthead they're publishing under. Um, I want to read what they have what I have to see, So

So here's what's really interesting about that. You can create a Twitter feed or an RSS page where you scoop up Jason's column, Gretchen stuff, Jesse's stuff, you know, and you can basically create your own homepage, right, I mean, whether it's Twitter or using RSS or or Google Plus

or something along those lines. And so the idea that you have to buy the Wall Street Journal in order to read Jason, or the idea that that you that you that you that you have to buy the New York Times and already Rea Gretchen, you know, that's sort of dissipating these days. And so what's gonna fund them? How they're not going to do that work if no one's paying their salaries. I mean, we're seeing increasingly increasing adoption of pay walls, and scrip was inevitable, wasn't it. Uh,

you know, it seems inevitable now. I remember when I was at Comments had a paywall going back to to you know, people thought we were crazy in the early two thousand's, and I would sit there on panel after panel being be rated by the future Internet people saying, you know, you guys have to take down your paywall. You aren't part of the conversation and we can't link to you. The The advice I gave you with that breakfast a decade ago was to put your blogs outside

of the paywall, but only let paid subscribers comments. Everybody else could just read it. And I also, I don't know if you recall this, I also said take all of your content that's more than thirty or ninety days old and put it outside the paywall because the subscription would be supported by the news stuff that's old. Hey monetize it with average. So I think we took part of your advice. All the blogs were outside the paywall.

I think on a technical aspect that we weren't able to put the comments behind the paywall and not beyond the paywall, just allow subscribe. And then on the archive thing, we ran into a buzz saw because David Jones had a Factiva news service, which is very profitable thing, and you can't put those stories outside the paywall. You see this is this is one of the issues with any kind of a legacy media short right, you have these kind of entrenched uh um areas of interest, sometimes for

very good reasons. Some of them were pulling in millions of dollars of revenue. Sometimes it at very high margins and once you start threatening their business. I'll tell you about a really interesting website. It's called KSL dot com. So KSL is the NBC affiliate in Salt Lake City, Utah. Okay, it's just your ordinary NBC affiliate. Has to be run by coming called desiret News, which is m operated by

the Mormon Church. So they decided about ten or eleven years ago, or maybe a little bit longer, they can see that Craigslist was about to come to Salt Lake and because there are Mormons that they weren't too happy about Craigslist and the kind of standards. Since they did, they have since dropped the issues that were the problem, well, sex ads in the back and the prostitute. So what

I'm about to tell you is noel. Craigslist has no Craigslist has just gotten smarter about it, like they've they've from what I understand, so it's still there, it's just a little more yeah yeah. Um. But so KSL, which is a local TV news affiliate, said we're gonna start our own classified ad service, but we're gonna make it really good. You know, how much how much traffic that thing gets gets around two hundred fifty to three hundred million page views a month. Wow. Um. And they have

premium ads which they charge money for. They have this huge audience which they can monetize. How come nobody else has challenged Craigslist. That's a really good question because Craigslist is a really crappy experience. Well it's it's hasn't changed and has It feels like twenty years old, and it just feels kind of at least to me, it feels kind of icky. You know. Now, my daughter is just moving to Albuquerque. She's she's she's in her mid twenties.

She's Craigslist to find a couple of housemates. They seem like really nice kids. I mean, obviously most of the transactions have on Craigslist are fine, but the overall environment doesn't really isn't really that conducive. I would think to a lot of what people want to do in the classified ads work world. So I think a lot of what media companies have assumed, Oh you can't have a

good classified experience, you can't have a paywall. These are things that became part of the mantra that nobody really challenged them, and so it's it's times start challenging some of those. So clearly Washington Post paywall, New York Times paywall, bosting Globe paywall, New York Newsday out on Long Island paywall. So whoever said there's not going to be a paywall at a certain point when it's free and people would canceling subscriptions and droves that had to go away, I

think that was inevitable. I'm surprised so many people pushed back. It doesn't take You don't have to be a math. Gen used to say, all right, so we're gonna spend all this money creating content, and we're gonna give it away and we'll monetize it with band rads. That's not gonna happen. And even those days they were maybe ten dollar per thousand banner heads, you know, still not gonna pay. There was no projection you would ever generate enough traffic.

It was just you know, this blind faith that don't worry, it'll get better, or if we don't do this, we're gonna be outside the conversation. That just simply wasn't true. So now we have four pay journalism moving behind pay walls. But then we have the five thirty eight in the courts in the boxes. Is it they have they're all free? Do they have just a different cost structure or are they going to run into the same problem in a few years when when the VC funding drives up, are

they gonna have the same issue? So I think the cost structure is a really big piece of this issue. I mean, any newspaper these days has they saw printing presses. They still have trucks, a lot of them have unionized workforces, you know, and they still have to support the legacy part of the business because that still brings in seven or eight percent of the total at revenue coming back from from Laguardi. You see the New York Times printing area, it van Wick, it's this, it's a football field, an

aircraft hangar facility. It looks brand new. It's got a cost of millions, right, and then they got trucks going out every day, you know, with unionized drivers and stuff. Whereas you know, there's this website here in New York City called d n A Info, which is kind of a weird name for a website. It's actually getting a lot of traffic. They've had a lot of really good metro reporters from the New York Daily News. They've been

breaking a lot of stories. They do a lot of good neighborhood stuff, and they don't have any these legacy costs. So it's the structure. The model is that much cheaper. So so the guys who have run the projections on the eight and the boxes, Yeah, that's that's they should be able to make a run of it. Well, keep in mind five eight who owns five three eight? Right now?

Barry oh? ESPN? So you know ABC, esp the effective right if if if it loses a few million dollars here and there, it's a couple of quarters in the couch cushion, it's all those Uh it's Disney World is subsidizing. Yeah yeah, or ESPN. I mean ESPN is a huge cast. So you know, um, and Jeff Bezos has bought the Washington Post. He bought it for two fifty million, which I think one percent of his net worth. Right, you touch on something that's really interesting. Our big media outlets

eventually going to become trophy acquisition. And what was the Chicago paper, the Chicago Tribune who picked that up? Well, there was that whole unfortunate period with Sam's l who who you know, drove that truck right into the mountain, And now they're doing a spinoff where they're trying to extort a big dividend out of the new company. I actually actually wrote a piece for Representative Henry Waxman about it, right, said that the La Times was supposedly up for and

the only Time part. But but for example, take the Boston Globe, okay, so, which was formally owned by the New York TI exactly. So in the late eighties or early nineties, the Times paid one point one billion dollars for Oh my god, I think I think they sold it for fifty or seventy million plus. And actually I think that Times had to keep some of the pension obligations. Yeah, so, yeah, right, how do you lose a billion dollar? You know, it's like the old joke by Buffett, how do you become

a millionaire? Started with a billion dollars, then you buy an airplane. But so he sold it to John Henry, who owns the Red Sox and who's committed to local civic life in Boston, and he has a strong vested interest in in having a healthy newspaper. At least I hope he does. So the state of journalism is dependent on the altruism of billionaires, he says, sitting in Bloomberg's headquote World Right or some of the philanthropic efforts we've seen.

So Stoker's Pro pub because it was initially funded by Herban Marion Sandler, you know, from from the countrywide right or no, not country. Another mortgage company was the mortgage company I know who you're talking about, right, and they they just want a couple of Pulitzers. They I mean, they're doing amazing work. But Joe Eisinger's piece publishes both at Pro Publica and The New York Times, right, and they did the piece on the New Orleans hospital which

ran in the time. I remember that. So the Sandlers put up ten million dollars a year for a few years, and now it's a lot of money. I mean, it wasn't that much for them, but but I mean generally speaking, and now they're off raising money elsewhere or Pro public so so so the Sandlers, actually hurb Sandler's contribution has been diminished because they've been able to find other sources

of money. So effectively, one aspect of journalism is either find the sugar daddy or be fortunate enough to have someone set up a foundation. And isn't that going on with The Guardian in the UK? So, I mean, they're a wealthy they're a big foundation. They've done really well, well, they've just done really well. So they're run by the Scott Trusts, that's called and the Guardian has been losing money on a pretty a pretty regular basis. And the

Guardian has an amazing digital strategy. We actually were fortunate at the Journalism school to hire Emily bell Away because she was and I think at the time we hired her, the Guardian newspaper sold around three hundred thousand copies in their web audience was thirty million. That's amazing number. And

and that was five years ago. And from what I understand now, I was just on a panel Earli this morning with Heidi Moore, who writes for The Guardian, and she said their web Allian sounds forty is angry at me these days? I'm sure, I'm sure you'll make it up. But anyway, So, so the Scott Trust owned a lot of Auto Trader, which is this fantastically lucrative thing and he sold it for about a billion dollars recently, so that can be their endowment if you figure five investment

returned the fifty million dollars. And you know, at some point they'll get rid of the presses and they'll go to a pure digital operation. May not be you know, a time the next few years, at some point they will and you can run a pretty nice newsroom for fifty million dollars to say the least. So so the future of of media isn't completely hopeless, no, as long as there's wealthy people around to fundent. And we are seeing some business models emerging where media companies like The

Atlantic has a really lucrative kind of conference business. Uh. You see a lot of woll Street Journal does a lot of conferences business inside er is just into that area exactly. The f t oh, you know, we really haven't talked about great story. I love ft alphaville is. I love that that blog which is outside the fire the pay wall, but you know, from from our perspective, it's a relatively inexpensive pay but like the Wall Street Journal, it's really and expensive, so we sign up for that

as well. It's a really well regarded, well written paper, very credible, very thoughtful. Uh, and they break a lot of stories. But they were they were a little late to the game on the digital subscription strategy. But they really have when when you look at their digital subscriptions, they've really done well. Um they've got They're very smart about how to market it and and how to target the marketing campaigns to people who were reading story X

versus story Why. I have said it's got to be since Murdoch bought the journal, I have said the f t is really should be the business section of the Times, and if the Times was in a healthier situation, they should actually reach out. But they can't. My plan B is this guy buys The Times and then buys the Ft to fold into it, and then you have a really dominant global paper, both US and and continental. Well that would be huge. I don't know if it's gonna happen to anything. By the way, I give a lot

of free advice to billionaires. I don't know, because you know, buying a newspaper seems like such a smart strategy thousand fourteen. I don't know what they're thinking. It's not a business investment. It's a trophy exactly. The New York Times is a trophy The Wall Street Journal is a trophy. F T is a trophy, and obviously the Washington Post, where I have a column twice a month. Uh. And that's really why bizos. You know, you could have called me directly,

could have saved them a lot of money. But um, it's really the changing dynamics, so I know you have to go somewhere else. I want to wrap this up on a positive note. The future of journalism, the future of financial reportage and media. Is it going to survive in some healthy format or is it going to become this little thing that's off in the corner. I'm more confident about business journalism than really any other part of the journalism world because and we see this when I

was at W dot com. You know we uh, when I took over at W dot com have been around for about five or six years, they already had about half million subscribers. And why I left six years later, we had over a million. And you know, I'd like to say it is because of our great staff and how smart I was and all that, but the truth is people can see a direct relationship between paying for quality news, paying for quality business news and and getting something out of it. Right, now, is it just business

news that people who willing to pay for? Are they going to be willing to pay for? I think nonsins I think increasingly, as as people want to understand the world, as we have a more globally connected world, and as people realize that there's some relationship between the quality of journalists doing the work and the quality of journalism that you get out of them, that that there will be

increasing demand for it. Whether the demand will ramp up fast enough I don't know, but as you see, if you look at kind of any big business when it goes through some huge, gut wrenching transformation, there's a lot of the messiness along the way, and then eventually something emerges. And I think we're seeing some of that emerged now. And how long is it going to be before the unit a verse of of financial news in general media um is has find comfortable footing. How long do you

think this transitional period is going to be? Are we through the worst of it or is there still a lot more wrenching things to come. I think that we're in for a long period of of of this, because you know, there's a Columbia business professor wrote her book called the end of competitive advantage as about how barriers to entry fall as quickly as as you erect them.

I mean, in the old days, you would erect a barrier to entrying in in your business, and in the last five, ten, twenty years now, thanks to technology, as soon as you build it, somebody's out there trying to figure out a way around it. So I think what you need are journalism institutions that are much more nimble,

much more technologically adept um. We've started at the j School, at the Journalism School, training students in computer science and coding and data and algor of them because we want the next generation of journalists to be much more adept at this stuff, and to be much more pliable and flexible, and to have the kind of dexterity to deal with unending technological change. You know what, I would be remiss

and I know you have to run. I would be remiss if I didn't mention recode Mosburg right, the two technical Walt Mossburg is a legend at in technology at the Journal. That's just another example of no legacy costs. Launch a new model and immediately immediately hit the ground and and with traction and gained an audience. And it

also shows the power of individual brands. So if you're I don't know how many Twitter followers karro Switcher had at the time that she left out Jones and started her own business, but I'm sure it was in the hundreds of thousands. So when she went from the journal to her new business, she took those followers with her. In the old days, if we went from the Wall Street Journal to the New York Times, your readers state

at the Wall Street starting over. Isn't that interesting? And think about the kind of incentives that creates for journalists these days. If you can create your own audience, you can basically take that with you anywhere you go, and so that increases, you know, the incentives to do it, and it means that you have a lot more individual control over your career. And so the future isn't bleak for journalists at all. And the future of the media is going to be different than it is today. But

there's reasons for optimism. And you know, there's a lot of great stuff to read online. And when you think about you're sitting there with an uh your iPhone at the doctor's office and in waiting half an hour you're not reading you know, US News and World Report from four weeks ago, where readers digest from last month. You have access to literally thousands or millions of sources the world, the entire world. I mean, isn't that a good thing?

It isn't there something good about that? And you know, over time we will figure out how the businesses. We're always seeing some business models emerging. And opportunity to be able to sit at yourdentist's office and read the Johannesburg newspaper or listen to a radio station from Prague, or read your kid's blog all on the same device. There's something good about that. I think there's something fantastic about it. Well, that's an optimistic note we should end on. We should

always end on an optimistic That's right. I've been speaking with Bill Gruskin, formerly of the Wall Street Journal, now with the Colombia School of Journalism. Bill, thank you so much for coming. Thank you, bry. This was a lot of fun. Yeah, this has been great and we'll see you again next week. You're listening to Masters in Business with Berry rid Holts on Bloomberg Radio.