TechCrunch Does Not Appreciate Your Implication That Having an Editor Who Invests Heavily in Tech Companies Is a Conflict of Interest

By
Michael Arrington. Photo: Noah Berger/Bloomberg via Getty Images

Last week, AOL found a new way to plumb the depths of new media controversy by witnessing (and supporting) TechCrunch founder Michael Arrington as he founded a fund to invest in tech companies. The new venture is called CrunchFund, and its largest investor is AOL itself. After substantial back-and-forth on what this would mean in terms of conflicts of interest, AOL editorial boss Arianna Huffington told the Times that Arrington would no longer have any editorial control of TechCrunch, a hugely influential blog, and would merely serve as an unpaid writer whose investments would be noted when appropriate. Yesterday, media columnist David Carr lashed out at the whole kerfuffle, writing: "It’s not the usual case of conflict of interest — someone being sent a shiny new gadget and writing about how spiffy it is. This time, there are tens of millions of dollars in play. Coverage in TechCrunch can make or break a start-up, and what about those companies that are not F.O.M.’s (Friends of Mike)?"

From Carr:

As business reporters, we are often pressed up against the glass, watching as others take risks, make investments and build companies. We are observers, not players. But the froth and money sloshing around has reached a whole other level, and looks enticing no matter what side of the glass you are on. Michael Arrington kicked a hole in the glass.


Yesterday and today, TechCrunch has spoken up to defend itself. On his personal blog, Creative Director MG Siegler observed that even though Arrington is/was everyone's boss, that didn't actually mean anything:

Instead of a reliance on top-down management and editing, the emphasis is on hiring the right people. TechCrunch works because we’re a bunch of driven reporters with great instincts that excel at working independently. Sometimes junior writers hone those instincts by watching senior writers and asking questions. And there is plenty of good, healthy collaboration. But for the most part, it’s very a much a trial by fire — only the strong survive ... Titles do not matter at TechCrunch. If they did, I would have petitioned to be “Super Ultra Editor Supreme” long ago. Instead, my business card reads “Creative Director” (hopefully I don’t have to explain this). And my TechCrunch profile reads “Kick Ass Pool Party Coordinator”.


The point being that Arrington doesn't influence the coverage of others (so much so that it might be a problem that writers wouldn't disclose his investments because they simply didn't know of their existence). Siegler argues that the Times and other legacy media tut-tutters are naive and informed by their old-fashioned notions of "editor" and "writer." His post was called "It's Not a Mirror, It's a Crystal Ball."

Back on TechCrunch, Siegler lamented Arrington's semi-ouster once again. "TechCrunch is on the precipice," he wrote. "The notion that Mike, or anyone else, investing in a company would dictate some sort of giant conflicted agenda is laughable. Literally. If Mike tried to get me to write some unreasonable post about a company he had invested in, I would laugh at him."

But the problem with this argument is twofold. First, perception does matter, as TechCrunch writer Paul Carr (no relation to David) seems to understand. Instead of citing TechCrunch's "different standards" in his defense, Paul argues Arrington should have said this:

“Despite the name — which in hindsight was a bone-headed choice — it’s important to understand that ‘the CrunchFund’ is a simply an extension of Mike Arrington’s existing angel investing activities. None of the writers and editors of TechCrunch has any influence over, or stake in, the fund and hopefully it goes without saying that it will have absolutely no impact on the day to day editorial independence of TechCrunch.”


The second problem is that at the same time that the Times may be acting naive here, it's hard not to see that TechCrunch is too. The Gray Lady's been in business for some 160 years. That's not to say they've perfected their ethics, not by a long shot — but it's worth pointing out that in that time they've learned the thousands of subtle and almost imperceptible ways that conflicts of interests can work. It's not so simple as an editor who has an investment openly ordering a writer to publish a puff piece. What's "laughable" about that interpretation of a conflict of interest is how simple it is. If Michael Arrington is viewed as the creative soul of TechCrunch — which has been made clear in the posts coming to his defense over the past few days — there is literally no limit to the creative ways in which he might use his influence as an industry observer to effect his own interests. As Siegler himself points out, about Arrington, "You might not think you’ll miss what he brings, but you will. Quite often, you never even see what he brings. But it permeates the entire site."

This won't be the end of TechCrunch — there are too many gifted writers and editors there for that. But it would be good if this current mess could be used as an opportunity for legacy media and innovative new media outlets to make a bigger effort to understand where the other side is coming from, rather than firing defensive potshots in all directions.

It's Not a Mirror, It's a Crystal Ball [Paris Lemon]
Michael Arrington's Audacious Adventure [NYT]
The CrunchFund: Actually, Tim, We Don’t All Have “Different” Standards [TechCrunch]
TechCrunch As We Know It May Be Over [TechCrunch]
Earlier: Michael Arrington Is Starting His Own Venture Capital Fund With AOL’s Blessing (and Money)