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Money and the Web

Monday, October 2, 2000 by Dave Winer.

The Paper Permalink to The Paper

A few days ago I saw The Paper on cable, starring Michael Keaton, Glenn Close, Marisa Tomei and Robert Duvall, about a trashy NY newspaper with more integrity than anyone thought they had.

A great story told by Duvall, which might have meaning for Web people. When he was young reporter covering the Olympics in Grenoble, at the end of the Olympics, a bunch of reporters went to a fancy restaurant to celebrate. More people joined the party. When the bill came it was $9,000.

They went into a panic, arguing, trying to figure out who invited who, when an old man seated at a nearby table waved his hand to a waiter, asked for the bill, scribbled a picture on it, and handed it back to the waiter. The man was Pablo Picasso. (Of course a Picasso drawing was worth more than $9K.)

Close asks what this has to do with her demand for a raise. He takes a deep breath and says, paraphrased in Dave-speak: "We get to hang out with the rich people, but we don't make the money. We never have and we never will."

Another key line, from the lovable curmudgeon, played by Randy Quaid, goes something like this. "Sure we're a trashy paper, we run 8-inch one-word headlines, we put pictures of severed bodies on the front page, but this is the first time we've run a story we knew wasn't true." That wakes up Glenn Close, the managing editor, and even though she has a bullet in her leg, she stops the presses, and they get it right.

And yes, at one point they do say "Stop the presses."

Money and the Web Permalink to Money and the Web

A lot of what you read on the Web is motivated by money.

In my humble opinion, many stories are known not to be true by the people who write them.

Here's how it works. An analyst goes to a meeting with a vendor, hears the pitch, asks questions, listens to the answers and forms an opinion. The vendor listens carefully to the tone of the questions the analyst asks. If they get a sense that the analyst wants to play ball, the question is popped.

"Would you like to be on our advisory board?"

Translated: "Would you like some stock?"

The Chris Nolan episode at the SJ Merc opened the door for an industry-wide house-cleaning, which never took place. There are people who call themselves journalists and write stories that appear to be conflict-free, but are highly conflicted, and the conflicts are often not disclosed.

To my readers, I have received these offers and so far, I've turned them down. On the other side, I've had analysts ask to be on UserLand's advisory board (we don't have one), and when I pressed them to explain what that meant, I was told that they get stock. Now, it's flattering to have stock that supposedly objective analysts want, but I didn't go for it.

Refer back to the Duvall story. If you take the money is it inevitable that you'll write something, at some time, that you know is not true? Is this the line between commercialism and journalism?

I hope my interests well-known Permalink to I hope my interests well-known

Along with a small number of CEOs (mostly in the weblog community), I write publicly on a daily basis, and accept some of the limitations of being a journalist. I keep my money in mutual funds and real estate, I don't make personal investments in the companies I write about. I own a lot of UserLand stock and some Critical Path stock that I got when a company I invested in in the late 80s was acquired by them. The mutual funds are blue chips, not tech stocks.

I'm not playing the stock market, I've got my interests out in the open, and relatively simple. When I point to something that UserLand is doing, I benefit if you think it's cool. I point to competitors when appropriate, but lately I've not been doing that when they don't reciprocate. (There's a conflict of interest, disclosed.)

Oy such problems! If everyone were riding the Cluetrain, it would be easy. But it's not so, imho.

The Cluetrain is two-way, again Permalink to The Cluetrain is two-way, again

As long as I've been reading newspapers and magazines there has been a presumption of integrity on the journalists' side, and a presumption of lack of integrity on the vendors' side. I've always found this puzzling, probably because I practice a business that's more of an art, software development.

Many years ago I realized that without integrity there is no software. "You can't lie to the compiler." So I've sat out many hype balloons, even taken shots at them (to no avail) and gotten flamed for doing so, imho by people with a not-so-great appreciation for integrity.

If it's wrong for a journalist to take a bribe, it's equally wrong for a vendor to give one. Integrity matters. I think that's the clue of the Cluetrain. Again, it's a two-way thing. It's impossible to be a high integrity vendor in a world where journalists have sold out, and where other vendors don't play with integrity.

It's even more complex Permalink to It's even more complex

Now, this may sound horribly complex, but it's even worse than it appears. As the CEO of a software company, I make bets on other company's strategies all the time. I generally write about the relationships. This is often to the detriment of my company, because it allows our competitors to form relationships with the same companies we form relationships with; and further it limits the companies we can partner with to companies that don't mind if the relationship is discussed publicly.

An example, in April, our primary ISP, Conxion, cut off UserLand when I criticized them on Scripting News, after years of gushing about their great service. When the service turned bad, something I promised I would watch for (they welcomed it at the time), I wrote about that too.

I strongly believe if they had worked with us they would be offering better service to their customers now, but they chose to disconnect us, and that came at a very bad time for my company (even with the benefit of six months hindsight). We were getting ready for a user's conference, shipping a new product, and getting ready to announce SOAP 1.1 with Microsoft, IBM and Developmentor. As the Scripting News readers know, I got quite angry with Conxion's inattention to the problems. I haven't written about this in this column, until now.

Now I respect confidential information, but public information is another story wholly. Our users knew we were having problems because there were constant outages. There was no way to sweep it under the rug. I can't lie about it, when we lost our connection, their sites went off the air too.

The other side Permalink to The other side

Now, this piece is certain to draw a response from Conxion. I want to show respect for their point of view, and also show that I listened to what they said.

Conxion said that the problems were with PacBell's service, not theirs; and that reliable service could not be delivered to the location we were operating out of. Further, they had been operating our line at a loss, and had discussed cancelling UserLand's service internally before the March-April outages. Conxion people pulled out all the stops to keep UserLand on the air while we switched ISPs.

And my counter-point. First, the people of Conxion *are* fantastic professionals. They accepted the decision of their CEO, but they also kept us on the air as we struggled to find a hosting service we could work with. Without that commitment to service, our users might have lost their connectivity for weeks or months. They were a total inspiration.

Our bandwidth requirements were going up, that much was clear from Conxion's view of UserLand. Between December, when the outages started, and March when we were going off the air regularly, we added thousands of new sites on our servers. What Conxion missed, imho, are the people. Each of those sites had editors and readers, people who depended on our service, as we depended on Conxion's. When they shut us down they were shutting down lots of sites that had no opinion about them.

Further, the way Conxion handled this raised questions about *my* integrity and that's totally not cool. Did they think they were buying praise from me? Nothing could be further from the truth. Yet they responded as if I had breached their trust. Hey, I was just telling the people what was going on, from my point of view, and that's all. When the service was great I said so. When the service was bad, I said that too.

BTW, we switched to Exodus, and so far, everything's fine. But if it goes bad, we'll talk about it. When we signed on with them, I sent email to Ellen Hancock, their CEO, giving her a heads-up that this could happen.

Partners and customers Permalink to Partners and customers

If one company chooses to disclose its process publicly, as UserLand does, all companies they work with accept a similar choice. It's kind of viral. It's a change in the way we do business, brought about by the Web.

With better communication between users and vendors, when our services fail, there's no place to hide, for anyone. There are lots of other examples. Apple is struggling with their fan sites about publishing information about upcoming products. There are no easy answers to these issues, but integrity must be the starting point.

Customers legitimately ask us to disclose our plans, it's in their interest that we do that, but it's not always in our interest. When we tell people what we're developing, we also tell our competitors. We could also be undermining our current products. And sometimes our priorities shift, so until a feature is released, we're totally unsure when or if it will ship. Yet this is what the customers demand to know.

So it's hard to stay direct and tell the exact truth. It's getting more difficult as the market shapes up. I can see where we've paid a price for what I see as integrity, it's something I am thinking about. The only way to do that, for me, is to write about it publicly.

Dave Winer

PS: ISP stands for Internet Service Provider. Imho stands for In My Humble Opinion. BTW stands for By The Way. CEO stands for Chief Executive Officer.

© Copyright 1994-2004 Dave Winer. Last update: 2/5/07; 10:50:05 AM Pacific. "There's no time like now."