March 26, 2024

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πŸ€ Join me April 23 in NYC: Axios and Deep Blue Sports + Entertainment will co-host a groundbreaking Business of Women's Sports Summit.

  • Appearing on stage: Soccer star Megan Rapinoe, 3x WNBA champion Alysha Clark, Golden State Warriors president Jess Smith, USL Super League president Amanda Vandervort and many more.
  • Ticket and event info πŸ‘‰ here.

1 big thing: ⚑ Politics to pundit revolt

Data: Axios research; Chart: Thomas Oide/Axios

The furious response to NBC's hiring of former RNC chair Ronna McDaniel has triggered broader criticism of cable news' lucrative β€” and often controversial β€”Β alliance with former government and party flacks.

Why it matters: At a time when trust in media has hit historic lows, news networks are making a calculated decision to rely on ex-politicos as part of their fight for relevance and ratings.

Driving the news: Rachel Maddow, MSNBC's most popular personality, said last night: "I find the decision to put her on the payroll inexplicable. And I hope they will reverse their decision."

  • πŸ—£οΈ She followed a flurry of criticism from top talent at NBC News and MSNBC who have spoken out publicly against hiring McDaniel.

Reality check: The politics-to-pundit pipeline is deeply ingrained in both conservative and liberal media, Axios' Zach Basu and I write.

  • Multiple networks scrambled to sign McDaniel when she left the RNC last month, despite her role in former President Trump's efforts to block certification of the 2020 election in Michigan.
  • 🦚 NBC ultimately won and landed McDaniel on a $300,000 paid contributor deal. But it now faces an internal mutiny as several of the network's top stars publicly condemn the signing.

By the numbers: Dating back to 2000, more than half (16 of 31) of White House press secretaries and communications directors have gone on to become paid contributors, commentators, or hosts on news programs, according to an Axios analysis.

  • Ten of the last 14 press secretaries, whose role tends to be more public-facing, have joined TV networks after leaving government.

Zoom out: The White House has long served as a breeding ground for TV news talking heads, but the shift is happening faster and with less regard for formalities.

  • Former Clinton communications director George Stephanopoulos, who hosts ABC's "This Week," joined the network six months after leaving the White House in 1996.
  • Former George W. Bush communications director Nicolle Wallace, who today hosts a popular program on MSNBC, became a host on "The View" eight years after leaving the White House.

πŸ‡ΊπŸ‡Έ What to watch: America is splintering into more than a dozen news bubbles based on ideology, wealth, jobs, age and location, Axios' Mike Allen and Jim VandeHei write.

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2. πŸ“ˆ Truth Social goes public, trades as DJT

Data: Yahoo Finance, CHart: Axios

Donald Trump's social media company began trading today on the Nasdaq under ticker symbol "DJT" after its successful merger with a blank-check company.

  • DJT shares were up nearly 50% at midmorning before cooling to 36% just before noon ET.
  • Shares in DWAC, the blank check company Truth Social merged with to go public, spiked this year ahead of the anticipated IPO.

Why it matters: Truth Social's listing could eventually become a financial windfall for Trump, who owns tens of millions of shares. His share is currently valued at $3.9 billion, Axios' Dan Primack writes.

  • Yes, but: Trump either must wait six months to sell or get special permission from the board to sell earlier. Either move is tricky because it could tank the value of his remaining holdings.

The big picture: Using Trump's initials is both appropriate and with precedent.

  • Truth Social is dominated by Trump and Trump-related content, including campaign ads.
  • Trump previously used "DJT" as the stock symbol for one of his hotel and casino companies, which filed for bankruptcy and was delisted.

The bull case: MAGA fans will buy and hold the shares out of political loyalty. Their own version of GameStop.

The bear case: It's a lousy business, with far fewer users than social media rivals and losses outpacing revenue. If this were being valued on the fundamentals, there wouldn't be much value.

What to watch: Meanwhile, Reddit's IPO is off to a good start. Shares in the social network popped this morning on momentum around DJT. They were up around 30% since its public market debut last week.

3. Gannett CEO bashes union: "Plays dirty and lies to our employees"

Illustration: Rae Cook/Axios

Gannett CEO Mike Reed didn't mince words when asked in an onstage interview last week how he's dealing with an uptick of union activity and pressure.

  • "I think the Guild, unfortunately, plays dirty and lies to our employees," Reed told Axios at the annual Mather Symposium on media in Atlanta.

Why it matters: Reed's comments β€” hotly disputed by union officials β€” are perhaps the strongest on record by a major media executive about dealing with union activity, but other news management teams face similar tensions.

Details: Asked to clarify ways in which the union lied, Reed said the Guild told employees that the company is using profits to buy back shares of stock and that the company is only cutting jobs to increase profitability.

  • In 2022, a Guild release inaccurately described the company's authorization to buy back shares as a repurchase of the shares, a Guild spokesperson said, but soon after corrected the error.
  • Reed also accused the Guild of lying about the company cutting jobs "to increase profitability." He said that's not true β€” "they're designed to keep a newsroom in the market itself."

Between the lines: Gannett has cut more than half of its workforce since the GateHouse merger, which has led to an uptick in union activity and tensions.

  • Yes, but: Reed said Gannett is "near the end" of major job cuts and claimed the company has hired 500 people in the last 12 months.

πŸ—žοΈ Zoom out: Reed's comments come as the company pushes to drive more revenues from digital products.

  • Last week, Gannett and McClatchy both announced they would stop licensing content for syndication from the Associated Press, a major shift for both newspaper giants that together reach hundreds of local markets.
  • Reed said it was a coincidence that both chains' announcements came at the same time. Gannett made its decision a while ago, he added.

Reed said AP stories were "the least performing content" across Gannett websites and platforms, which is in part what fueled his decision not to renew the license when it expires at the end of the year.

  • What to watch: Reed said Gannett would continue using the AP's data in its election coverage this cycle, but is undecided for future cycles.

Go deeper.

4. The Messenger CEO hasn't ponied up

Illustration: Allie Carl/Axios

It's been six weeks since The Messenger founder Jimmy Finkelstein alluded to considering options to help the hundreds of employees who were let go abruptly in January without severance when his startup folded, but former staffers say they've heard nothing from Finkelstein, assuming it was an empty promise.

Why it matters: Finkelstein could have closed The Messenger sooner and used the remaining cash to pay out his 265 employees, many of whom had severance payments guaranteed in their contracts.

Details: In recent days, former employees received a package in the mail with information explaining that the company was placed into a Delaware-based trust to liquidate any remaining assets.

  • Creditors and employees have been instructed to submit claims by the end of April.
  • The assets will be divided according to a "priority scheme" that has out-of-pocket costs related to the Trust's assets, including administrative expenses, be paid out first, followed by expenses related to the Trust itself (compensation for lawyers, etc.) and then severance payments to employees. It's unclear, however, how much money, if any, remains.
  • πŸ’° No former employees have received any sort of payouts or assistance so far. Some still have access to their Messenger email accounts.
  • Finkelstein did not comment.

What to watch: Some former business executives have since sued to fight for their money in court.

5. Exclusive: WNBA likely included in ESPN's NBA rights renewal deal

Jimmy Pitaro speaks during Axios' What's Next Summit on March 19. Photo: Ronald Flores for Axios

ESPN chief Jimmy Pitaro expects the WNBA to be part of a media rights renewal deal with the NBA, he told me at Axios' annual What's Next Summit in Washington, D.C., last week.

Why it matters: The WNBA's 2023 season was its most-watched in more than 20 years and is part of a larger boom in women's sports.

  • πŸ€ Pitaro said he sees both the NBA as "ascending" and attracting younger audiences β€” perhaps even more so with the WNBA.

The big picture: The WNBA is primed for a major increase from its current TV deals, which are worth around $60 million in total annually.

  • Momentum around NCAA superstar Caitlin Clark could bolster the WNBA's negotiating power, Axios' Tim Baysinger writes.

🏈 What to watch: Pitaro also confirmed to Axios on stage last week that ESPN has signed a six-year extension worth $7.8 billion to remain the sole TV partner for the NCAA's top football playoff tournament.

Go Deeper: Sign up for Axios Pro Media Deals authored by Tim and Kerry Flynn.

6. Scoop: More media layoffs

Illustration: Natalie Peeples/Axios, the media company founded in 2016 by longtime media entrepreneur and tech investor Jason Calacanis, has laid off roughly three dozen staffers as a part of a broader move to eliminate its advertising team, a source told Axios.

Why it matters: Calacanis has a long history of building media companies. But today's ad market has proven brutal for even the most sophisticated media and tech entrepreneurs and investors.

Details: Inside is moving away from its advertising model, and "some positions were eliminated," Calacanis confirmed to Axios when asked about the cuts.

  • The firm is reorganizing around a new product that will launch at the end of the year, Calacanis said.
  • president Alex Medick posted cryptically on X last week that "Something is brewing...." and linked out to a survey asking readers about how they like to consume news. On Sunday he posted, "Startups are hard."

Catch up quick: Calacanis launched as an online community for professionals that includes curated news, content and social networking.

  • The company raised over $700,000 via a community fundraising platform in 2021.

The big picture: Silicon Valley titans have long pushed to create their own media properties, with mixed success.

  • Andreessen Horowitz's content site Future quietly shuttered in late 2022.
  • Clubhouse, which is backed by prominent venture firms, laid off half of its employees last year.

7. Evan Gershkovich has spent a full year in prison

U.S. journalist Evan Gershkovich, arrested on espionage charges, stands inside a defendants' cage before a hearing to consider an appeal on his extended pre-trial detention at the Moscow City Court in Moscow last September. Photo: Natalia Kolesnikova/AFP via Getty Images

Friday marks the one-year anniversary of WSJ reporter Evan Gershkovich's wrongful detainment by Russian authorities. The 32-year-old U.S. citizen was arrested on March 29, 2023, for espionage charges that both he and The Journal vehemently deny.

Why it matters: Gershkovich is the first U.S. journalist to be arrested and held on spying charges in Russia since the Cold War.

  • His arrest has sparked outrage amongst press freedom activists who worry Russia is using his detainment as a bargaining chip with the U.S. over its war with Ukraine.

Driving the news: Gershkovich appeared in the Moscow City Court this morning, where his pre-trial detention was extended for the fifth time until at least June 30.

State of play: The U.S. government has been negotiating with Russia to get Gershkovich out via a prisoner swap, but efforts to release him and marine veteran Paul Whelan, who is also being held on espionage charges, have come up short.

What's next: The Journal has assembled a slew of programs to call attention to Gershkovich's case this weekend, including a global run across 12 cities, a 24-hour read-a-thon, social media blitz and more.