BuzzFeed’s Matt Zeitlin dives deep into Chrystia Freeland’s role in the Reuters Next failure.
Granted, this piece has a distinct rats-fleeing-the-ship feel to it and there’s not a single on-the-record source in it, but Freeland didn’t help the situation, either, telling Zeitlin she wouldn’t talk to BuzzFeed unless it was to a top-level editor. Perhaps she’s spent a wee bit too much time at Davos.
Most interesting here is BuzzFeed’s reporting that Freeland and Reuters Next, which ran through $15 million to $20 million, didn’t bother with a revenue model.
“Monetization was not the priority, the priority was building something for the brand”…
According to sources close to the project, Freeland had never seen Reuters Next as an advertising play — one Reuters source said that she “made very little effort to ensure ads would work on the site” — and when it became clear ads had to be worked into the project, there were difficulties.
“I don’t understand what they were thinking, ‘Let’s not run any ads, let’s spend millions and see what happens.’ The idea that it had to be monetized caught them by surprise,” the Reuters employee said.
Instead, sources said Freeland’s focus was on the brand and “beating the AP,” and no so much to worry about advertisements being prominently placed or being at the forefront of the design process. This meant it was very difficult for the sales team to sell Reuters Next, as designing and standardizing ad units was not a focus of the project.
Is this Silicon Valley or is this the new business in 2013?
This fiasco can’t be good for Freeland’s campaign for parliament. It’s certainly bad for Reuters.
— The Associated Press scoops settlement talks between the Justice Department and crime-ridden JPMorgan Chase on mortgage securitization fraud. This is a huge deal: The number being bandied around is $11 billion.
The Journal reports that DOJ has used the threat of criminal charges against the bank to talk it up from the bank’s previous offer of $3 billion. Hey, maybe Holder & Company are finally learning.
As large as the potential settlement may be, two people cautioned that even if a deal is reached, it may not resolve one of the biggest dangers for the bank: the potential for criminal charges stemming from the mortgage-backed securities probe. The possibility of such charges is a key incentive for the bank to try to cut a deal, but also one of the most difficult issues on which to reach an agreement, according to the two people familiar with the discussions…
One scenario under discussion would include a $7 billion cash penalty plus $4 billion in relief that J.P. Morgan would provide to consumers, one of these people said.
Authorities have been investigating whether J.P. Morgan, which acquired Bear Stearns and Washington Mutual during the financial crisis, misled investors about the quality of the underlying mortgages that were tied to the securities. Many of those securities collapsed in value as housing prices eroded. J.P. Morgan has estimated that roughly 70% of the securities involved were issued by the other two institutions.
As usual with these things, don’t believe it till you see it. And unless the DOJ claws back money (or heaven forbid, charges them criminally) from the bankers responsible for the fraud, they’ll escape unharmed, while the bank’s shareholders foot the bill. It’s obviously fair for shareholders to get hit, since they own the bank, but it’s not fair to let the actual fraudsters off the hook.
— Reuters is good to call out Walmart’s “Made in America” initiative for the meaningless marketing campaign it really is:
But an examination of the company’s “Made in America” campaign suggests Wal-Mart’s caught on to a reshoring phenomenon that was already underway.
In many cases, Wal-Mart’s suppliers had already decided to produce in the United States, as rising wages in China and other emerging economies, along with increased labor productivity and flexibility back home, eroded the allure of offshore production.
Though wrapped in the stars and stripes, the world’s largest retailer’s push to bring jobs back to the United States also makes business sense both for suppliers and retailers.
Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at email@example.com. Follow him on Twitter at @ryanchittum. Tags: BuzzFeed, Chrystia Freeland, JPMorgan Chase, Reuters, Walmart