Journalism’s Wild Ride and the End of Buzzfeed News - TPM – Talking Points Memo:

The demise of this high-flyer certainly isn’t about the quality of the work of the staff who worked at Buzzfeed. Peretti, wisely avoiding an incautious and damaging comment, told staffers it was “clearly a massive failure on my part and I am deeply sorry for it.” That is good of him to say. But this is fundamentally a story about the arc of social media which first provided tech-savvy publishers a distribution bonanza and then slowly starved them of revenue as the same platforms engrossed greater and greater shares of the ad revenue publishers have traditionally relied on. That’s the story and Buzzfeed is just one of endless numbers of publications that rode the same arc. They just flew higher. With Peretti they had a particular handle on working the algorithms. They were all riding the tides of speculative bets made by a handful of venture capital firms — but often, in the case of the people who made up the bulk of the organizations, without knowing it.

These were speculative business ventures in which a good chunk of the journalism world was basically along for the ride. Those of us deep in the nitty gritty of making journalism produce more dollars than it costs could have told you at any point that none of these places were making money – whatever the BS press releases said. There’s a strongly exploitative element of this. People didn’t get quite what they were in for. But we should also recognize that while the getting was good we actually got a lot of really good journalism out of it. The key point is that these were gambles at the intersection of telecommunications, media and technology.

As usual, I agree with Josh.

I guess I just don’t understand how people can look at decades' worth of bubbles caused by billions of excess dollars being poured into this or that sector or fad only to have the whole thing blow up in their faces, and say that “The market is working.”

During the heights of the first tech bubble in the late 1990s and early 2000s, I remember reading the hundredth article about Pets.com’s ad buys, or some web startup that had just bought a million dollars' worth of Herman Miller Aeron and thinking to myself that these places were fooling themselves and the market. None of them were making any money; they were getting tons of investment and mistaking it it for profit. Like, “They’ve got all this cash, so they must be doing well!”

It call came crashing down pretty soon after that. We have gone through several more of these cycles since then (and seem to be hitting another one now), and yet no one seems to have learned anything from any of it.