Alden Global Capital has for years been lambasted as the journalism industry’s “grim reaper.” The hedge fund, which owns some 200 publications including such stalwarts as the Chicago Tribune and Orlando Sentinel, follows a pretty simple formula: Buy the depressed asset, strip it of its parts, and extract value—all at the expense of the newspapers, and by extension, the communities they serve. In this era of widespread instability in the media sector, Alden-owned newspapers stand out for cutting their staff at twice the rate of their competitors, according to a 2018 study by University of North Carolina researchers. Which is why there’s a grim irony to the fact that Alden could now be the industry’s best hope for staying solvent in the AI era.
The hedge fund filed a lawsuit this week against OpenAI and Microsoft, alleging that both use millions of articles, for which Alden owns the copyright, to train their respective LLMs. The suit follows much the same argument as one filed in December by The New York Times Company against the same two companies. “We can’t allow OpenAI and Microsoft to expand the Big Tech playbook of stealing our work to build their own businesses at our expense,” Frank Pine, executive editor of the newspapers owned by Alden Global Capital, said in a statement.
Maybe what comes from this is a licensing agreement not unlike the one OpenAI just struck with the Financial Times, the Associated Press, or German and French outlets. But some suggest it could usher in a flurry of new suits, leading to better payouts and a sharp reminder to the AI industry that they can’t cheaply buy off the media sector.
“[Alden] is pretty sophisticated in terms of ringing maximum value out of any situation,” says Emily Bell, professor and director of the Tow Center for Digital Journalism at Columbia University. “This is just one of those examples where being perhaps a bit more cutthroat in the business world may, ironically, play out in a way which is slightly better for journalism because it’s seeing this as a hardball value negotiation, rather than rolling over and saying, ‘Oh, isn’t it great to do a deal with an AI company,’” she says.
Alden is also unusual in that it’s one of only two major media-owning firms (alongside the New York Times) that are taking OpenAI and Microsoft to court. Executives of other media firms are likely watching with interest, according to Bell.
“I’ve been surprised at the speed with which a group of pretty large publishers in Europe have signed big deals with OpenAI and will probably be signing similar deals with Google,” she says. “It does seem as though they’ve taken a calculated decision that, whatever the long-term impacts or unknown outcome of generative AI are, that it is worth banking the money upfront, while it’s still on the table.”
But in inking those deals, there are concerns that more established media names are sweeping the cash off the table while they can and leaving none for the smaller outlets. Certainly, the way in which higher-ranking publications (with the exception of the Times) have been willing to take Big Tech’s cash has been a shock to Bell, in part because she believes that the industry can play a stronger hand together. That decision has been typified by the licensing agreement OpenAI recently struck with the Financial Times. “One of the things that has disappointed me a bit is that there isn’t much coordination among publishers,” says Bell. “It feels like it’s creating more path dependencies and also slightly widening that chasm between the haves and the have-nots in publishing.”
Which is what puts Alden in the role of hard-headed negotiator willing to take on Big Tech. It’s also in a better position than most because it’s flush with cash, given that it’s a hedge fund.
Now, Bell is skeptical that Alden would put much, if any, of the money it won from a lawsuit against OpenAI and Microsoft into its newsrooms, that if Alden manages to win its case against OpenAI, or to land a hefty settlement in exchange for dropping its suit, that money will go back to where it’s needed. “What the hedge funds will do is extract money from the OpenAIs of this world, but I don’t think for two seconds they are going to return it to their own journalists,” she says.
But even so, there would at least be a precedent—and a blueprint for other newsrooms to take on the AI giants. “If that court case succeeds, and if the Times’s court case succeeds, then you probably do actually have a real opportunity for smaller publishers who were perhaps worrying about taking on these extremely wealthy companies,” Bell says. “You probably have a clearer path they can follow to get some kind of value out of it.”
Login to add comment
Other posts in this group
Ever since DeepSeek burst onto the scene last month, there’s been no short
Nowadays, when you hear someone talk about faxing, there’s a decent chance it’s the punchline to a groan-inducing dad joke. (Not that I would ever be guilty of such silliness, of course.
Amazon has agreed to pay nearly $4 million to settle charges that the e-commerce company subsidized its labor costs by taking tips its 
It’s game time for Meta’s wearables: The tech giant has bought two ad spots for its Ray-Ban Meta smart glasses during Sunday’s Super Bowl broadcast, including one that has Chris Hemsworth and Chri
If you scroll through your old photos from the mid-2010s—the golden era of Snapchat—chances are a fai
OpenAI is scouring the U.S. for sites to build a network of huge data centers to power
