As Investors Circle, Organized Labor Moves Into Digital Media

This is interesting.

At WSJ, "Vice Media’s recent move is part of a broader unionization push at outlets as the industry also seeks investments":

Earlier this month, when writers at Vice Media were emailing about the potential benefits of unionizing, one employee brought up company co-founder Shane Smith’s purchase of a $23 million mansion in Santa Monica, Calif., a house featured in “Beverly Hills Cop” and the HBO show “Entourage.”

“For next time [management] says they can’t afford to give us raises,” the employee wrote, posting a link to an article about the real-estate deal.

Two days later, on Aug. 7, the writers voted to join the Writers Guild of America, East.

The move at Vice is part of a broader unionization push in the digital media world. This summer, the WGA and another union, News Guild-CWA, have also signed up writers at Gawker Media and Salon.com, and say they’re actively trying to make inroads elsewhere.

As online media outlets grow in heft—generating significant revenue and earning eye-popping valuations in investment rounds—their workers are beginning to argue they deserve better compensation and employment protections. Vice, whose edgy brand of online content and TV has caught on with young audiences, is a new-media powerhouse that was valued at $2.5 billion in its last investment round.

But the labor organizing movement is happening at what is arguably the most inopportune moment for the industry, just as it is attracting attention from strategic investors who can inject a huge amount of capital into their fledgling businesses. Big media companies are scouting the space aggressively as they chase young audiences, and while unions won’t necessarily be a hang-up in deals, they won’t be a selling point.

Skeptics say collective bargaining may not make sense for these companies, and could counter some of the advantages they have over traditional newsrooms, such as nimble decision-making, flexible work roles, and, in some cases, a lower wage scale.

“It raises questions about the extent to which a union contract might encumber a company from being able to make rapid decisions,” said Iliya Rybchin, the director of the media and entertainment practice at venture capital firm Highnote Foundry, which isn’t an investor in any of the unionized companies. “With unions you also often have strong delineations about roles, and in young companies you usually want a lot of fluidity.”

Management at all of the new-media companies that have voted to unionize have recognized and accepted the decisions of their workers.

One investor who has been on the board of several digital media companies—none that have unionized—said the collective bargaining movement is a bad idea. “For a fast-changing, dynamic, tech-led industry the last thing you want are barriers to growth,” he said, adding that unions have “been a weight” on traditional newsrooms...

I suspect unionization's a really bad idea. But then, most of these outlets are on the far-left. We'll see.

But keep reading.