Ben Thompson in “Peter Thiel, Comic Book Hero“:
The most obvious second-order effect is that, as Felix Salmon writes, Thiel is providing a blueprint for the suppression of the press by the wealthy. But what concerns me — and what ought to concern Thiel, and all of the Silicon Valley elites celebrating his actions — are the third order effects. Specifically, Thiel’s actions are bringing into stark relief the fundamental weakness of old analog businesses like journalism relative to the incredible power and strength of the technology sector, and if companies follow Thiel’s example, the freedom that makes the emergence of said companies possible could quickly come under threat — and deservedly so.
Consider Facebook: I have argued strenuously that the idea of Facebook consciously abusing its unprecedented power over what people see is absolutely a problem in theory, but one that is contained by Facebook’s own incentives and the fact that the alternative — government regulation of speech — is even more undesirable. At the same time, I am troubled by the societal impact broadly of Facebook’s efforts to be neutral via algorithm and the potentially destructive impact that has on our politics in particular. What is truly alarming, though, is the prospect of a company specifically and an industry broadly that is convinced of its own righteousness, unconscious of its own power, and blind to what it doesn’t know making decisions with unintended consequences — like outing LGBTQ people at scale.
Gawker could continue to fight the Hogan case; it could even win that case outright, on appeal. But even if Hogan went away, Thiel would not. Thiel’s lawsuits would not end, and Thiel’s pockets are deeper than Denton’s. Gawker’s future is indeed grim: it can’t afford to fight an indefinite number of lawsuits, since fighting even frivolous suits is an expensive game.
The result is that investing in Gawker right now is a very unattractive proposition, since any investor knows that they will be fighting a years-long battle with a single-minded billionaire who doesn’t care about how much money he spends on the fight. And if Gawker can’t raise any new money to continue to fight the Hogan case, then its corporate end might be closer than anybody thinks.
Scary. And this is going to backfire in a big way.
