How Vice found its news niche and built a media empire
(This story originally appeared on Timeline.com on May 16, 2015)
It isn’t often that a new brand joins the ranks of major video news providers like CNN and Fox News, the shared eyes and ears that connect millions to the rest of the world. But Vice is doing it with a growing empire of news sites, YouTube channels and deals with other media companies.
From its early days as a punk zine, Vice has built and kept credibility among a younger demographic, and other companies have paid them handsomely for a slice. Now they’ve become a competitive news organization, producing risk-taking reporting from places and scenes that others won’t visit or aren’t cool enough to know about.
Here’s how Vice found its way into a gap that television news had created over decades.
TV news begins as a money-losing public service
1949—Washington, DC
When the Federal Communications Commission granted the first television broadcasting licenses to NBC, CBS and ABC, they treated the networks as public trustees. For the “big three” to make money from ads and entertainment, they also had to produce high-quality news. Network news operations needed to actively seek important stories and present opposing viewpoints, even if the operations lost money, which they all did.
This “Fairness Doctrine” didn’t survive the Reagan era’s wave of deregulation. By 1985 the FCC was saying that it might violate free speech. It dissolved it in 1987. Congress has since tried to restore the requirement, but presidents Ronald Reagan and George W. Bush vetoed it.
‘60 Minutes’ makes TV news a money game
1968 — New York City
For decades, because newscasts were expected to lose money, news desks worked without the constraint of having to be profitable. Then Don Hewett at CBS launched 60 Minutes, a “news magazine” based on the Canadian newshour The Hour Has Seven Days. The show won viewers and Emmy awards (95 through 2015) with in-depth reporting, well-told stories and high production values. By 1979 it was the highest-rated TV show of any kind. By 1982 a 30-second ad on 60 Minutes went for $175,000, more than 10 times what it cost in 1975.
Networks realized that television news could make money and began working to make it all profitable. The game had changed.
‘60 Minutes’ begat ‘20/20,’ and then ‘20/20’ begat ‘Dateline’, and ‘Dateline’ begat ‘Primetime Live’…And now, all of a sudden, making money became part of what we did. — Ted Koppel, ABC News anchor
End of Cold War downsizes foreign reporting
1991 — New York City
During the Cold War years of capitalism and Communism clashing in Asia, Africa and Latin America, US TV networks devoted more than 40% of their coverage to foreign stories. But after the collapse of the Soviet Union in 1991, the US and USSR were no longer behind every regional conflict. International stories became less relevant to many American viewers.
US news networks were already cutting back on foreign news, but the pace accelerated. By 1995, international reporting made up only 13.5% of TV news coverage, down from its height of 45% in the 1970s.
News programs in general — and foreign news in particular — seem to be disappearing in a flood of entertainment and niche-oriented channels — Claude Moisy, former AFP chairman
Birth of the cool
1994 — Montreal
At the opposite end of the media spectrum from network news, Shane Smith and two friends started Voice of Montreal. The free, printed punk zine covered the party scene, hookers and drugs, not from the point of view of concerned authority figures, but as enthusiastic consumers. Two years later they changed its name to Vice.
Their audience grew, and Smith seized on the formula of printing one page of ads for every page of content. A charismatic salesman, Smith won corporate partnerships to produce sponsored content with Vice’s edgy youth appeal for other media. The deals expanded the Vice brand into DVDs, music publishing, fashion, and online text and video.
The last hurrah of US network foreign reporting
2001 — Afghanistan and Iraq
In the months after the September 11 attacks, US news channels doubled their international reporting. As the US invaded Afghanistan and Iraq, foreign news budgets soared as teams were deployed to cover the regions.
But the attention was short-lived. As the wars dragged on, news budgets ebbed and far less coverage was devoted to Afghanistan and Iraq, which already dominated non-US reporting. By 2010 Afghanistan coverage was falling fast, and the Iraq war averaged 30 seconds of network coverage per week.
More and more, the networks stayed home, leaving a vacuum of foreign TV reporting, just as devices and platforms for video capture and distribution had become easier and less expensive.
Vice crosses the border into news
2007 — Baghdad, Iraq
As the broadcast and cable networks carried less international news, Vice stepped in to produce more, moving from alternative culture to foreign reporting and harder news both in the US and abroad. The company’s 2007 documentary Heavy Metal in Baghdad, which came at hard news from an alternative culture angle, won critical acclaim.
At a time when magazines were folding and investment money flowed to platforms like Hulu and Netflix, Vice bucked the trend and doubled down on content. Former Viacom CEO Tom Freston, who had helped MTV succeed, joined Vice. The company launched three online video channels to cover music, technology and culture news, co-branded with sponsors like Intel.
Everyone was spending all their money on platforms but none of it on what you put in the pipe. So we said, OK, eventually the market’s going to catch up, and everyone’s going to need content. Shane Smith, Vice co-founder, 2011
Vice does what Al Gore’s Current TV doesn’t
2009–2013 — Brooklyn, NY
In 2004 Al Gore and his partners bought a cable news channel and renamed it Current TV, intending to create a youth-oriented network combining native and audience-submitted content. The company failed to find enough audience, blew an IPO in 2009 and closed in 2013. Its remains were purchased by Al Jazeera in 2013 to create Al Jazeera America and AJ+.
Meanwhile, Vice’s audience and news output grew. Vice published video captured by young punk correspondents in conflict zones around the world while mainstream network reporters filed stories from the Hilton. Viewers appreciated the immediacy of amateur reporting from hostile locales that network TV had abandoned. The youth spoke, and Vice was cooler than Current.
North Korea stunt takes Vice mainstream
2013 — Pyongyang, North Korea
Old Asia hands who’d soberly covered North Korea for years cringed when Shane Smith took basketball star Dennis Rodman on a sensational tour of the isolated country, including meetings with ruler Kim Jong-Il. It was the perfect publicity stunt to kick off Smith’s biggest achievement yet, an HBO documentary series that made Vice a household name.
Critics called it “bro-style reporting” with no journalistic rigor. Smith countered that traditional news’ claims of balance and objectivity were impossible. More viewers clued in that Vice had been producing video reporting from interesting scenes and locations for years. Within a year, Vice launched a dedicated news site and YouTube channel, Vice News.
Vice goes legit
2013–2015 — Williamsburg, Brooklyn
Four months after the HBO series debuted, Fox paid $70 million for 5% of Vice. Fans and journalists asked if the company was selling out. If so, it wasn’t going to stop there. A&E bought 10% a year later, valuing Vice at $2.5 billion. Vice News content now shows on video screens in airports.
Vice has been stacking its management team with suits, Last week, Condé Nast publishing veteran Richard Beckman became its chief revenue officer. He joins recent hires like Chief Operating Officer Alyssa Mastromonaco, who worked for the Obama administration, and Co-President James Schwab, a lawyer who advised on the creation of Dreamworks and The Oprah Winfrey Network.
Further Reading
Vice co-founder Shane Smith tells the New York Times objective journalism is impossible.
“The Evolution of Television News,” Water Cooler Journal.
Sources
Encyclopedia of Television — The Museum of Broadcast Communications
The Evolution of Television News — Watercooler Journal, Mike Skrobin
News, Profits & Corporate Takeovers — PBS, Tom Bettag
Media, Markets & Public Spheres: European Media at the Crossroads — Google Books, Jostein Gripsrud and Lennart Weibull
Vice’s Shane Smith: ‘Have We Unleashed a Monster?’ — New York Times, WILLY STALEY
Frontlines and Datelines — PBS
The war without end is a war with hardly any news coverage — Nieman Watchdog
Year in Review 2010 — Tyndall Report
Heavy Metal in Baghdad — VICE
Tom Freston’s $1 Billion Revenge: Ex-Viacom Chief Helps Vice Become the Next MTV — Forbes, Jeff Bercovici
Al-Jazeera buys Al Gore’s Current TV — USA Today
‘Vice’ On HBO: News And Stuff, Bro-Style — Huffington Post, Maureen Ryan
Rupert Murdoch firm dips into hipsters’ bible with $70m stake in Vice — The Guardian
Fox Invests In Vice, A Media Company That Makes Money Being Terrible And Brilliant — TechCrunch, Anthony Ha
Vice News Launches, Promising ‘Changing Of The Guard In Media’ — Forbes, Jeff Bercovici
A&E Networks Buying Minority Stake in Vice Media — Hollywood Reporter, Paul Bond
Vice Media Taps Publishing Veteran Richard Beckman as Chief Revenue Officer (Exclusive) — Hollywood Reporter, Natalie Jarvey
Fox Launching Vice Films as Joint Venture — Variety, Dave McNary
