Thread by @carolecadwalla

Journalists are meant to speak truth to power. That's our job. But what do you do when that power is your own news org?

This thread (professional suicide note?) is about @guardian & @ObserverUK's future. Because it turns out you can’t believe everything you read on a poster..
1/

Since 1993, @ObserverUK has been owned by @guardian. Which is owned in turn by the Scott Trust set up in 1936 to preserve the financial & editorial independence of @guardian "in perpetuity"

But perpetuity ain't what it used to be. And 2 weeks ago, a bombshell lands: Tortoise Media is in talks to buy @ObserverUK.
2/
news.sky.com/story/guardian…

If you don't know, @tortoise is a plucky media start-up founded in 2019 by James Harding, an ex-ed of @thetimes & a big beast of UK news.

But the thing is...it's like @guardian says, 'Thanks to reader funding, we're not for sale'.

So…what gives?!?
3/

And maybe you spotted the loophole: the Scott Trust is committed to preserve the @Guardian 'in perpetuity'. But not Johnny-come-lately @ObserverUK.

This is exactly the argument put to the Scott Trust. Who gave approval for @guardian to pursue negotiations.

There's just one small hitch…
4/

It's not just that @ObserverUK shares a bloodstream & vital organs with @guardian: same editor-in-chief, office, foreign, sport, business, legal, commercial, IT and marketing & managing ed teams.

Or that all @ObserverUK contracts are with the @guardian as it says it right here in big black letters...
5/

Because @ObserverUK doesn't really exist. It has no corporate entity. Technically, legally, practically, morally, fiscally, we are a sub-brand of @guardian.

And our work has been sold to @guardian readers as @guardian journalism on @guardian website where this appeal appears beneath all our work.
6/

And remember the Scott Trust & its mission to "secure and preserve the financial position and editorial independence of the Guardian in perpetuity"?

In 1993, when the @guardian bought @ObserverUK, then chair of the Scott Trust, Hugo Young, promised in big black & white letters on the front page of @guardian that "the trust safeguards will be fully extended to the Observer”.
7/

But @guardian leadership say that @tortoise deal is an "exciting" opportunity for @guardian AND for @ObserverUK. Not least because @Tortoise will invest £25m into @ObserverUK.

Which sounds GREAT. We certainly need the love. But...

It turns out this also has to fund transition costs & running costs & Tortoise costs & staff costs. Not to mention replacing @guardian's sport, business & foreign news.

Meanwhile, @Tortoise has issues of its own...
8/
pressgazette.co.uk/news/tortoise-…

In its last published accounts, @Tortoise made a £4.6m loss on £6.2 revenue, a cumulative loss of £16.3m since it was founded in 2018.

In fairness, this is what start-ups do. It's what makes them such a high-risk bet. Which is why VC-funded news orgs struggle in the long or even medium-term. Just look at @BuzzFeed & @VICE.

Meanwhile, @guardian is sitting on an endowment of £.1.3 BILLION.
9/

The unanimous opinion of 400+ @guardian & @ObserverUK journalists following an @NUJofficial vote is that this deal poses an existential risk not just to @ObserverUK but also to @guardian.

And the great & the good - @hackedoffhugh, @carolvorders, @wmarybeard, @jeremydeller, @asifkapadia, @CarolineLucas - to name just a handful - say it is a grave threat to UK media plurality.
10/
pressgazette.co.uk/publishers/nat…

And - disclaimer! - I like James Harding & a big dose of energy, strategy & judicious investment is *exactly* what @ObserverUK needs.

But after 2 weeks of meetings with 30+ @ObserverUK journalists no-one is any clearer about @Tortoises's opaque finances, business plan, or what happens when this £ runs out, possibly within 2 years.
11/
pressgazette.co.uk/news/who-owns-…

So, I'm putting this out here. Because we need strong, independent, financially robust news organisations more than ever.

Journalism is the crucial frontline against the techno-populism sweeping the planet. And like it says @ObserverUK & @guardian are reader-funded not billionaire-backed.

So...why sell out to a billionaire?!? Or..whoever is funding the deal. We don’t actually know!!
12/

But hope is power. And change is possible. So here’s a counter-proposal to the Scott Trust board. Let us build our own liferaft.

Let @ObserverUK set up a strategic review group with external expertise to investigate ALL options.

Including investing into an actual @ObserverUK online brand: the digital identity that @guardian management has repeatedly refused to allow us to have.
13/

If Scott Trust thinks that @Tortoise's £25m could preserve @ObserverUK long term - which it must to even consider this deal given its obligation to "freedom of the press & liberal journalism" - then let us make an investment case for it.

There is a sustainable model for 21st century journalism. One which involves something no-one has mentioned anywhere in this deal: our readers.
14/

Because that's what's entirely missing from the @guardian/@tortoise master plan: the readers.

We are nowhere without them. Yet they - you - aren't being consulted or even properly informed about what currently looks like less a 'deal' than a switcheroo.

We've been asking @observerUK readers to contribute to @guardian funds for years. And they have! This story made more money for @guardian than any other in its history.
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Which is why I've decided - after a lot of reflection - to speak up. Because I know how hard @ObserverUK journalists have worked in the face of years of under-resourcing & cuts.

And because I actually have been supported - more than you can ever know - by @ObserverUK & @guardian readers.
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When the chips were down, it was 30,000 readers who had my back. Not the £1.3bn endowment fund. My loyalty is above all is to them.

They're not just the lifeblood of @guardian & @ObserverUK but also due to its 'unique' funding model its financial future. Yet they have no say whatsoever in what that future is.
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And what this episode has revealed is that @guardian's current governance structure is a risk to its long-term survival.

Because the Scott Trust isn't actually a trust. It's a private limited company. But with no investors on the board, there are also no stakeholders holding anyone's feet to the fire.

The below is from its former chair: "It has been difficult to devise a clear system of accountability."
18/

As a liberal progressive news org, @guardian publishes articles pushing for workers on boards - quoting @IPPR & @The_TUC who say any company with >250 employees needs min 2. Yet we have just one.

If we had proper representation, would this "exclusive negotiation" have been waved through in total secrecy??

It was agreed in July. We only found out 2 weeks ago...when @skynews broke the story!
18/
theguardian.com/business/nils-…

No-one with any personal stake in the the future of @ObserverUK has any involvement in the negotiation of this deal or its final sign-off.

No @ObserverUK journalist or editor sits on either Scott Trust or GMG boards. And most important of all, nor do the readers. There's not a single reader director on either even though they now are the company's true financial stakeholders.
19/

We, the journalists of @ObserverUK believe the UK desperately needs more not less media plurality. And that this deal risks the title's future & editorial independence.

And we also believe a better future is possible. Let us, the journalists - with readers' input - independently research & present an investment case & business model to Scott Trust.

Hope is power. 🙏
ENDS