Is the current noise being made by writers about having their compensation slashed at www.seekingalpha.com just the tip of the iceberg?
SeekingAlpha.com is a very powerful content aggregator that has scooped up thousands of once-independent writers and that all seems like a good thing – until that power becomes abused or, even worse, is used to mislead the readers who have transferred the trust built up by those thousands of writers to SA – as you can see from the bullet-points from SA's own "About Us" page.
It's hard for me to say what's going on over there as I've now been banned from the site. I can still view it but every comment I make is immediately deleted – lest I poison the well, apparently. This is, of course, making me look bad to the 57,090 people who follow me there (according to SA) and damaging my reputation with the 276,971 people they claim to send my articles out to in their "Macro View Daily" Newsletter as well as I am now unable to respond to questions – making me look arrogant and unapproachable, in the very least. That is, of course, very damaging to my service, where approachable is what we sell!
Articles I've written, as well as comments that were published on the site have now been redacted in the most amazing sweep of censorship since Stalin. What would cause a major web-site like Seeking-Alpha to act like a Russian Dictator trying to suppress it's critics? At first we thought it was my criticism of Big Oil and the Manipulation scandal at the NYMEX but, to their credit, they've carried these stories before.
We have to look at the article the day I was redacted and try to find out what may have set them off. As I mentioned, we discussed the oil scam, and we discussed the Fed and that's not it so what is it that had them go and pull this article off their web-site AFTER they published it. Going back to my Author Page on SA, they also rejected Wednesday's article and that one is where I mentioned Tobin Smith and the kickbacks he's allegedly getting for writing articles on small cap stocks.
Ah, now the plot thickens because, according to SA: " as we feel your recent comments in the contributor forum indicate your interests are no longer aligned with Seeking Alpha, and have therefore decided to stop syndicating your articles."
That's interesting because in that forum (from which I am now banned), the writers were discussing SA's new policy of encouraging them to write more articles on small caps and we were speculating on why they would do this since, clearly, there are less readers for those kinds of stocks. Of course, large cap stocks don't give out kickbacks (not that we know of) for positive press so perhaps it's not a matter of what the readers are interested in but what can be promoted through other avenues. Anyway, we were just speculating and I don't know how many other authors were thrown off the site for having this discussion but now I'm hearing there may be a class-action suite against SA for this and other actions.
Whether or not they are, as alleged in Goode Trades "being co-opted by paid stock promoters" or not, I can't say. I mean literally, I can't say as my speech is being repressed! Other authors have gone quickly silent on the subject and, why shouldn't they – if SA is willing to burn one of it's more popular writers over comments in what he thought was a private chat room – what are they willing to do to the rest of them, many of whom depend on those article checks to pay the bills.
Seeking Alpha already printed an article to put a lid on this scandal on May 23rd titled: "What We're Doing to Stop Stock Price Manipulation, And How You Can Help Us" but, interestingly enough, they only sent it to 415 people who subscribed to the GOFF Email Alerts and another 92,418 people who get their Global Investing Daily. As an SA writer at the time, I certainly don't recall getting any notices that authors must comply with a new policy that strictly prohibits kickbacks or other forms of stock promotions.
In any case, I applaud any effort to prevent the reading public from falling victims to these pump and dump scams but, as noted with oil – don't ever think that sort of behavior is limited to small caps and penny stocks alone!
The crux of my indignation with SA wasn't about whether or not they are involved in something nefarious, I was merely talking to the other writers about the way in which SA has cut the amount of money paid per view to the authors by no longer counting on-line views as views. Of course, that led to a discussion about how the authors needed to organize if they ever want to be able to negotiate realistic wages (and this was BEFORE the writers discovered that Yahoo Finance pays 1.4 cents per view – 40% more than SA and SA turns around and syndicates the writers work to Yahoo, presumably for a fat profit over and above the other revenues they collect).
Obviously, any talk of organizing labor is something any good Capitalist wants to nip in the bud by firing anyone who even dares to bring up the subject so let's not fault them for making sure their labor pool works as cheaply as possible and remains ignorant of other potential outlets – that's all business, nothing personal. I'd quote you on what was said in the writer's forum but, as I said, I've been banned – so I have no idea what's been left up by the company or even what writers besides myself have had their rights revoked after engaging in a conversation.
According to The Deal.com, Dave Gentry, chief executive of investor relations firm RedChip Cos., said that Seeking Alpha is often used as a vehicle by stock promoters. "Seeking Alpha is easily the biggest abuser, as far as allowing bloggers to promote stocks," he said. "Some of these guys are I.R. guys, quasi-I.R. guys or friends of the CEO, but they are being paid under the table to promote stocks."
Jacob Wolinsky, who runs investment information website ValueWalk, said he was offered $1,000 to write an article praising Sunpeaks. Wolinsky said he was offered an additional $500 if he agreed not to disclose the payment, but refused the bonus. The article was published on Seeking Alpha in April 2012.
"I thought the guy who I talked to was just a shareholder who wanted some positive P.R.," Wolinsky said in an interview. "I had no idea that there was a promotion going on. It was the first and the last time I did a sponsored story."
Michael Goode, who has published almost 50 articles on Seeking Alpha, called Wolinsky's article "yet another paid stock promotion on Seeking Alpha," in a comment on the site. "SA has gone completely to the dogs over the last few years. It is a shame."
Ten or 15 years ago, bulk mailers were the way that stock promotions were done. About seven years ago it became mass e-mails," said Crocker Coulson, president of CCG Investor Relations. "Now the venue of choice is publications or sites like Seeking Alpha. The thing about it is that the people doing it are misrepresenting themselves and the investors looking at these stories may not be sophisticated enough to understand what is going on."
Felix Salmon is another angry author who questioned SA's entire payment system years ago saying: "Seeking Alpha here isn’t really paying per pageview at all. (If it were, it would pay contributors of all articles, not just exclusive articles.) What’s really happening is that Seeking Alpha is buying premium content, at zero up-front cost, which it can then resell in any way it likes and for as much money as it likes, with none of those revenues being shared with the author."
Also, from that same post, GlobalObserver points out that: "Despite considering the author worthy, it inserts a ‘No Follow’ html tag within all posts. This means that nothing that an author writes will be credited in Googles search algorithm other than to Seeking Alpha. No links or words will count. Most financial bloggers are clueless when it comes to Search Engine Optimization and fail to understand the ‘No Follow’ — Seeking Alpha will claim this is to stop ‘comment spam’ — that is, people posting links within comment sections for spamdexing purposes. But actually, nofollow applies to the authors article as well."
If only I had read that at the time, perhaps I would have wised up sooner – thanks for trying Felix!
We'll keep tabs on this, especially if the writers do end up engaging in the kind of class-action lawsuit that was brought against the Huffington Post in 2011. That suit failed but it apparently hinged on what sort of promises were made and what were kept, the Huffington Post had apparently never promised to compensate their writers while SA actively solicits paid contributions so it will be a very interesting one to watch with many millions on the line.
After all, what is a content aggregator without the content?
