Business news coverage and the Facebook IPO

Arthur Brisbane, the reader representative of The New York Times, writes for Sunday’s paper about how it could have done a better job of being skeptical about the Facebook initial public offering.

Brisbane writes, “One journalist who did focus intently on the risks before the I.P.O. was Eileen Brown, a social media business consultant who blogs for the ZDNet technology Web site. In a series of posts, she dissected the Facebook prospectus and laid out the risks facing the company — and she told me later that she had come away from the exercise with increasing doubts about the I.P.O.

“She said the ‘fire hose of information’ about Facebook — on the Web and in print, in specialized and general media — made it very difficult for small investors to assess the company.

“In my view, that is one reason that The Times should have provided more focus for general-interest readers, who needed help cutting through the clutter. More coverage aimed at small investors may well have led to more scrutiny of the risks.

“But with its specialized finance blog, DealBook, plus its general-news mission over all, the paper is committed to two audiences, and that is a challenge.

“Larry Ingrassia, the business editor, told me the paper writes ‘for a broad and intelligent audience of generalists but also with sophistication for a more informed specialist audience so that they feel that they are learning something from what we are writing.'”

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