Ethics and reporting on tech companies

New York Times business columnist David Carr does not like the move by AOL to invest in the venture capital fund being run by TechCrunch founder Michael Arrington and that it’s allowing Arrington to continue to write for the tech news site, even for free.

Carr writes, “One of the sharpest critiques of this conflation came from Paul Carr, who happens to write for TechCrunch (and is no relation to me). He savaged Mr. Armstrong for fumbling the announcement and sacrificing TechCrunch’s editorial credibility, and said he was worried that ‘investors will gain influence over how CrunchFund-backed companies are covered on TechCrunch.’

“Maybe the DNA of the place that Mr. Arrington built is hearty enough to survive the clumsy hands of its owners. And of course there are other venture capitalists — Om Malik and Fred Wilson  — who both publish and trade on information. But TechCrunch is a large, influential news site owned by one of the few companies still investing in journalism, and that company has been effectively put in a corner by a guy who was supposed to be working for it.

“Mr. Arrington is powerful enough to have remade a corner of journalism to his own liking. But in an effort to accommodate the demands of one, AOL may have altered the terrain for many. If insiders can trade on the news they publish, readers may become an adjunct to a business that is less about public information than private gain.”

Read more here.