But brand isn’t everything. “All the CBS brand does is accelerate the belief factor,” Kramer says. “We have to deliver…. We do not tout stocks. Commentary with a lot of attitude. We have no commentary like that.”
Curiously, however, a bar down the left side on the site’s front door points to more than 20 links under the heading “Commentary.”
Such opinions may not be such a bad thing in a confusing market, says Golar Grabowicz, coordinator of the new media program at the University of California at Berkeley’s Graduate School of Journalism. Take is a good way to address this-have a stable of commentators, like James Cramer, trying to make some sense of the news.”
But Cramer has gotten into trouble for his commentary. Last December he was briefly suspended from his regular appearances on CNBC after Phoenix-based WavePhore said he unfairly criticized the company on the air, causing the company’s shares to fall after several days of upward momentum. Cramer said his on-air comments were misunderstood. WavePhore, meanwhile, says it has asked the SEC, NASDAQ, and the FCC to investigate.
All the leading financial news sites run corrections on their reporting boo-boos, which have ranged from transposing ticker symbols (resulting in misreported share prices) to citing the wrong reason for a stock’s drop.
A Fool and his money
The Motley Fool, which offers a blend of news from a staff of 20 writers, offers a response to editorial melding by calling its reporters “writers” and making it clear that it is all about commentary. With about 1 million page views per day, the site offers electronic bulletin boards for readers to sound off, money-management tips, and stock information.
Despite criticisms of the Fool’s for, as one analyst put it, “vapid chat and the potential for rigging stocks,” the Fools say they do not tout stocks. “We never allow discussions of penny stocks, because they are easily hyped and are just a bad investment,” says Motley spokesperson Chris Hill, adding that the Fools play a different role than their more newsy competitors-educating regular folks about the stock market. “A reporter once called me and said that we were hyping Kodak,” Hill recalls. “Well, Kodak is one of the biggest companies in the world. How can you hype Kodak?”
Critics says that full disclosure from both the companies and their reporters could help sites avoid accusations of touting stocks. “We have to make sure that people understand the many connections, especially in the online world where there is so much convergence going on,” says UC Berkeley’s Grabowicz. Market forces could ultimately make news sites more accountable. “It would not be in these sites’ best interest to hype their own stocks or Internet stocks in general,” says Peony Kao, an analyst at Renaissance Capital IPO Fund. “The editorial content has to remain accurate or the traffic will go elsewhere, and the stock will fall.”