Inside the $3B 'Gossip Machine'

Authorities want to protect privacy, but thwarted by a 'river of cash'

By Mark Russell,  Newser Staff

Posted May 22, 2011 7:09 AM CDT

(Newser) – The behemoth gossip industry relentlessly ferrets out any and all scurrilous details about celebrities, churning out "rivers of cash" that amount to about $3 billion a year, and often tossing privacy laws by the wayside, reports the New York Times in a lengthy look. And thanks in part to the media feeding frenzy that erupted over Arnold Schwarzenegger's love child, there is a growing movement to shut down that explosion of personal information of dubious legality. “They ought to maybe hook up with the CIA,” said the judge presiding over a case involving Michael Lohan, after seeing the volume of private information the major gossip sites dug up.

“It’s a business,” says Lohan. “If they want to write stories about me, why shouldn’t I get paid to tell the truth?” “We’re trying to build what they call addicts online,” David Perel, the managing editor of Radar Online, which often posts more than 30 exclusives a day. With gossip sites willing to pay millions for top stories—photos of Michael Jackson in the coroner's office could have fetched $2 million—but with rehab and medical workers earning as little as $22,000 a year, there's little sign that those paydays are going away.

FILE - In this May 20, 2010 file photo, Michael Lohan, father of actress Lindsay Lohan, takes questions about his daughter, after a hearing in Beverly Hills, Calif. Authorities in Los Angeles say Lohan was arrested Monday, March 21, 2011 over allegations he held his girlfriend against her will and...
FILE - In this May 20, 2010 file photo, Michael Lohan, father of actress Lindsay Lohan, takes questions about his daughter, after a hearing in Beverly Hills, Calif. Authorities in Los Angeles say Lohan...   (AP Photo/Damian Dovarganes, File)
Lindsay Lohan arrives at Los Angeles Superior Court, Thursday, March 10, 2011. The New York Times investigates the $3-billion gossip machine in a long article.
Lindsay Lohan arrives at Los Angeles Superior Court, Thursday, March 10, 2011. The New York Times investigates the $3-billion gossip machine in a long article.   (AP Photo/Damian Dovarganes)
Photographers and members of the media wait outside the side exit of Beverly Hills courthouse for the departure of actress Lindsay Lohan on September 24, 2010 in Beverly Hills, California.
Photographers and members of the media wait outside the side exit of Beverly Hills courthouse for the departure of actress Lindsay Lohan on September 24, 2010 in Beverly Hills, California.   (Getty Images)
TMZ reports the news that Michael Jackson has passed away on June 26, 2009 in London, England. The iconic pop star, 50, was rushed to the hospital today after going into cardiac arrest.
TMZ reports the news that Michael Jackson has passed away on June 26, 2009 in London, England. The iconic pop star, 50, was rushed to the hospital today after going into cardiac arrest.   (Getty Images)
Paparazzi and members of the media wait outside a Beverly Hills, Calif., courthouse Tuesday June 8, 2010 during a closed-door meeting between the judge and lawyer for actress Lindsay Lohan.
Paparazzi and members of the media wait outside a Beverly Hills, Calif., courthouse Tuesday June 8, 2010 during a closed-door meeting between the judge and lawyer for actress Lindsay Lohan.   (AP Photo/Nick Ut)
Lindsay Lohan arrives for the afternoon session of the probation revocation hearing at the Beverly Hills Courthouse on July 6, 2010 in Los Angeles.
Lindsay Lohan arrives for the afternoon session of the probation revocation hearing at the Beverly Hills Courthouse on July 6, 2010 in Los Angeles.   (Getty Images)
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