A Model to Fund Online News Is Needed Now
How to Monetize, or Pay for the News As It Moves to the Internet.
Mar 24, 2009 Kathlin F. Sickel
As news moves online where it is freely available, and easily accessible anytime by anyone with access to a high speed internet connection, news companies are finding even more tough going in the newly beleagured business environment.
News Publishers Face Problems, Seek Solutions to becoming Profitable Online
What seems to be a bonanza of information for the online news consumer, is a colossal headache for newspaper publishers who have been slow to move their papers on line, and uncertain about how to do it profitably. They see no obvious way for online revenues to produce the kinds of profits it takes to support a large news gathering staff; one with the human resources to cover government and corporate power at all levels (local, state, and national) in our communities.
While news publishers have been debating their future, their problems have only increased. The news at every journalism website, such as Romenesko at the Poynter Institute repeats this mantra: dependable revenue streams are drying up; paid subscribers are steadily decreasing, and their classified ad sections have completely fallen away, replaced by online, mostly-free services like Craigslist.
Now the news industry's internal debate has become a very public one. As highly respected and often quoted newspapers such as the Rocky Mountain News, the Seattle Post Intelligencer, and the Christian Science Monitor, go out of existence or go digital-only, everyone -- not just those in the news industry -- has started paying attention .
In recent weeks some of the media's world's most visible leaders have helped focus that attention:
- A cover story at Time Magazine ("How to Save Your Newspaper," February 5, 2009);
- A series of email conversations between readers and New York Times Editor Bill Keller (Talk to the Newsroom, Feb. 2 -6, 2009);
- A two-part piece at National Public Radio on the future of newspapers (Feb. 5 and 6) have each offered suggestions on how to fund the delivery of news to the internet.
Micropayments and endowments for a nonprofit business model are among the key proposals being talked about.
Micropayments, Nonprofits, and Endowments
Walter Isaacson, the head of the Aspen Institute, and the former managing editor of Time wrote the cover story that suggests "how to save your newspaper." Isaacson strongly believes that charging for content needs to be tried again with micropayments. These would be small, almost insignificant charges per article deducted from a monthly fund created by the consumer -- sort of a variation on iTunes for news.
This is also known in online lingo, as putting a news publisher's content behind a pay wall.
Although there have been many news company experiments with this concept in the past (for example, the New York Times Select, 2005-2007) most have been abandoned for diverse reasons.
One of them, that the technology for making the payments was too cumbersome and foreign to most consumers is no longer applicable. Technology improvements have been made and all evidence points to the fact that many consumer are comfortable making all sorts of online purchases. But another reason -- that there is too much competition from news companies that continue to offer their content freely -- remains in place.
In "Talk to the Newsroom," in February, Times' Editor Bill Keller talked about that and also the the potential for micropayments. He then discussed two other potential new funding models: the idea of turning newspapers into nonprofit endowed institutions, like major universities, and also a voluntary pay model run like a digital version of a National Public Radio membership drive.
In fact, both ideas were given closer study in the NPR piece on the future of newspapers cited above. In "A Non Profit Panacea for Newspapers?" reporter David Folkenflik talked with Paul Steiger, the former managing editor of The Wall Street Journal and now the editor-in-chief of Pro Publica.
Entirely funded through wealthy philanthropists, the nonprofit Pro Publica is a new investigative reporting "newsroom" and the work of its two dozen reporters has appeared on "60 Minutes," in the New York Times, and in smaller publications from Albany to San Diego. A second way to support a nonprofit news organization is with public funding, similary to listerner-supported NPR. Folkenflik looked at several newssites that are following that kind of voluntary pay model, too.
Downloadable Newspapers, Crowdfunding, and More
While paid content via micropayments and endowments for nonprofit papers are getting the most attention right now, they are by no means the only ideas under discussion.
In the months to come, news consumers will be hearing more about downloadble papers for Kindles and other portable electronic reading devices. They will hear about low-profit -- or just-covering-the-costs -- business models for news organizations, as well as ways to apply the successful cable news model to the newspaper business.
They can also expect to hear about sustainable journalism (hyper-local news coverage supported by a hyper-local ad network) and crowd funding -- public funding of individual investigative reporting projects. They can expect the discussion to be ongoing into the forseeable future.
In the words of Times Editor Bill Keller, "...a lively, deadly serious discussion continues within The Times to get consumers to pay for what we make."
Newspapers, once everywhere, are now endangered
|
What do you think about this article?
- News Leaders Consider Online Subscription Models
- Get to Know More New Media Words and Concepts
- News Execs are Searching for New Revenue Streams
- How The Internet Killed Traditional Journalism
- American Newspapers Dying
- Newspaper Symposium on Individualized News
- Report Outlines Proposals to Revive Newspapers
More in Writing & Publishing
Latest Articles