Various things about this post make no sense (why compare a one-time-endowment to annual giving and why assume that news will generate no money, for example), but these figures are worth looking at:
Rick Edmonds, the estimable media economics expert at the Poynter Institute, calculated that American newspapers are spending $4.4 billion today on news-gathering…
If you wanted to sustain the current level of newspaper coverage by replacing for-profit funding with non-profit dollars, the typical approach would be to raise an endowment that would be invested conservatively to produce an annual return of 5%. The investment income would be distributed each year to provide the operating budgets for non-profit news organizations.
The endowment necessary to provide $4.4 billion in annual newsroom funding would be $88 billion.
In a $14 trillion economy, $4.4 billion isn’t much to spend on a little basic oversight. I continue to hold out hope that the better newspapers (specifically, the New York Times) will be able to survive on a non-profit private model, along the lines of America’s private universities.
Zifnab
I think that’s something of a solution right there. Most campuses already have a student-run paper. Expand it, flesh it out, and keep your best students on as reporters and editors.
Beyond that, there are plenty of fledgling papers that exist today that – should the NYT and the WaPo crumble – would grow to fill the void. I think blogs – from science blogs to political blogs to econ blogs to tabloid blogs – have already done to fill the space. I’m honestly not terribly worried about what happens if a giant crumbles. Certainly Murdoch doesn’t think news is a bad business to be in. He must know something, what with being worth billions.
This is one of those cases where you really do have to just kinda step back and let the free market provide. Don’t let the for-profits fool you into thinking they’re too big to fail.
Linda Featheringill
The newspapers serve a function, hopefully of being a source of reliable information, that SOMEBODY needs to do.
I personally would hate to see NYT go away. I mean, we cannot depend on The Guardian for everything! Although I have frequently been surprised by getting better US news out of the British newspaper.
SadieSue
Reposting:
Sort of OT (but not really as this is a pet loving blog) – I was just reading the NYT story on the Hutaree arrests & noticed this:
I’m hoping these dogs have already been rescued, but if they haven’t any ideas on what I/we could do (or how to find out whether they’ve been rescued or not)?
Martin
Um: http://www.propublica.org/about/
Cat Lady
I’d love to know what the Times wastes on MoW, MoDo and Bobo. It’s not like there’s a dearth of opinion in the world that can’t be had for free.
OTOH, there is a desperate need for quality reporting and analysis, and by getting rid of opinion you’d get rid of all of the equivalency problems. Assuming that reporters don’t operate under the assumption that facts have a liberal bias, which is a big assumption. Sigh.
freelancer
OT – DougJ!
Time for “Pin the Ranking on the Wingnut!: M4A1 Wedding Edition“
MBunge
“Beyond that, there are plenty of fledgling papers that exist today that – should the NYT and the WaPo crumble – would grow to fill the void. I think blogs – from science blogs to political blogs to econ blogs to tabloid blogs – have already done to fill the space.”
I think most major new organizations forfeited their right to exist after the way they failed in the lead up to the Iraq War, but I’m not quite as sanguine that the “youtubeification” of news gathering will be an adequate replacement, let alone an improvement.
Mike
some other guy
The way to keep your newspaper afloat is to provide quality reporting, unique insights, and thoughtful opinion. For instance, the Economist (to which I subscribe at a relatively substantial cost compared to other weeklies) is not struggling for survival– in fact, it’s thriving.
My local newspaper, meanwhile, has been operating in the red for years and I have never considered subscribing because their national/international coverage consists of cut/paste jobs from the wire services, and their local/state coverage isn’t very substantial.
Short Bus Bully
Dude, you think it’s hard to convince wingers that the media is not 100% librul now….
WereBear
Papers used to compete in what they offered. Now it’s simply a bland digest of same-old, purchased at the lowest cost.
I’m not paying for that.
BombIranForChrist
I am too lazy to read further, but does “news-gathering” also refer to paying people like Bobo and Modo for their opinions? I shudder to think how much these tools leech from their organizations in total compensation. Didn’t they send Modo out to get spa service for an article she was writing? Riiiiiight.
joes527
@Zifnab:
Serious?
It has been years since I’ve read a campus paper, but in my experience they are pretty uniformly bad.
Take everything that is bad about Big Time Journalism, add inexperience and a general who-gives-a-fuck-anyway attitude, and you have your typical campus rag.
A the school where I did my undergrad, we had 2 papers. One was the administration suck up paper (wapo without the redeeming characteristics) and the other was the leftist radical paper (Pacifica Radio in print … without all the balance)
Evert tree killed for either of those papers was a crime against nature.
Bnad
The press as nonprofit would come under even more attack from the corporate wingnutosphere than our current liberal media. The for-profit press at least was a capitalist business and as such was family.
Would a nonprofit press be anything more than PBS+NPR+The Nation. with slightly better funding? And what would prevent it from becoming NPR-atized in the name of “balance” to guard against wingnuts hurting its feelings by calling it irrelevant?
(cf. a good article in The Nation. about how NPR ran David Horowitz quotes on Howard Zinn’s death in his NPR obit)
FormerSwingVoter
Thanks, Cokie.
dmsilev
@freelancer: Shouldn’t you be addressing him as Arkon DougJ?
And how bizarre is it that members of a fundamentalist militia have Facebook pages?
-dms
ajr22
OT But Andrew Breitbart’s new rant is just to funny. Look at these tweets.
Phantom Egg: How cute that @ericboehlert now playing my editor?! Says I should cover militia instead of Reid Rent-a-Mob TeaParty attack.
Harry ‘Negro Dialect’ Reid Productions Presents ‘The Phantom Egg’. Coming to @ericboehlert’s rattled psyche soon.
Behold the man who still has a pager: @ericboehlert. ‘Phantom egg’ shall live in TeamPodesta infamy. When’ll Soros & Brockovich® cut bait?
@EricBoehlert Why exactly am I supposed to drop everything to cover the overcovered militia story? Youre a deranged spaz on display for all.
JGabriel
Zifnab:
Blogs are secondary news sources with commentary – i.e., they comment on stories they link to elsewhere or republish. VERY, very, few serve as sources for primary news content, although you’ll get no argument that they’ve become primary sources for interpretation and analysis.
But they aren’t typically news gatherers.
.
dmsilev
@ajr22: I know I’m going to regret asking this, but WTF is he talking about? What is the Phantom Egg?
-dms
Fairly Unbalanced
As long as that money is deposited directly in Rupert Murdoch’s bank account we at Faux Pravda salute you.
WAR IS PEACE
FREEDOM IS SLAVERY
IGNORANCE IS STRENGTH
ajr22
@dmsilev: Well it could be a figment of his imagination. But i guess someone at the teabag event in Nevada tossed an egg at a teaparty bus, or something of this manner. So now I believe Breitbart, is claiming this demonstrates that Democratic union thugs are actually more violent than teabaggers. Breitbart is of the ilk who believe the racist things yelled at Dems was a conspiracy. He sounds more and more like a ranting homeless person by the day.
Face
Why does Akron DougJ hate the USA (Today)?
KRK
@SadieSue:
You could call the Humane Society in Adrian — (517) 263-3463 — and ask if anyone has been out to get the dogs.
Dollared
I think you-all are smoking crack.
Yes, newspapers are in trouble. Yes, they are how we used to get some semblance of accountability. But I”ve got two questions for you:
1. How has that been working for the last twenty years?
2. Where are you going to find $88B dollars?
I think this kind of thinking doesn’t see the change that’s occurring. If you really want to see accountability via the media, then work on making the new media more viable. It’s a lot cheaper than $88B.
The problems have to be solved for both questions I raised above. On the business side, sites like TPM get real news. They have advertisers, How does that model move faster into the mainstream? How do they get more revenue? How do their relationships with their reporters /contributors result in strong career paths for great investigators (and enough money for their kids to go to college)?
Second, access journalism and cowardly equivalency is a core problem that affects all media. How do we attack them? How do we discredit these memes at the places where they are propagated, in journalism schools, seminars and ethics fora?
When does President (or a Dick Cheney) get ridiculed for avoiding hard interviews?
At the other side of the media revolution there will not be $88B in foundations funding traditional newspapers. There will be something else, and the majority of the activity will have to be for-profit, or it will either be not self-sustaining or it will be owned by the Koch and Exxon foundations.
The key is to make that new space meaningful, give it credibility, hold it accountable to seek the truth rather than serve private agendas, and have it serve people rather than the rich and powerful.
Wishing that newspapers won’t go away won’t help you get to that place.
licensed to kill time
__
When did DougJ become Akron DougJ ? What’s it all about, Akron?
ETA – ok, it’s Arkon, but…linky anyone?
freelancer
@ajr22:
Good to see that Wingnuts have taken the “ZOMG, we’re Victims!” card back from the fringe left.
What a bunch of p*ssies.
Punchy
He’s become a Zip?
freelancer
@licensed to kill time:
https://balloon-juice.com/2010/03/29/the-only-survivors-of-the-national-peoples-gang/
NobodySpecial
Eventually, you’re probably going to see reporters work on a for-profit model, not papers. Rather, you’ll pay the reporter, and he’ll report to you on what’s going on. We have the business models (PayPal, etc.), we just need the first trials.
licensed to kill time
@freelancer: Ah, it all becomes clear now. Linkythnx!
ThatLeftTurnInABQ
@Dollared:
Only the consumers of news can solve this problem. Ultimately we need better informed and more discriminating consumers of news than we have now, to reward good journalism and let the bad die on the vine. I’m doing what I can to educate my kids along these lines and pass the word over the watercooler at work, but beyond those grassroots efforts, I’m not holding my breath. If this change comes, it will be one of those long moral arc of the universe things.
The new media can help with this project in one regard: no more local monopolies. Aside from a few major metropoli, most cities in this country are one-newspaper towns, and have a few TV stations. New media are (I think) likely to prove just as capital intensive as old media (the idea of Poor Man Richard with his digital printing press in his basement sounds great until you find out how much effort is required just for the graphic design aspect of a decent looking website), but at least they aren’t locally restricted by the logistics of physical circulation. Thus I as a news consumer can browse around and reward good journalism which isn’t being produced in my own backyard. That was harder to do (albeit not impossible) with the old media.
Brian J
It’ll be interesting to see what happens to national brands like The New York Times. Currently, they are supplementing their own journalism with non profit journalism in Chicago and San Fransisco and, occasionally, through ProPublica. They are also using aggregation services like Fwix to heighten their own page views. This makes sense as a way to target lucrative readers in certain areas. In fact, since The Times came out with a separate S.F. edition on Thursdays and Sundays, they added about 1000 new subscribers. That’s about 5 percent or so, which isn’t anything to sneeze at, even with a relatively small sample size.
But why don’t they launch paid news services? There was talk of making a premium version of Deal Book around the time the pay wall was being announced.. Obviously, the audience for paying money for that is bound to be small, but it’s also bound to be wealthy. And while I doubt it would ever bring that much money to the table, every little bit helps. It could, as a bonus, make exclusive audiences read the non-premium parts of The Times more often.
I also wonder why other national brands aren’t advertising more in relatively cheap ways throughout the country. Going to read nytimes.com is probably one of the first moves someone living in New York or D.C. makes when reading news online, but what about in Atlanta, Detroit, and Houston? Why doesn’t The Times, for instance, try to advertise around local college campuses there, near bus stops or something? Assuming they aren’t doing this already and that it doesn’t cost much, it could make the paper more of a first read for people who are in relatively untapped areas.
Brian J
@Zifnab:
The problem with using Murdoch as an analogy is that his newspapers make up a very small part of his empire. And they tend to lose a lot of money. The New York Post has lost tens of millions for years and years. The WSJ isn’t doing much better, even if it does have a much better name. His newspapers seem to exist to either (a) buy him access in a media market or (b) supplement his other properties. His purchase of The WSJ was supposed to be a way for him to build up Fox Business.
Brian J
@JGabriel:
You’re absolutely right. I think blogs, and more to the point news aggregators, are incredibly valuable, but they can’t replace on the ground reporting.
Dollared
@Brian J.
Yes. Looking at it from the ground up, newspapers pay people, full time with expenses, to find information and write it up. The new model, whatever it is, has to fund that activity.
Do that, and the readership will follow. Don’t do that, and no innovation matters.
Brian J
@freelancer:
This, from the guy who worked for the administration that started spying on its own citizens. I’ve always thought about going to one of these events to, um, question certain people, like Steve Doocy or Bill O’Reilly, but I’ve never done it. If that piece of shit Karl Rove ever shows up near me, I may finally do it.
Martin
@Brian J: The problem with paywalls is that you destroy the expectation with the customer. Getting through the paywall needs to be fast and easy, and newspapers are about the shittiest outfits on earth at collecting your money painlessly. It can’t take longer to process the transaction (including all the shit they want you to enter) than to read the article you were aiming for.
And if readers are turned away from content by the paywall, how do they know what to expect will be free and what won’t? That tends to turn readers away entirely, making the problem worse.
I still contend that putting the pay content on a device like the iPad or Kindle, not with exclusive content, but with enhanced content is a better avenue. Customers can clearly tell the difference between using an iPad and their computer, so their expectation are more predictable. Among other things, if you do have a small (small!) bit of advertising on your pay content, you can command a premium for it, mostly because you can pitch to advertisers that they have premium location and they are reaching an audience of people that are willing to pay for things. The publisher is delivering a highly desirable customer base to the advertiser.
Brian J
This isn’t breaking news, but The Atlantic has an interesting feature where they ask media personalities what they read. It’s called Media Diet. Tucker Carlson was recently profiled, where he said the following:
I am honestly not sure whether he meant he cleans up what someone says to him over a waldorf salad with dressing on the side and an iced tea and turns it into a news story or he uses it as the basis for a story but follows up to make sure it’s accurate and worthy of being printed. Or was it something else?
Brian J
@Martin:
I think it depends on how they do it, yes. I think the overall idea of giving people X number of articles for free each day–with some content, like movie reviews, being free–makes the most sense. There aren’t that many articles everyone links to each day. If there’s one or two, a blog like this linking to them can do so relatively easily without being hit by the paywall. The people who would run into a wall would probably gladly pay, as they are the ones using the site the most.
From what I’ve read, that seems to be the strategy The Times is going for. What exact form it takes is unclear, however.
Corner Stone
@Brian J:
IMO, they exist for two reasons 1) to deny resources to newspapers with a competing agenda, 2) to set the ideological table so his other business enterprises achieve their business goals in a more efficient and profitable manner
SadieSue
@KRK:
Thanks so much, KRK! Normally, I’d be able to figure things like this out all by my lonesome but I have a wicked head cold & thinking is way beyond my abilities at the moment. I’ll give them a call.
Nellcote
@ajr22:
Fave foto
Brian J
@Corner Stone:
I don’t think our answers necessarily come at the expense of one another.
Calouste
@some other guy:
That’s because the Economist is in the business of selling content, where most other publications are in the business of selling advertizing space. Just put something like Time or Newsweek side-by-side with the Economist and compare the number of ads and the quality and content of the articles. Yes, the Economist costs more then 3 times as much to subscribe to as Time, but you get what you pay for.
SadieSue
@SadieSue:
I left a message for the humane society – they were on another line so I’m hoping others have called just to make sure someone checks on the dogs. Thanks so much for the number, KRK – I appreciate you taking the time to find the information for me.
KRK
@SadieSue:
My pleasure. Thanks for making the call.
Brachiator
A. I’m not sure why newspapers should be non-profit.
B. An editor of a hanging on newspaper (can’t recall his name just now) recently gave an interview with Terry Gross on “Fresh Air” in which he noted that a newspaper without sufficiently deep pockets could be sued out of existence by a target of its investigation if it were a non-profit.
Calouste – That’s because the Economist is in the business of selling content, where most other publications are in the business of selling advertizing space.
I subscribe to The Economist, but it can be as much hit and miss as any other publication. And their ads ain’t cheap (you can easily get their rates by a google search). A one time back cover ad is $199,450. “Double page spread special position” is $313,950 (both four color bleed).
The fantasy that any magazine or newspaper is selling content to subscribers, and not readers to advertisers, really needs to stop.
Calouste
@Brachiator:
Of course the Economist charges premium for ads. Why wouldn’t they? But at least for the $2.20 they charge per subscription issue, they can print and distribute it and have money left. Time charges less than 80 cents per issue (and that’s the $40/year they charge on their website, but I have seen offers as low as $15/year), and I doubt that will cover paper, ink and postage. The difference is that, not accounting for ad revenue, Time makes a loss on each additional issue they sell, where the Economist makes a profit. Don’t tell me that that isn’t a different business model, even if only in emphasis.
JackieBinAZ
It’s not that no one could have foreseen that cutting back on reporting would compromise the primary and irreplaceable value that newspapers provide. It’s just that for the past 15 years, job security and upward mobility have gone to those who are most sympathetic to management’s priorities. I think that explains some of why you see so many sycophants rising to high positions in the industry.
It also explains why I’m pursuing a career in federal land management after 25+ years in journalism. Well that and because I’m a commie.
SadieSue
@KRK:
You’re welcome – I’m so glad you gave me the number!
Here’s the update – the humane society just called me back. Their understanding is that the Federal government will be taking care of the dogs so I told her that the news story seemed to indicate that after everyone left, the door to the home was left open & that the dogs were still tied up at the house. She said she’d let their dog officer know & he’ll check on them to make sure they really are cared for. Whew – I feel a lot better.
And thanks to all the BJ commenters for inspiring me to ask about this!
Barney
Perhaps some papers need something along the lines of the Scott Trust, which has owned The Guardian in Britain for several decades. It also owns a few other media properties, which tends to mean it is not solely dependent on The Guardian (and now The Observer) making a profit. However, it was set up by the family of the owner because they wanted the paper to remain independent. And that’s what you need – someone to give up future profits or the money they could get by selling a profitable paper to another owner, just because they want the paper to survive.
Little Dreamer
Well, the local paper I carry has recently added an additional day of ads.
They would probably manage more subscription retention though if they were to get the papers to the carriers earlier so that we have less late papers. I’m not late much, but, I usually have about 10 minutes to spare after I finish my route before deadline. I’m aware of other carriers who run late quite often.
Brachiator
@Calouste:
It’s not like the Ecnonomist or the NY Times are a couple of kids taking a newsletter down to Kinko’s for photocopying. The NYT balance sheet for 2008 is 46 pages; the Economist Group balance sheet for 2009 is more than 56 pages. Neither, as far as I can tell, show that operating costs come out of subscription revenues.
Even in 2007, when the NY Times ran a profit, total operating costs were $2,928,070,000 and circulation revenues were $889,882,000. Ad revenues were more than $2 billion.
It’s not a different busines model. The marketing materials for the Economist, much like that of the Times, promises to deliver high quality (i.e., got money) subscribers to advertisers.
Spend Analysis
I don’t think ground reporting is something that can be replaced by blogs