News Leadership 3.0

April 26, 2010

Seeking sustainability: The business of nonprofit journalism

Community connectedness and diverse revenue streams are critical ingredients for success for nonprofit news organizations. That’s my headline the conversation at the Knight Foundation‘s “Seeking Sustainability” roundtable discussion of about 50 people representing 18 nonprofit news organizations Monday in Austin.

Most of the organizations represented here are ones I have dubbed the “new traditionals” on my list of promising sites at the Reynolds Journalism Institute. These are sites that employ professional journalists to produce quality news content - whether local, statehouse or investigative. But as I listened to representatives of these organizations talk about their mission, I was struck by how different they sound from the “old traditionals” like the newspaper newsrooms where I worked.

We used to talk about serving the community. But with the advertising dollars flowing, we didn’t really depend on our communities and as a result, we didn’t always know them or reflect them effectively.

So it’s refreshing and inspiring that the leaders of these “new traditionals” see community engagement as a vital component of their future sustainability.

“Now we can build system that can thrive because of the mission thriving. The key to this, the key to sources of revenue is the creation of a community and engagement,” said Scott Lewis, CEO of Voice of San Diego. Lewis says news organizations need to think of themselves as educators, as “stewards of conversations” that support “a higher sense of learning and engagement with issues.”

“Our name and our success is based on our investigations,” Lewis said. “But we are still struggling to engage people, to talk people along on this journey with us” by including context and background. One feature on the site, San Diego Explained, gives users the back story on news of the day.

Paul Bass, of the New Haven Independent, said community has been the core mission of the site. “We cultivated a community. We’re a journalism driven community.”

Many of these nonprofit sites have started with grant funding (the nonprofit version of venture capital it would seem.) While some sell advertising, it is not a central revenue stream of many sites. Instead, the discussion today focused on:

- Memberships on the NPR model. Lewis said Voice of San Diego has a membership renewal rate of more than 70 percent with a fairly rudimentary system.

- Sponsorships. Susan Mernit, founder of Oakland Local, says she sees sponsorships as an ongoing source of income while advertisements on the site will be primarily event-based. Bass said the Independent sells sponsorships, not ads. He pitches sponsorship as an opportunity to be associated with good journalism content.

- Events. Texas Tribune believes hosting events will be a significant part of its revenue stream, said Chairman John Thornton. (Here’s an interview about the Tribune’s revenue strategy.)

- Syndication. California Watch sells other publications rights to use its stories at very low fees, ranging from $50 to $500 depending on the size of the publication. As the organization localizes and tailors content more to a specific publication it may be able to charge more, said Mark Katches, editorial director. Voice of San Diego sells two features each week to a local television station, Lewis said.

In contrast to the pay wall debate in established media, the nonprofit leaders spoke about the need to push their content out, mostly for free, to other sites in order to raise their profiles and grow their audience and create value.

“The real value in what we do is in secondary or tertiary publishing. We distribute across networks. That is the real value. It’s the most important thing,” said Evan Smith, CEO of Texas Tribune.

Another indicator of the “new” in “new traditional” on the Web.

(This is cross posted at the RJI blog.)

By Michele McLellan, 04/26/10 at 8:29 am
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(And five minutes later, I’m logged in to comment!)

Great post and a helpful summary of the sustainability spectrum.

Phillip.

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