Reading Reflections for Week 10 March 27

See syllabus for the readings. This week’s readings have a number of important concepts about different kinds of funding models for media-related startups.

Before class begins on March 27, respond to the following questions:

  • Based on what you’ve read here and learned in class so far, what do you think is the most promising funding model for the future of news and/or other types of media content?
  • Share one additional thing you found useful or interesting from the readings.
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21 thoughts on “Reading Reflections for Week 10 March 27

  1. In the Content vs. Service in media Education article I found this quote by Jeff Jarvis very interesting. “I find a disease among students that continues into careers, starting a pitch for a story (or in my program, a business) with the phrase, “I want to…” Playing the curmudgeonly prof, I tell them no one, save perhaps their mothers, gives a damn what they want to do. The question they should be asking and answering is what the public needs them to do.”
    There was a comment on the article by Arno Laeven that I thought was interesting as well. He said “The reason your journalism students say “I want…” is because they have never spent a day at a news desk or editorial team where everyday decisions are made about how to service readers with great journalism. The role of an Editor-in-Chief is to make sure journalists don’t ride their hobby horses too fanatically.”

    In Journalism this is so true, it’s not about what WE as journalists want, it’s about what the consumers want to read and hear about. I learned that from my first story writing for the Adult and Commuter Student Services Newsletter. My first article was just something I put together because my boss wanted me to write about it. However, when I put in the newsletter for students to tell e what they want to read about I started getting more feedback and interaction from them.

  2. 1. First of all, I really gave a lot of thoughts on this question. I am still not sure if I got it right. What is the most promising funding model for the future of news? Paywalls, crowdfunding, donations, advertising, that is what comes to my mind if I think about funding models. I do not think that one of these examples is a notable recipe for success. And the readings for this week drew my attention to other aspects that might make a future news business successful.

    I think a sustainable and successful funding model for the future of news is based on the fact, that you find and enter a niche market with your business. For that purpose, it is important to know your audience, to know the market, and to know competitors. Only if you know about your potential customer’s needs, you will find a niche you can build a successful business on. This is what I actually extracted from all the readings for this week.

    Chris Anderson, editor-in-chief of the Wired magazine, carves out the “long tail”, and thus describes how the business model of finding a niche market works: You serve a very small group of customers with very specific products or services. “Long Tail business can treat consumers as individuals.” And this might be the key for successful funding models in the news business: The multitude of very small markets. In contrast to traditional mass media, that are intended to reach a large audience, you focus on a smaller group of customers that has specific needs. Your product serves these needs, but as the demand is low, the sell volume is low as well.

    Nevertheless, the “long tail” business strategy indeed might be the right direction to choose in news business: From Anderson’s point of view, the “sheer size of it” is what makes the “long tail” successful. In other words, there are so many niche markets, that there are lots of possibilities for new businesses to focus on one of those small groups of customers, interests, and needs.

    Accordingly, as an entrepreneur wanting to start a news business, it seems to be a good idea to focus your product on a very specific topic or on a specific location. If you limit your coverage to only one neighborhood in a city, for example, your potential customers are probably only the inhabitants this neighborhood. But if you offer an attractive product and/or service, people will buy it.

    Furthermore, you have to detach yourself from the understanding, that journalism is only selling content, and that your revenue is measured by the content sold only. This leads me to another interesting assumption I extracted from the readings for this week: journalism must be a service.

    2. One of the most important steps before starting a business, according to the readings, is being aware of your customers. “Customers are your brand”, writes Jeff Jarvis in the “Service” chapter of his book “What would Google Do?” Using the example of remaking the business model of an airline (into a social airline), Jarvis essentially explains the importance of involving audience or customers. “The key is (…) giving control, respect, and organization to the customers, helping them find each other and organize into conversations and markets. The customers have value to give.” (p. 185, chapter “Service”) This may not only be true for aviation, but it is surely applicable to any kind of media business, too.

    Accordingly, selling content is not any more the only part of a successful news business. There must be services around this product. Sell experiences, lifestyle, create communities, share knowledge, build networks, is basically what Jarvis recommends. With these things a news company’s financial performance will be measured in the future.

    Mark Briggs also illustrates how important it is that you know your audience if you want to sell a service or a product. In the “Go to Market” chapter of his book “Entrepreneurial Journalism” he writes, that you must identify and study your market, know the audience’s needs, find gaps and use these gaps as an opportunity to build your business. Because the best product never gets anywhere (in terms of business and revenue), if potential customers don’t know it, don’t want it.

  3. Aidan Galasso says:

    1. I believe the best model for funding new journalism ventures is non-profit. The Pew Center’s report was hopeful for the future of non-profit journalism but it made it clear that it was not an overwhelming success. According to Jeff Jarvis this me be a result of non-profit journalists not thinking like entrepenuers. However, if news organizations take some of Jarvis’ advice and become hyperlocal or niche publications then the non-profit journalism model could work. Their startup costs would require donations at first and outside assistance. Many non-profits have people on their boards and in their business departments who are doing it as volunteer work and are not full-time employees of the company. If non-profit journalism companies sought outside help for their self-admitted problem of being able to handle the business side then they could focus only on the content, which is bound to result in that content becoming better. For a business to be successful the content is the most important part. The researchers at big hospitals don’t have to worry about the business side of what their organization because other people who are more capable of such matters take care of it. Colleges and universities also divide labor similarly and as a result are often centers of innovation and get contracts to do research.
    Journalists can enter into this same kind of market. Many government watchdog agencies are non-profit but they risk being biased due to lobbying interests. If journalists who are experts in a certain subject matter decide to break off from a major news agency and just cover one federal department then they are providing content that citizens need to be more informed and are doing it well because they are experts. If donations to these new media companies were tax deductible then philanthropists who were concerned with the state of government could help pay start-up costs. If the content was good enough these small publications could become profitable later. However, they would provide a useful service to legislators by offering unbiased content including data sets and field interviews about the impact of new laws. Similar to trade magazines they could charge for access to the content because it is done by trusted sources and is more thorough than content other organizations would be able to produce. Ideally they would be able to generate revenue by writing for local papers whose readers have interest in the agencies they are covering. They could even attract money from citizens who would rather donate $20 to a watchdog agency then a candidate to reform government.

    2. One thing I found interesting in the Jarvis readings was his idea of finding the standard for an informed citizen and creating content based off of this standard. I feel like the decline of the news business is a result of that standard being lowered. If people cared about truly being informed than they would pay for content. Jarvis talks about disaster coverage as a time when people need to informed but that traffic might not be enough to sustain a newspaper for an entire year. Local elections have such low turnout because the standard for being informed is low. Editors have said that people don’t want political news and only interest or entertainment stories. It seems that while Jarvis, a professor, wants more lists and interactive features regularly everyone else might want human-interest stories if they read the news. Survey data would have to be collected before any of Jarvis’ theories are proven true or otherwise.

    • Carrie Brown says:

      Good points about nonprofits – you are exactly right that they have to apply many of the same lessons as any other startup.

  4. I’m going to work backwards and first share something that I found interesting in this week’s readings: the Reuters article regarding newspaper paywalls (link). I have always been fascinated by the paywall system and watching those outside journalism react and voice their support or, usually, objection to paying for something that they have always known as being free.

    But are paywalls the best way to fund a newspaper?

    I think this line in the article is important: “The fact is that insofar as printed newspapers compete with the web, they compete with everything on the web, not just their own sites.”

    Like a newspaper on a coffee table competing with magazines, online news is figuratively speaking on a much larger coffee table with a much larger selection of alternative forms of information gathering and entertainment. Why would Jane Doe pay for digital access to the Commercial Appeal when she already spends most of her time on the internet looking at cat content on BuzzFeed?

    I noticed that the Reuters article was published in 2010, which brings me to my response to the first question: what is the most promising funding model for the future of news and/or other types of media content? I don’t think there is one model that stands out as the best option. I haven’t read any articles recently that seem to definitely determine if paywalls are helping or hurting the news industry. I have read compelling arguments from both sides of the debate.

    And I don’t think that there is a one-size-fits-all funding model, and I don’ think there ever will be. Crowd funding may work best in one instance, while venture capital may be the only option for a high-risk, high-cost startup. Perhaps someone from our generation will develop a new funding model that is adaptable to different needs.

    • Carrie Brown says:

      Good points. To some extent this was a bit of a trick question, since I don’t think there is any one-size-fits-all model, either. Paywalls are tricky. I’m more bullish if they have a meter.

  5. 1. Funding

    I don’t think that there is one funding model for the future of journalism and media that can be seen as the best one. Each kind of journalism and each media or media type do have different audiences, goals and thus different funding needs. Therefore, I will focus on future funding for local journalism here. Or more precisely a strategy for local journalism to survive at all.

    “Don’t give me stories. Give me lists”, Jeff Jarvis demands on his blog.

    Jarvis is referring a lot to data journalism when he complains about how some media do not yet fulfill the real needs of their users or readers. He demands platforms for communities where knowledge and data can be shared – much more data than what journalists alone could ever produce. I do not fully agree with Jarvis in this point: For me, journalists and their audience will surely grow closer together but will always be separated. Platforms can be useful and will certainly become even more important in the future. But they are not the answer to everything. For me, it is not the most urgent task of journalism to create platforms. They rather are an important addition to journalism, but storytelling and explaining complex issues will always be the core of journalistic work.

    However, when it comes to journalism as service, I fully agree with Jarvis. It already is an important survival strategy for smaller local media to focus on services for the reader. And I guess it will become more and more important. When local events take place or when natural disasters or other events affect an area in any way, it is helpful rather to provide service than just storytelling. This is where local media can stand out, this is their unique selling proposition. A nationwide newspaper or online news site cannot cover events in every small neighborhood. The different local media can. And in the moment they already do so.

    In the future they should focus even more on even more local stuff. This strategy combined with providing important and well-illustrated data and combined with the core values of journalism – to inform, to explain, to monitor – should be the local journalism of the future.

    2. Another thing I found itneresting about our readings

    On wired.com, Chris Anderson describes the concept of the long tail in a very precise and vivid way. A very interesting point about this is how traditional supply-and-demand-distribution might have shaped our taste in pop culture. The traditional market is depending on an inefficient distribution: Wal-Mart must sell at least 100,000 copies of a CD to make a sufficient profit. But as only very few products (music, books etc.) meet those requirements, only the really big hits count.

    For the long tail, there are completely different conditions. Not only is almost everything available in an online service based on a long tail concept. There also really is a demand for everything out there. The demand for a song, book or other product might be really low but it does exist.

    The way the concept works is to offer both: the hits that have a huge demand but also the long tail that only might attract very few customers. The effect on the diversity of our culture can be tremendous. As Anderson puts it: The long tail is “ending the tyranny of the hit”.

    • Carrie Brown says:

      Fantastic. You guys did really good work answering this question – that’s a great description of the long tail. I think you are right about local and that there isn’t any one model for funding news.

  6. The short answer is that I do not know the best or most promising way for news. As others have pointed out, there are so many options. All methods have advantages, but none have been able to get newspapers out of their funding predicaments. This may be a copout, but maybe the best way to proceed would be to combine different methods (targeted advertising, SEO optimization, pay walls, non-profit, working with citizen journalists and so on and so forth). Not every combination will work for everyone, but newspapers (and news blogs) can discovery what mix works for them. A theme in a lot of the readings is the idea of the “mass of niches” (Jarvis), and perhaps the mixing of methods will allow newspapers to develop and reach target niches. I don’t remember what author suggested the idea of local newspapers aggregating larger national and international stories in favor of spending large resources on covering diverse local/regional topics (maybe Shirky?), but this idea seems like something worth experimenting with regardless of the size and scope of your publication. Maybe the best way to move forward is to continue experimenting and combining different funding methods.

    I keep going back to the Jarvis book as being highly interesting. The focus is on Google, but really many of the concepts he writes about have much broader applications. I like that he is using one company as an example (And who wouldn’t? Google seems to being doing just about everything right), because it helps keep the concepts grounded and easier to grasp. I may have written about this before, but the idea of google and other services (Facebook) as platforms that fill fundamental needs for their users. On top of that, I mentioned in the above paragraph the idea of the mass of niches. Again, this is a concept that Jarvis applies to Google, but the idea itself has much broader implications.

    • Carrie Brown says:

      Yeah, that’s why I required the Jarvis book – I think the underlying concepts here are really applicable to a lot of things you guys are going to encounter. Not a copout – it’s kind of a trick question, because I don’t think there is “one” answer – but probably a combination of many answers.

  7. reigningace says:

    Funding models to me are the hardest part of producing media content. There is always the idea of we have to get something back for what we produce but there is no way to standardize this form of payment. In news today we see paywalls, advertisement, and subscriptions, and in music you see material album sales iTunes with singles or album sales and Spotify with subscription sales. Really the question is do we want access or ownership and as the creators do we want to grant those liberties. There are also news organizations doing non-profit content and those don’t do well and function on a much smaller scale. It depends on the size and the amount of content you want to create for the funding model.

    The other thing I found interesting is the long tail approach. I never though about the idea of provide and they will come in terms of niche markets being served by large organizations. This has definitely worked for e- readers in terms of kindle. They have created new genres from the long tail concept such as new adult. This readership sparked with books such as 50 shades but is definitely what has helped companies like Goodreads gain traffic. This is because Amazon and Kindle have watched what reading trends there are and the power of the review. According to Reuters, Kindle is the most used reading app in the world and this is due to their cheaper prices on Amazon and the convenience of the one-click buying mechanism. Anderson discusses this with his second rule of the long tail “cut the price in half, then half that.” I feel Amazon and kindle have maximized on this model.

    • Carrie Brown says:

      Good – yes, long tail has had quite an effect on Amazon and books – of relevance of course to your startup.

  8. Barry Parks says:

    Funding:

    I have a wealth of distinct memories from my days of undergraduate internships at Atlanta television news stations. Unpaid on-the-job-training, as it were, I learned nearly as much about the craft and application of broadcast journalism in those settings as I did in any classroom. So even though I didn’t have a paystub to show for it, what I gained was probably worth more than a salary.

    That experience was far from what long-time ABC Atlanta evening news anchor Monica Kaufman was enjoying during those days. In perhaps my MOST memorable memory from my role as Kaufman’s intern for her “Closeups” celebrity magazine show that was popular during the late 1990’s, somehow I learned of her salary. In 1997, she was earning some $750,000/year as the iconic Channel 2 Action News ‘face.’ I’m pretty certain I went back to my tiny apartment the night I learned thatto simultaneously cry into an unsatisfying can of Spaghettios about how far her reality was from mine, and to hope that someday I could be in a position like Kaufman. I wanted to be a broadcast journalist for more reasons than the money, but hearing her figure made me hopeful about even a fraction of that income.

    But beyond mere paycheck envy a distinct feeling of unlikelihood for my own future bank account, hearing that information about Kaufman’s compensation in 1997 opened my eyes to a facet of the news business that journalism classes really didn’t discuss to any length: operating a news outlet costs money, and alot of it. Indeed, Atlanta was a top-10 market in 1997 and operated on a different budget than the bulk of other stations in the country and than alot of the types of startup organizations we discuss in class. But that unfathomable figure I learned about one anchor’s annual salary brought it home in ways I struggled to wrap my brain around. “There MUST be some serious advertising dollars going on in this business,” my feeble young mind mused.

    A quick survey of salary figures alone in the Memphis market today reflects that while Kaufman’s 1997 salary might’ve been exorbitant and atypical, it’s still expensive to produce television news when some anchor salaries themselves can still range near half a million dollars. And with ever-increasing competition from myriad other news outlets that didn’t even exist during my undergraduate days when Kaufman was bringing home her bacon, I can only imagine how much more of a challenge it is for a tv news station to pay the bills in contemporary society.

    How do they continue to do it, and how will it continue in the future?

    I can only see advertising as the pivotal function for generating the kinds of revenues that are needed. Perhaps it’s a function for me of how Jarvis explains that as we get older, we can’t see past the former ways of doing things to adapt to and accommodate new or more ingenious ways of doing things. I have read all the information about paywalls and nonprofits and diversifying revenue and venture capital, etc. But all of those concepts must clearly pertain more appropriately to startups and niche-based news outlets. When you’re talking about a series of 6-figure salaries, not to mention technology and infrastructure investment required to operate a major-market television news outlet, it MUST be about a talented and aggressive sales team and some healthy advertising income.

    Advertising is inevitably important for startups and niche news sources as well. As Briggs points out, media scarcity is no longer existent. There is a new abundance of ways and means for companies interested in selling goods or services to place ads in the internet age, and online news and media startups have to capitalize on this. As Briggs further points out, it serves a fledgling online news source well to have reputable advertisers on board. Beyond helping to pay the bills, the right kind of advertising helps to establish credibility by serving as a sort of well-established reference. I have found myself thinking along those very lines lately while watching LogoTV, which has recently started airing Las Vegas commercials. That the network has become able to land ad accounts of that caliber (either on its own merit or through its affiliation with Viacom) seems indicative to me that the network has developed a little viewership muscle. That equals credibility in my estimation.

    To suggest that advertising is the ‘be all, end all’ source of funding for the news–mainstream broadcast media and otherwise– is not to overlook the viability of other modes. But for my capability at understanding how to meet the high mark for television newsroom budgets, a healthy advertising income must remain in force for the duration.

    2. Other insight:

    Jarvis hit me between the eyes on–yet again–the age issue in his chapter titled “Money.”

    “As investments get smaller, entrepreneurs are getting younger.” That’s not the kind of thing a 43-year-old guy in graduate school wants to hear over and over, but doggone it, it’s accurate. So-called digital natives are the incumbent ‘surfers of the wave’ as our society lurches increasingly forward into an age of new digital turf. Young people whose lives have always had a relationship with the internet are exponentially far more conditioned to consider what can be done–and are far more likely to attempt to do it–as compared to those of us who existed before the still newly-developing means of technology and digital advancement. Members of my generation are perennially forced to re-mold our way of thinking and to learn new functionalities. That all rather gets in the way of entrepreneurialsim for older generations, when for the digitally intuitive and the fresh-minded, ‘bull-horn-grabbing’ is innate.

    I insist that old guys can still make it happen. Anyone who is industrious, capable and willing can be a success in the digital world or otherwise. Older generations can also certainly contribute experience and knowledge of a more abstract nature, and that certainly has its place in entrepreneurial development.

    And meanwhile, I can’t deny that part of me is actually starting to enjoy my own ‘digital immigrant’ experience, hovering somewhere between the reality of those ‘never-exposed’ and the digital native reality. It’s compelling to live in this era at my age where I’ve enjoyed the ‘before’ and the ‘during.’ Gaining the exposure that going back to school at this point in my life is offering can likely put me in a place where I can assist those older than me who might still need their first introduction to digital orientation and entrepreneurial thinking. I’ll likely just have to do that as an employee of someone far younger than me. And I can totally live with that. 😉

    • Carrie Brown says:

      Good points. Keep in mind though that compared to other kinds of television programming, local TV may be relatively cheap to produce….there’s a handful of very highly paid people, but most others are paid little and the staff size is often extremely small for the number of hours they are on air. I do think, though, that a big push now is to convince advertisers they need to pay more not for volume of eyeballs but for the fact that their product will be associated with a quality brand. Good thoughts on age, and I think that the only real advantage younger people have is that they often have less commitments and therefore less to lose, but I think there are plenty of smart innovators of all ages around.

  9. Ketevan Dolidze says:

    1. After completing the readings for this week, I think there are a few things that can make a promising funding model for the future, like advertising, paywalls, donations, etc.
    They all do have similarities and differences but can be extremely beneficial, if used in a proper way. But I really could not agree more with Robert – that success, a lot of times, will depend on entering a niche market. This is where too many startups fail, in my opinion. They do not truly study the wants and desires of their potential customers and sometime, they do not really know enough about their competition. We spent so much time in class developing all these steps with our startups and really attempted to understand our competitors because the future of the startup may depend on it. If I studied the competition and narrowed down my audience, I can now start developing my target audience and my funding model, which will fit in with my niche market.

    What I really enjoyed reading was The Long Tail by Chris Anderson, who goes into more details about finding the niche market and making it work for one’s benefit. Anderson gives great examples of how in order to make money movie theaters will only show movies that they know will be high in demand or that will have large audiences. Not all movies will be shown at every movie theater because data about peoples’ interests is pulled usually from about 10-mile radius. If the data is showing that that particular movie will not be popular in that 10-mile radius, that movie will not be shown in any of the movie thereat within those ten miles. This simply shows that one must know its target audience or its market in order to succeed. We, as people, will want to see the popular shows, movies, or listen to the most popular song. As Anderson states: “Great songs, movies, and books attract big, broad audiences.” He later continues to explains the importance of finding the niche market and targeting that exact market. There are too many people in the world with different preference and it is extremely difficult for a business to satisfy all of those people at once. Anderson points out Rhapsody, a great example that is actually doing really well at trying to reach out to as big of an audience as possible. It adds new songs constantly and as soon as those songs are added, they find new listeners, even if it just two or three.

    One of my most favorite things about Anderson’s theory is his Rule 2: “Cut the price in half. Now lower it.” This is very beneficial to us as we are trying to come up with the prices for our startups, or the apps. It is extremely difficult to decide on a fair price – one that people will actually be willing to pay. Anderson shows that you can get your questions answered if you just ask consumers and take their suggestions. They will be able to let you know whether the price is too high or low, and whether they are willing to pay that amount to obtain what you are offering.

    2. Another thing that really sparked my attention in this week’s reading is Jarvis’ take on the law or lawyers in his Exceptions chapter. Though I decided against law school (for now, at least), I’ve worked with plenty of attorneys and observed the way they conduct their business. I completely agree with Jarvis, “law is business” and essentially an attorney is representing his client and is restricted in his way of thinking. Being a good attorney is not just about having the facts needed to win the cases, but also knowing how to spin off those facts and tell a story. Attorneys cannot make mistakes because as Jarvis points out, they are not paid to lose but are paid to win. I think one of the best parts of this chapter is when Jarvis states that “sometimes lawyers are employed merely to intimidate” and again, I could not agree more. I have seen this happen so many times and it definitely shocked me. Even though I knew this happened I never thought that it would actually work in the court of law. Most of the times, though, the case does not even go to court because the opposing side is simply scared of all the legal proceedings, especially if there is an attorney involved. The rest of the stuff he mentions about freeing the law, I believe, is already out there. There are numerous forums out there where people, who have been involved in legal proceedings in the past, offer up their opinions on how they handled it all. However, where you must be careful is when those people, maybe without even realizing it, are giving legal advice, which is against the law (unless you are an attorney, of course). I believe that is the only threshold for those who are truly attempting to help other in similar situations.

  10. Based on what we’ve read, what we have discussed in class and what I have observed from customer feedback on my groups business ideas I think we are approaching the issue of funding news and media wrong. Why should there be one set model for funding.
    Take each group for example. We all have very different start up ideas that cater to different customers with different needs and behaviors. Back when we were reading about the culture of organizations and businesses we learned how difficult it can be to change that culture.
    Likewise, it can be very difficult to change the culture of your customer group. (And yes I believe all of our customer groups have not only a set behavior but also a culture.)
    Based on what that culture and behavior is, we can see how to make money off of these types of people. A free-spirited mid twenty year old male living in an urban city more than likely will not pay for something he can take five more minutes to google and find. But someone a little older with a higher income would.
    We also need to look at what we are offering. The price will also depend highly on the product (magazine, newspaper, online vlog or blog, podcast, app, etc.). Some things cost more to make and make more sense to be free or nonprofit.
    This brings me to my favorite part of the readings; Jarvis’ stress on knowing your customers. He brings up the importance of customer feedback and allowing them to get to know each other and start conversations. On the aspect of customer feedback I think it is 50% of the process. How would you know what to sell if you don’t communicate with your customers??

  11. Robin says:

    While contemplating revenue streams for traditional and “new” media journalism companies, It became hard to focus on solely journalism. As we all know, even though I have an undergraduate degree in journalism with an emphasis in advertising, I have never really worked for what one would call a news organization. I have never been a reporter, editor, or broadcaster other than In the superficial capacity of internal and external newsletters, social media sites, a short stint on the school newspaper, or as editor of my high school yearbook. However, I have grown up listening to stories about the days of newspaper men and their typewriters alongside stories of the 3 martini lunches for the advertising professionals. I decided to try and focus on what I, as a consumer of news, have found to be interesting or a revenue model that I would potentially try if I were to join a startup.

    Being the last person to write this post, I was able to take a look at what my classmates found to be valuable revenue models and I have to say that I agree with the statements made by most of them. Zach’s opening statement – “The short answer is that I do not know the best or most promising way for news. As others have pointed out, there are so many options. All methods have advantages, but none have been able to get newspapers out of their funding predicaments,” along with Kelsey’s question “Why should there be one set model for funding?” pretty much sums up exactly what I was thinking. I feel that there isn’t one model that works well for all news organizations or for all of any type of organization. It’s like telling someone how you lost weight or how you quit smoking – it’s great advice for someone to draw from but what worked for you, may not work for them. There isn’t a one size fits all revenue model nor is there really a one size fits all piece of clothing.

    First, let me say that I HATE a paywall. I know, I know – some people believe that it is a great way to recoup lost print subscription funds and as Rupert Murdoch says “Web users will have to pay for what they watch and use.” But, I don’t see it that way at all. I much more agree with Shirky, when he commented on Rupert Murdoch’s quote along with those of Diller and Brill by saying their statements actually mean that ““Web users will have to pay for what they watch and use, or else we will have to stop making content in the costly and complex way we have grown accustomed to making it. And we don’t know how to do that.” Paywalls to me are a sign of a company at the end of it’s rope – they have tied a knot around it and are hanging on for dear life. When I get to a site that asks me to pay to read the article, I think one of two things. Either, that the company is quickly heading out to pasture for retirement or that it is run by a bunch of egotistical snarky old men who don’t deserve the “click” on their website that I just gave them. Either way, I close the browser tab, head on over to Google, and search for the topic of the article. Guess what? I always find it. It’s not as if I suffered some great loss. I don’t care which company I read the news from, MOST of the time and I am ALWAYS able to find it somewhere else – probably because today it seems that there is a reporter’s Costco where everyone purchases the same topics to write about and very few head over to the local and organic market of news and choose an original topic.

    Advertising seems to be the only model that would work for most news organizations and even then, it works better for some, more than others. Nonprofit organization is an amazing idea and has been done well by some, such as Pro Publica. However, the main issue as I see it, with a nonprofit model is that it only fits a few types of news organizations. You wouldn’t have a nonprofit model if you are a Nick Denton and run a Gawker type company – it just wouldn’t work. Some have said that the problem with a nonprofit revenue stream is that it relies on several big donors who will eventually die and then the company will be left searching for funds. I don’t see this as the case. There IS money out there. In fact, there is a TON of money out there. The only problem is convincing the people who have it that you are the “pony” on which they should place their bet. For someone like me, I don’t see it as all that difficult. AS a person who is accustomed to raising money for nonprofits, I feel that the same principles can easily be used by news organizations. It’s all about the staff, the research, the time, and of course, the ask.

    That brings me to the question you asked about what I found most interesting in this week’s readings. I would easily say the quote by Kate Barr, Executive Director of the Nonprofits Assistance Fund, in the Pew Research Report on Nonprofit Journalism.

    “Organizations starve themselves,” says Kate Barr, executive director of the Nonprofits Assistance Fund. “There’s an obsession with being able to say to [funders] that 80 to 90 cents of every dollar you give us is going to programs.”

    She hit the nail on the head in more ways than one. This is a serious issue with nonprofit organizations of ALL types, not just journalism nonprofits. The obsession with “starving themselves” has caused a multitude of issues over the years.

    While reading the introduction to the report, I kept thinking that the problem with many nonprofits is the fact that they don’t understand just how important it is to PAY their people WELL. Like I said earlier, I have spent a great many years working for nonprofit organization and have grown up with two parents who have run their respective nonprofit organizations. The thing we always discuss at the dinner table is that nonprofits always talk about how it is hard to raise money and how they NEED help to do so. I immediately began thinking about these conversations when I read the following:

    “More than half of the nonprofit news organizations surveyed by the Pew Research Center in late 2012 (54%) identified business, marketing and fundraising as the area of greatest staffing need, compared with 39% who said the top need was for more editorial employees. In addition, nearly two-thirds of the nonprofits (62%) cited ‘finding the time to focus on the business side of the operation’ as a major challenge-compared with 55% who cited ‘increasing competition for grant money.'”

    Of course, these nonprofits say that they need business staffing or as Pew put it, “the business-side resources needed to effectively expand their revenue base.” The problem is that most don’t want to INVEST in what they NEED. I have been surprised at how many times in the past two years that political nonprofit organizations have begged me to help them with fundraising but have only offered me commission. Personally, I have a huge problem with raising money on commission. People expect for a sales person to get a percentage of the sale, but no one expects when they are approached by someone asking for a donation, that the person will receive a portion of said donation. Nonprofit companies need to bite the bullet and wake up! You can only make money by spending money and the most important person to the organization’s future is the marketing, PR, and development person because they control the influx of donations through which your company runs.

    When it comes to news/media organizations though, I have found there to be an issue between the “journalist” people and the “business” people when it comes to the way things are run. The “journalist” people want to do things for the good of others and many times at the detriment of the organization (by spending money in places or for causes because “it’s a good cause”) while the “business” person is sitting at the board room table screaming “NO NO NO!” Not because the “business” person doesn’t believe it is a good cause or because they don’t want to “do good,” but because they understand that it will hurt the organization’s finances and at the same time, they know their position will be the first one the company gets rid of when the budget gets too “tight” to continue in the fashion the board is used to. I have been there, seen it, and have been let go because of it. The sad thing is that these organizations are making two mistakes at the same time – one, spending simply because “it’s a good cause” and two, letting the one person who brings in money go. The organization always falls on harder times after this decision because they now have NO ONE working on bringing in donations by which the company runs. It’s a vicious circle but I believe the answer is for organizations to realize that they can cut spending in various places and in various amounts in order to PAY the marketing, PR, development person WELL, because this is actually a NEED not an option.

    This post has lasted longer than I meant for it to, mostly because nonprofits are near and dear to my heart and I’m extremely passionate about this particular issue but, I want to sum up this week’s topic of revenue streams by saying that each company or organization no matter what field they may be in, needs to find their niche and really understand their market before choosing a revenue model. They also need to be willing to say “Wait – we were wrong. This model isn’t working. On to the NEXT” before they waste time and get to a point of no return, business-wise.

  12. Based on what you’ve read here and learned in class so far, what do you think is the most promising funding model for the future of news and/or other types of media content?
    *For this, I can honestly say I’m clueless. I would love to have an in-depth solution, but I have seen the pitfalls and failures of news orgs trying to find out their best funding model, from paywalls to advertising and more. Honestly, I think it’s less about trying to reserve information and more about building successful brands. Lets look at Beats By Dre. These headphones also come with a live streaming music platform and there are many of those out there. Why are they so successful that Apple wants to buy them for $3.2 billion? It’s the brand behind it. Mind you, these are very different than media organizations. What I have seen work well is giving information out for free – then having ads pay for the content. It’s an age-old model but it is what is working in an information age. Advertising helps to keep the lights on, but what will help growth? Maybe if there were media programs and organizations tied to a specific cause instead of several beat stories. Take the newspaper run by Rhodes students that allows homeless people to purchase papers for 25 cents and sell them for a dollar. It’s not making millions, but it’s built around a specific cause and many of these people have actually been able to move into housing because of it. What if organizations did more of this, with a higher impact? Just a thought.
    Share one additional thing you found useful or interesting from the readings.
    I have read the book on the Long Tail of Marketing before, and it is one of my favorites, so much so that I am able to explain that technique today. I’ve always loved this concept, mainly because it enables smaller individuals who don’t have the resources needed to get themselves out there a platform to sell their merchandise. With no shelves needed, companies can display any and all forms of media. It’s a great concept, and one that I am implementing in City Box.

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