Breaking news, and breaking even (sometimes)

By guest contributor Karen Wirsig

It used to be that the capitalists who owned newspapers took care of the money and hired fleets of journalists mostly focused on covering the news. Sure, there were conflicts in this scenario. Lots of them. But it was a generally workable model for reporting to a mass audience and making money.

Now, not so much. Newspaper owners manage vastly shrunken newsrooms, their money-making strategies having ever less to do with employing journalists and more to do with cutting costs and holding onto curiously loyal major advertisers. That leaves a lot of people who still love the craft to figure out where their next paycheque is coming from.

Three such journalists were featured at the Canadian Journalism Foundation’s May 17 panel on “online news start-ups” in Toronto (the fourth guy being a consultant with an MBA). These guys are all conversant with terms like metrics, brands, apps, niche marketing, and sponsorships. Welcome to the new entrepreneurial journalism.

Three of the four — the journalists, as it turns out — pay their reporters and contributors. “There was always the idea at The Tyee not to be part of the problem,” said founder David Beers of the commitment not to follow in HuffPo’s footsteps. and also have paid newsrooms. (None of them said how much they pay; if you have any info, do share in the comments.)

OpenFile and iPolitics are infants, both having launched last fall, and they are not yet breaking even. Their founders, Wilf Dinnick and James Baxter respectively, have thus-far patient investors and bullish predictions of making money in the next couple of years. Dinnick’s project brings citizens into the editorial process and relies on these same citizens to promote the stories they want to see covered. His revenue model is based on advertising and sponsorships.

Baxter’s project has a Parliament Hill focus and aims to bridge the gap between the Hill Times — a weekly printed paper not designed for hourly updates — and the “episodic” nature of Hill reporting in the mainstream media. His revenue model is based on subscriptions for premium content as well as some advertising and sponsorships.

By comparison, The Tyee turns eight this year and Beers has no illusions that it will break even any time soon. “We’re set up to be almost anti-advertising,” Beers admits. He says The Tyee’s mission for “solutions-focused” reporting on sustainability and social equity doesn’t appeal to a lot of corporate sponsors, who tend to favour the notion of “unlimited growth.” The fact that The Tyee has maintained a B.C. focus means they can’t attract national advertising. They do have a committed following, however. During the recent federal election, The Tyee raised $25,000 from readers over a couple of days when they asked them to pay for the election coverage they wanted.

The Mark, on the other hand, invites experts to write about what they know best when there’s a news hook. Contributors don’t get paid in money; they get free copy-editing services, a chance at syndication with other media outlets, and a stoking of their reputations. Founder Jeff Anders said The Mark makes money — and in fact recently celebrated its first money-making quarter — by developing “content” and facilitating “conversations” among influential people. The federal government has paid them for their services, as has the Canadian International Council. When panel moderator and business journalist Andrea Mandel-Campell asked Anders if he could pay his contributors and still make money, he said no. Anders did say they might explore revenue-sharing since some of the contributions (a minority) do end up making money. So even revenue-sharing would leave the majority of his contributors unpaid.

None of these start-ups aims for a mass audience or sees themselves replacing the MSM. Dinnick says he sees these online start-ups working side-by-side with newspapers with “great brands” like the Globe and Mail.

Meanwhile, one independent online news concern attempting to reach a mass audience, Montreal’s Rue Frontenac, is facing closure by the end of the week for lack of an investor; its staff of 45 hasn’t been paid in three weeks. But that’s a subject for a future post.

Posted on May 18, 2011 at 1:05 pm by editor · · Tagged with: , , , , , , ,

2 Responses

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  1. Written by bk
    on May 19, 2011 at 1:08 pm
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    The Tyee really doesn’t pay much at all. Ten cents a word, last I heard. That’s not being part of the solution, in my opinion.

  2. Written by David Beers
    on May 28, 2011 at 11:30 pm
    Reply · Permalink

    Actually bk, much of The Tyee’s regular content is produced by a half dozen people who are paid reasonably, not amazingly but pretty darn well for a small independent, to cover beats. We also run regular contributors who are paid a negotiated ongoing rate for their columns allowing them to at least figure that not insignificant amount into their overall earnings. And, it’s true, the rest of what we run tends to be freelance paid at rates similar to what the major dailies pay freelanceers these days, their rates having dropped to around 15 to 20 cents a word.. We are not a major daily. Thus, I sleep at night knowing we’re not making the problem worse and, for some journalists, we are part of the solution.

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