News Leadership 3.0

Posts tagged with: Chicago Community Trust

February 11, 2010

From Chicago: A snapshot of online news experiments

Despite the demise of Chi-Town Daily News last year, Chicago enjoys a lively news environment. Chicago’s experiments may help us understand and shape an emerging new media landscape.

I interviewed operators of three Chicago online news sites - Gapers Block, Windy Citizen, and Chicago Talks - recently and found the mix of content and revenue ideas worth following. I’m adding several Chicago sites to my list of promising online news sites.

Gapers Block

Led by Andrew Huff, this site is aggregates and offers original content, mostly from about 80 volunteers (professional journalists, other professionals, students and others), edited by eight professionals who receive small stipends.  It is expanding its original offerings with a grant from the Chicago Community Trust.

Gapers Block, Huff says, is a Chicago expression for “rubbernecking” or stopping to take a look.

“We’re pulling out the news you may not have seen. We cover in brief ways the big stories of the day. What we really like to do is cover the stories that got buried and you have missed and bring them to the forefront. We’re trying to send people other media,” Huff said, who founded the site in 2003 after an unhappy stint in public relations.

The volunteer writers stick around for about a year, Huff said. The site relies on advertising revenue and Huff draws a small salary.

“We’re are a pretty collaborative effort. It’s a pretty flat structure. I’m writing constantly for the site so it’s not some guy up on high. Because we have such a good reputation in the media and in organizations we cover, (writing for the site) attractive. It’s a little bit of cachet to say you write for Gapers Block.”


Windy Citizen

This site, founded in 2007 by Brad Flora, aggregates links to the interesting stories of the day.  Flora and two interns prime the site. It has an engaged community of users who vote stories and comments up and down. User votes play a significant role in determining what stories rise to the front page of the site.

Advertising is the main source of revenue and Flora says the site makes $5-10,000 a month. In August, he hired two part-time advertising sales people. He thinks he needs to double or triple his user base to be a sustainable business and is using grant funding to improve his content management system to support more users.

Flora believes his two core user groups are attractive to advertisers - Young people in their 20’s or early 30’s who like the off beat news and 50-60 somethings who want a place to discuss politics.

In general, Flora says the discomfort journalists experience when trying to make money holds many sites back.

“The sites are too small. They are run by people who are afraid to ask for money. The journalism curse. My plan was to get big enough that I could attract someone mean enough to sell advertising. Journalists are not comfortable doing that. They can make a fine product, but they’re under pricing advertising, they’re not very good a presenting it, at working the phones. These are all things I struggle with personally.”

Flora also says he’s encouraged by the second wave of large non-profit news organizations such as Texas Tribune who are coming on line with the know-how to raise money.


Chicago Talks

This site draws most of its content from Columbia College students. The school provides support including editing by faculty and grad students.

Site content focuses on original news that others aren’t covering and aims to produce at least five original stories a week. Suzanne McBride, associate chair of Columbia’s School of Media Arts, said content is fairly traditional and consists of news, not opinion.

McBride said the site turned primarily to students after finding citizen contributors were difficult to rely upon on a consistent basis
.
With expansion grant funding, the site will pay teenagers and provide them with transit cards to report on the Austin neighborhood, one of Chicago’s most challenged.

McBride and Columbia College’s Nancy Day said the site ultimately must create an advertising revenue stream, which may prove difficult in neighborhoods such as Austin that have low income residents and relatively few commercial operations to form a pool of potential advertisers.


Chicago News Cooperative

While I did not interview anyone from the Chicago News Cooperative during my visit, I’d be remiss not to mention this newcomer. Funded by large start up grants from several foundations, the CNC employs professional journalists who focus on politics and policy in the Chicago metro area. It provides content for The New York Times Chicago edition two days a week. Launched in October as a not-for-profit, it fills the role of a traditional alternative to established newspaper organizations. The site promises to “introduce novel ways to connect the community with our news room in a two-way exchange of information.” I asked founder and editor James O’Shea via e-mail to elaborate on that and I’ll report back on what I learn.

(Disclosure: All four of these operations recently received expansion grants from the Chicago Community Trust as part of the Knight Foundation Community Information Challenge. I was on the CCT review panel as a consultant to the Knight Foundation.) Knight is opening another round of the competition and you can apply here.

None of us knows what models for providing news and information will survive. But I think these four sites—three of which have found very inexpensive ways to create content and attract a community of users and one that is attempting a focused professional model—underscore the idea that a diverse mix of media may serve the information needs of communities rather than one large institution.

For more information about the news ecology of Chicago, check out this study commissioned by the Chicago Community Trust, “The New News: Journalism We Want and Need.”

Please join the conversation about online news start ups and new models for news. If you have suggestions for my list, please add them in comments below. You’ll find my list of promising sites here and the criteria for the list here.

(This is cross posted in the Reynolds Journalism Institute blog.)

September 23, 2010

Audience engagement and business sense are essential to success of local news start ups

Do local online news sites fail because there is no revenue model?  I suggest an alternative explanation: Online start ups often struggle because their leaders don’t know enough about running a business or making money on the Web (and some don’t want to learn)

I wrote this essay for “Realizing Potential, What Chicago’s Online Innovators Need,” a report by The Community Media Workshop. The report was commissioned by the Chicago Community Trust, a foundation I work with as a consultant to the Knight Foundation Community Information Challenge. The Trust will be releasing a series of fascinating reports on the news media landscape Thursday afternoon. Visit communitynewsmatters.org for details.

We’re seeing an explosion of local online news startups across the United States.

Key drivers: Jobless journalists start independent sites. Technology is easier to master. Community leaders and organizations step up to help fill gaps.

This is very evident in Chicago, where dozens of sites and blogs are providing news and information, and The Chicago Community Trust and other organizations are working to support the emerging news ecosystem.

Even so, sustainability is a key challenge for most online news publishers.

Mainstream media sources often suggest sites fail either because it’s just too difficult to make a go of independent online news or because there is no obvious single source of revenue for news (like there used to be—advertising).

I suggest an alternative explanation: Sites struggle because their leaders don’t know much about running a business or making money. Often, the leaders are journalists who are downright uncomfortable even talking about selling ads or raising money.  Worse, they pin hopes on a single stream of revenue rather than planning for multiple sources and fail to plan for the time when they have enough people using their sites that they have something to sell.

Absent obtaining a grant that guarantees their independence and reinforces the idealistic notion that journalism is a public good rather than a product in a market, journalists can be just plain lost when it comes to making money from online news.

Still, many online news publishers are working on revenue and are optimistic that their local sites can be sustained.

As a fellow earlier this year at the Reynolds Journalism Institute, I developed a list of promising local news sites—both for-profit and nonprofit. We surveyed their publishers to identify best practices and key challenges they face.

Many publishers told us that engagement and community building are central to their sites.  While their top priority is creating original news content, engaging and building community is a close second.

Some see community engagement as key to business success.

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

Engagement may be a particularly strong factor for sites that chose to develop a membership or individual donations model, like that of National Public Radio.

Other sites are making money by hosting events and selling syndication rights to their content to other sites and publications.

Sponsorships are another vehicle that both for-profits and nonprofits can exploit. They may look like advertisements, but the buyer is paying to be associated with the site, rather than for potential click-throughs to the product advertised.

Still, our survey found that online local news sites rely most heavily on advertising for revenue. On average, advertising accounts for 45 percent of site revenue. Nearly half of the sites reported that 75 percent or more of their revenue comes from advertising.

Grants are the second largest source of revenue, followed by donations.  Other sources such as sponsorships, subscriptions, memberships and services account for miniscule amounts.

While most of the sites report revenue and about one-fourth said they were profitable in 2009, three-quarters of the publishers said they are trying to increase revenue.

It’s clear that this will be a process of trial, error and experimentation around revenue. In Chicago, a couple of examples of exciting ideas are evident: Brad Flora of WindyCitizen.com just won a $250,000 Knight News Challenge grant to develop Real-Time Ads. The Chicago Community Trust is facilitating learning and discussion among local sites about forming an advertising network.
Chicago is not alone as a local news innovation space. In Seattle, for example, many neighborhoods have competing news websites, entrepreneurs are creating advertising and content networks, and the major traditional news organization, The Seattle Times, is partnering with local sites and bloggers. One of those partners is West Seattle Blog, a site that shows that the right combination of location, community, commitment and advertising know-how can create a profitable and valuable news source.

The story is the same all over the country. Patch.com, America Online’s entry into the micro-local marketplace, is evidence that an organization that is primarily about revenue and the web sees dollar signs in local advertising.

Whether an experiment fails or succeeds, the generalizations that seem to dominate mainstream media coverage do a disservice to important learning about the new local news landscape. Most of the field is still about trial and error. Until we define effective practices, how can we say whether a given model works or not?

Eric Newton, vice president for journalism programs at the Knight Foundation, describes a three-legged stool of the expertise needed: journalism, business, web.

I would also note the three roles overlap in ways that require reinvention of the church-state division of journalism from revenue generation.

That doesn’t mean every journalist should now be selling ads between reporting assignments. But clearly, the journalist must focus on engagement and value—as defined by the community—and must understand web culture and how to connect within it; the web specialist must not only build websites but must see technology through the prism of user preferences and community building; the business specialist must aggressively generate revenue in ways that are consistent with the brand, which is another way of staying consistent with how the site’s community sees it.

That approach ultimately will create diverse paths to sustainable community sites.

(Revenue and sustainability are key topics on the agenda of Block by Block: Community News Summit 2010 which starts Thursday evening and runs all day Friday. Find the live stream and blog here, follow bxb2010 on Twitter, or check out an informal conference blog here.)

 

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Exploring innovation, transformation and leadership in a new ecosystem of news, by journalist and change advocate Michele McLellan.

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