The New News Economy 

As newspapers struggle, nonprofit news is being touted as the key to the future. Is it?

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But what's symbiotic today could turn malignant tomorrow. Clearly, there's an inherent tension to the new news economy, one that could, conceivably, be the undoing of both for-profit and nonprofit news organizations. Right now, most journalists and media observers would likely agree that the relationship is working out on both sides of the equation: Nonprofits get distribution and a chance to effect change, making their donors happy, while newspapers get content for far cheaper than it'd cost to produce in-house. But at a moment when papers are laying off their staffs in droves and cutting costs at every juncture — and, at the same time, when nonprofit news is growing like never before — it's not hard to see a future in which that balance shifts. The great promise of nonprofit news is that it provides a cheap and reliable way for papers to fill pages with fewer people — but what happens if and when newspapers come to rely on it too heavily?

Proponents of nonprofit news argue that there's no causal relationship between the rise of nonprofit news and the demise of commercial news, even if the former benefits from the latter. Kevin Davis, the CEO of Investigative News Network — a consortium of more than sixty news nonprofits — argues that the problems facing mainstream newspapers are endemic to their advertising model, which started deteriorating once advertisers found better options than "juxtaposing [a] display ad with content that may or may not be on point with its marketing message."

Jeff Hermes, founder of the Digital Media Law Project, agreed that most nonprofits have a mutually advantageous relationship with their for-profit partners, particularly in an age of newsroom bloodletting. Rosenthal, who himself was ousted by The Philadelphia Inquirer for cost-cutting reasons far earlier than the existence of organizations like ProPublica and California Watch, pointed out that "the downsizing of newsrooms began long before there was this model for nonprofit investigative reporting." News analyst Steve Outing argued, furthermore, that traditional periodicals have always relied on the AP, and so far, it hasn't rendered them moribund.

The problem, though, is that even though newspapers have been in trouble for a while, the ante has been upped considerably in recent years — and, moreover, that a nonprofit like CIR is quite different from a wire. While it's understandable that a metro newspaper like the Chronicle wouldn't have adequate funds to open a bureau overseas to cover the European debt crisis, the notion of hiring another outlet to cover local news because it's cheaper is a much dicier proposition. In reality, Chron reporters are perfectly capable of covering most of the stories that California Watch publishes — the real problem is that there aren't enough of them. And the danger of running CIR stories to supplant regular Chron reportage is that an influx of outsider bylines would undermine the Chron brand.

Whether or not readers actually notice journalist bylines has long been a point of contention in the news world. Rosenthal insists that they don't. "To be honest, I don't believe people outside the journalism world pay attention to bylines," he said, offering an example: "The average person, if they read a story by Zusha [Elinson, The Bay Citizen's transportation reporter], they won't tell their friends it was by Zusha. They'll tell them it was from California Watch, or in the Chron. You don't say, 'I read a story by the AP,' you say, 'I read a story in the Merc.'"

To a newspaper, though, the whole point of having a vessel is to fill it with unique content. Even Proctor, who generally sees the value in nonprofits, admitted that everything on the front page of the Chron is usually staff-generated — an acknowledgement of the perceived importance of the paper providing its readers with stories they can't get anywhere else. A mere glance at the paper's May 10 issue proved as much; all four stories on Page One were written by Chron reporters, including a piece about President Obama declaring his support for gay marriage. If any story could have been easily outsourced (to AP, for example), it was that one. But the Chron editors obviously thought it was important to produce the Obama story in-house — a further admission of the value of brand uniqueness.

Thus, if the Chron were to start filling its front page with stories purchased from CIR, it could wind up on the slippery slope toward brand dissolution: After all, what's the Chron's value if its front page looks more or less like every other paper up and down the state? And why subscribe to the Chron anymore when you can find much of its content in the LA Times, or, better yet, for free at California Watch's website? From there, it's not all that hard to see the endgame: Brand dissolution means readers have less reason to pick up a specific newspaper — and in a news economy in which most papers are still earning the majority of their revenue from print readership, that's the kiss of death.

For an outlet like ProPublica, this is may be less of an issue: That organization typically only gives a story to one paper at a time, and it's largely focused on deep investigative work — work that is, by definition and design, time-consuming and labor-intensive, and which for that reason has by and large already been excised from many newsrooms. ProPublica stories wouldn't show up on front pages across the country, both because of the organization's exclusivity clauses and because of its relatively slow rate of production. And even if they did, it wouldn't have been a choice between a newspaper printing the story and having a member of its investigative team produce it, because there is no investigative team any more.


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