Another Idea for Local News

Martin Langveld comments on the pipe dream which is Peter Kafka’s and Mark Josephson’s model for an online only news site and which–by some revelatory act of Providence–draws 133m page view per month (40m to its original “journalism.”) This, even though they intend to write “only about the really big stories.”   Good luck with that, fellas.    You might want to consider getting out of the news business because if you can bottle that stuff you’re sniffing, you’ll be gazillionaires.

I am reminded that the pastor in the church where I grew up used to say that “when you mix politics and business, you get business.”  The exact same could be said of serious journalism and business, except in the case  of the Kafka/Josephson model judged down for reality, you really get….neither.  There’s no public service mission to speak of, and as a business, it might break even but not a lot more.  True, you don’t invest a lot of capital, so maybe a decent lifestyle business.  But…not worth all the ink, er, pixels being spilled on it as a savior of commercially driven local news.

I’m more and more reminded of Jane Jacobs’s thought-provoking but tough-to-read book, Systems of SurvivalIn it, she argues for the necessity of two, coexisting but distinct ethics systems:   that of the trader, and that of the guardian.  Mix the two of them up, and you get what she calls a “monstrous hybrid.”   The entity described by Kafka and Josephson is certainly a hybrid.  But it’s not even all that monstrous.   It’s just likely not, to mix metaphors,  a game that’s worth the candle.  Pathetic is the word that comes more readily to mind.  I don’t intend to be mean here.  It’s just that we have all these brilliant minds working in an insoluble problem:  local news is just not a business to which significant risk capital  should flow.  Period. 

Now here’s a model I could see.  Assume I own Austin.com.  Why wouldn’t I hire no reporters and isntead ink the following revenue-sharing partnerships:  Mojopages.com (an AV company) for local search and directory; Zillo for real estate; Cars.com for Auto; Monster and Indeed for jobs;traffic.com and weather.com for, well, traffic and weather;  and Outside.in for aggregation

How many employees would I need?  Five?  Three?

Then, I become the lead investor  in a  public news cooperative that is a 501c3 and funded by people and corporate sponsors who really value local news not only because the yuse it, but because they think it is a public good and they’re willing to fund its use by other people who can’t or won’t pay.  This is not so radical:  it’s just an enterprise funded by the people who use news rather than the by advertisers. 

 KUT, the Austin NPR station (which is admittedly exceptionally well run), has a $6mm budget half from individuals.  What if the community decided that a like-size organizaiton was needed to focus on local news?  It would be only about 40% of the cost of the Statesman newsroom, but it’s pretty easy to go through the Statesman and pick out the 40% of the content that’s critical to civic life (Omar Gallaga’s recent front-page analysis of other people’s analysis of TMZ’s analysis of Michael Jackson’s death might not make the cut, for instance).

This, too, is a hybrid approach, but without the monstrosity.  Traders are traders, and guardians remain guardians.  Overall, is the community any worse off?  They’re certainly not confused.  And even if you cut the Kafka Josephson numbers with a hatchet, my family and I have a pretty nice little business.

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3 Responses to Another Idea for Local News

  1. Hi John,

    There are a few things that I think have been misunderstood about the model we posted.

    First, it’s a model full of assumptions. The assumptions are designed to be adjusted. In no way where we saying that this set of assumptions was the ONLY way it would be in EVERY market.

    Clearly most markets will be smaller and the headcount and supporting expenses will drop accordingly.

    Second, we started with data from one market (seattle) that has been very public with their data. They do have 40mm pvs per month and there is a very long tail of great hyperlocal sites in Seattle.

    Third, while we certainly see data from our own numbers and from our partners, we’re long on the vision for how and when this will happen. Will it happen overnight? No, but we are absolutely convinced things are heading in this direction. And we’re doing our best to try and facilitate it.

    Lastly, we created this version of the model to estimate how traditional media businesses may move from big to small, from print to online and from “we must create all our own content” to “we embrace aggregation.”

    Your point about how many people do you really need is well taken. We have built OIP anticipating (and seeing in the first week anyways) that there will be at least as many plucky start-ups and bloggers themselves take advantage of the opportunity as traditional newspapers.

    The cost of entry into the local market just got much much much cheaper and we’re excited to see what will be built off the new platforms being created.

    — Mark

    • johndthornton says:

      First of all, let me say that little bit I’ve played with OIN has left me nothing but impressed. Congrats and continued good luck.

      As for your comments, sll good, and all fair. But if you’re not suggesting making decisons from a model, what good is building it?

      I’m still willing to bet that the news for local information (listings, etc) will end up being a very bare bones affair, only incidentally connected to the market for local journalism, which will be the province of monthlies and bi-weeklies off-line and public media online.

  2. Thanks John.

    We built the model because it needed to be done. 😉 Everyone has been talking in hypotheticals and we wanted to show one scenario (that could be adjusted to fit individual assumptions) that we think could work.

    We agree, btw, that news and listings are separate. Will be interesting to see how it all plays out.

    Love to walk you through where we are heading if you’re interested.

    – Mark

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