Laporte said he charges $70 CPMs for ads. Some questioned the $12 CPM we included in our New Business Models for News, though we went with a conservative middle-ground based on the experience of existing local businesses. If we had – as we will – instead forecast a new kind of local news business – highly targeted with a highly engaged public, like TWiT’s – the CPMs and bottom lines would have been exponentially higher. The companies are still small but they are profitable. Laporte said he has costs of $350,000 a year with seven employees now but revenue of $1.5 million and that revenue is doubling annually. It will increase more as he announces new means of distribution (to the TV; he believes that podcasting is too hard for the audience).

Rather than nickel-and-diming current business assumptions, we need to have the ambition of a Laporte and build the new and better media enterprise.

(The video is after this link; it unfortunately plays automatically, so we wanted to get it off the front page).

(Note: Our models were funded by the Knight Foundation.)

Last month, at a conference on non-profit media hosted by Duke University, Joel Kramer of MinnPost.com and Jon Sawyer of the Pulitzer Center, presented an outline for a nationwide “donor collaborative” (download the pdf of their whitepaper). The network would allow these new shoestring news organizations, many of which are filling coverage holes left as metro newspapers cut back, to expand their fundraising efforts.

The collaborative would grant money based on the not-for-profits success at raising revenues through other areas (donations, subscriptions, etc.). Grants would be a percentage of the organization’s previous year’s revenues, with a matching system for donations from individuals.

The network could also be a boon to foundations and philanthropists who want to help new news organizations. With successful for-profit newspapers the norm for the last century or so, philanthropists have been focused on helping the poor, curing disease or funding local arts projects. They are used to (and more comfortable) funding discrete programs–unlike news operations which require continuous funding. They have little experience with which to judge the viability of a news startup. As Kramer and Sawyer write:

It will require substantial effort on their part to make sense of the landscape and decide which enterprises to support. Because of the low barrier to entry, there will be many new startups in this space, and many of them may not have the skill or capacity to diversify their revenue streams, so they will be dependent on their foundation supporters for their survival.

Check out the conference website for all of the non-profit model papers.

This is a fantastic case of young journalists scratching their own itch. The group recently formed their own nonprofit and are discussing what they need to do to get to the next step.

Next step? They are already getting college publications off College Publisher and onto WordPress. They are being the change they want to see in the world. They are already making waves, their next step is simply iteration and scaling.

Meet Greg Linch one of the forces behind CoPress who gives more details.

I went to my first barcamp in October of 2006 and it changed the way I thought about in person collaboration. My friend Noel Hidalgo (who I met at that barcamp) and I eventually talked about an open space for journalism we called CopyCamp. The idea never took off for us, but for Jason it appears to have reached a groundswell. And the timing couldn’t be more right.

For those who aren’t familiar with Barcamps: Think open source conference. The agenda for the day is determined that morning by those who are participating (notice I didn’t say “attending”). This setup may sound chaotic – but using tested methods these “unconferneces” are usually incredibly positive and productive.

The discussion below does assume a bit of knowledge about Barcamps in general. If you aren’t already familiar – check out Barcamp.org co-founded by brillant web-thinker Chris Messina. Better yet – just attend one! This is not a club – anyone can attend, from a young cub-reporter to the CEO of a the NY Times. In a Barcamp setting – both these indvidiuals have something to contribute and gain.

p.s. It’ll be tough – but I may try and sneak up to Portland for the January 24th News Innovation Barcamp. That’s a six-hour drive from SF, but it would be great to meet like-minded folks up north.

Tom – as someone who is an outsider to journalism, what were your thoughts on the day and the situation journalism faces.

Let me start with the day. As a technology person who has been around industries that have changed because of technology and the Internet it was heartening to see newspaper people recognize the magnitude of the change and not justify the head in the sand approach. There was general consensus that this is not an-incremental change and incremental solutions won’t work.

In Telecom and other industries – there is generally denial until the very end. But for most people who attended there was a real awareness that change isn’t necessarily bad. It is disruptive but it can lead to journalist being more effective at their mission, provided they can figure out little details along the way like … how to get paid for it.

The bigger subject is a fascinating one because it probably is true that journalists have never had tools that are as good as the tools that are avaliable now. The ability to selectively crowdsource a story if you need to, or build a story as Jeff described it, even if the story itself isn’t the focal point, where you start something and pieces of it get filled in around it through the link economy, video can be mixed in and the man on the street is everywhere, etc. So the tools for journalists to do their job are fantastic. And the physical impediments are smaller than they have ever been. But the business model hasn’t been figured out – and journalists have to eat like everyone else.

I think we got far enough in the day to figure out that’s where we are – but we didn’t get much further. There are a few possible models for journalist and a few hyper-local models but there is a distance to go in terms of figuring out how they can make a living in journalism. It’s not a question of what value journalism can add – there is general agreement that credibility, editing, facts, and quality reporting are things that journalists bring that is of value- but it is hard to see how revenue can come from it right now.

Are there any direct comparisons or analogies from when you worked in Telecom?

Any industry under threat tries to cut its way to greatness. Particularly industries that have had a controlling situation for a period of time. When indsturies were essentially monopolies or they have a franchise it’s very hard for the owners or stockholders to realize the value is evaporating. Their first reaction is that these are temporary times and cutting back is a solution.

Often this is a good first reaction – because they were monopolies these companies typically have a lot of fat. But there comes a point where you can’t cut anymore. There is nothing left to cut and if you keep cutting the product gets damaged and its a downward spiral. That is Telecom, newspapers, and perhaps the car industry.

What’s different though? Related to this I think is a comment you brought up about the economics of Craigslist. That growth of a network is more valuable than high revenues per network node? So that if you charge as little as possible – but the network grows in size, it becomes impossible for others to compete. Is there a way newspapers could leverage that?

It’s maximizing your network by drawing out as little cash as you can until you are in a sailable position.

I’m just guessing here – this is just speculation because the answer is probably different if you mean local, regional, national or global.

It’s probably easiest to see where local news organizations, hyper-local in web terms, analogous to a small-town newspaper could achieve this status. I think we will fairly quickly find the model and tools wher ethe local site becomes an indispensable part of people’s lives and advertisers are eager to support it – because it has a consistent readership with identifiable demographics.

By making readers contributors (which newspapers have always done to some extent with wedding annoucements, etc), using the ability to crowdosurce when trains are late, where crime is, etc – the local sites like Baristanet can become an even more apart of people’s lives than the small-town newspapers used to be.

At that point in time – they won’t need to charge a lot for advertising because they will have a lot of it – and they will be in the Cragislist spot where they can charge so little it will be tough for competition to sneak in. A rival local newspaper will have real competition. But competition would be good because it would mean together they would figure out the proper economics.

I think there would only be one winner – at least until the winner gets sloppy. Because if one builds a good network in terms of people then there is not much sense in being part of the inferior network. If it’s as simple as traffic reports where you have 1,000 readers sending in updates and you have lots of people texting in so that site has the best traffic reports and somebody else starts up another network their site is going to be useless because nobody is on it – and why would anybody join it? It’s useless.

I’m not sure what this looks like at the regional national or global level. It’s hard to have a community if everybody reads the NY Times – the Times is doing an experiment with TimesPeople – where if you join the community you know what your friends are reading, etc – they are trying to be the host of a lot of little communities -because that is more interesting than worldwide – everyone read this article. So being a larger group that hosts smaller groups with an excellence at national or international coverage. That could work for NY Times WaPo organizations – but not many of those. They could be advertising supported if people integrated it into their daily lives.

I don’t know what happens inbetween at the regional level. I think it’ll be important because from a governance point of view – we need the information.
Last thoughts?

I’m optimistic – I think something will evolve because we have such a need for the information. People are interested – maybe cause there is more information or maybe because they are scared – but a positive thing for journalists is that there is this hunger if there is a business model for supplying it.

If “the value of a network is proportional to the square of the number of endpoints,” then one task as digital journalists is to scale our networks — be they organically-grown, hyperlocal blogs or corporate-driven, international communities — as quickly and effectively as possible.

In a broadly-ranging, nearly consensus-free conversation, the “Networks” break-our group explored one case study, factors necessary to support network growth, and inherent challenges.
Tom Evslin provided two key points for our discussion of Debby Galant’s Baristanet, a blog covering news specific to Montclaire, NJ.

• The best Editorial networks grow organically from the bottom up.  Individual entities tend towards expertise and passion, but lack platform or ad sale expertise.
• The best Tool networks tend to form top down with standardized platform tools and metrics, plus centralized ad ops.

It stands to reason, then, that a top down initiative like Microsoft’s Sidewalk — possessing platform, metrics, and ad ops standardization lacking editorial expertise, flexibility and voice (see “The Cracks In Microsoft’s Sidewalk“) – might fail.

Likewise, though Debby’s Baristanet is a local success, her network value is less than it could be.  Moreover, she is forced to spend resources on platform and ad ops, instead of pure content creation.
Baristanet, then, would benefit from a broader, hyper-local site-supporting platform.

Outside.in’s Mark Josephson and NowPublic’s Merrill Brown contributed valuable insight from a platform perspective on incentivizing network engagement:

• Egos: We’ll make you a star!
• Revenue: My ads on your page.
• Reward/Reputation

In the waning minutes of our conversation, Harvard’s Thomas Eisenmann connected the conversation to a key question as news organizations continue to decline: If a city’s primary paper disappeared, would hyper-local coverage replace the centralized, enterprise-journalism oriented newsroom?
In the end, Thomas’s question lingered alongside a number of others:

• What are the best examples of journalism networks?
• Are journalism networks fundamentally niche?
• Can niche networks serve investigative journalism?
• How does a historically corporate, top-down infrastructure grow a network?

Possibilities for public support of news media are clustering in some key areas – foundation grants, member donations, targeted micro-payments, and government support.

Our group discussed how some forms of public support can threaten a news operation’s independence, either by funding coverage of certain topics to a degree that can skew the overall news agenda, or by subjecting the newsroom to corporate or political influence.

By far, the Holy Grail for public support is to raise an endowment big enough to generate the annual revenue needed to run a news initiative, be it a newsroom or a Pro Publica project.  This liberates news projects from continual fundraising and lets them concentrate on the journalism.
NPR-like drives for donor support have sustained public radio, but can contribute to tensions between the national programmers and local affiliate.

Several experiments are just now underway that involve soliciting micro payments from individuals.  Len Witt’s Representative Journalism project asks people to support a reporter.  David Cohn’s Spot.us project asks people to fund a particular story.  And Harvard’s Berkman Center has developed software, Vendor Relationship Management (VRM), that aims to engage vendors and customers in new ways.
Should government support the news media in a BBC-like model, possibly with an Internet tax?   Such ideas met with cautions of recent influence peddling by executives the Corporation for Public Broadcasting.

Could the cost of producing news content be supported by those who aggregate it, much like the cable companies support CSPAN? Or could major universities like Harvard shelter news projects? Perhaps.
Should philanthropic foundations be catalysts for what news media ought to  do, rather than simply funders of the status quo?

As important is the question of whether news organizations would be more successful attracting public support if they reframed their mission, less as an act of information, and more as an act of community building.

“Can you make the case that you are filing a need?” asked Jay Rosen.

Can you show that news media exist not just to cover community, but to build it as well?

In some developing countries, having a private newspaper is gold.. an implication of real democracy in its government.

But the U.S. is way ahead in the sense that it has experienced its share of having various private newspapers, and now, it’s leading in the reality of the failure of many of those newspapers. Why is this happening? Is it because there’s lack of adequate networking?

No.

Here’s why:

The U.S. is one of the leading countries in terms of exposure to the internet.

“Anywhere the internet use gets over 50% of the population, newspaper is going to fail. The internet has now replaced what we used to have,” said Thomas, Eisenmann, Harvard Business School.

There is a prediction that those developing countries where private newspapers is a big deal will also eventually experience what the U.S. is experiencing as the country gets more exposed to the internet.

“There’s a public exchange of videos among some stations in Europe,” said  Christiana Falcone, Wolrd Economic Forum, an example of journalist drawing closer to having a network for their newsrooms.

Should this be encouraged among journalism organizations in general?

Someone responded that you can’t create it for all of them, such as newspaper organizations because of the way they’re structured.

How would it be like if newsrooms have a network?!?

This question was not really address, but I don’t think most news organizations would want it. They like the competition too much. Everyone wants to be the one to release a breaking news first!

People go to google, if they don’t find it, they go to Yahoo

The key is to make sure you’re meeting the needs of the audience. That’s what these two giants (Google & Yahoo) are doing. Some blog owners have links to other sites, and they direct people to visit those sites for more information/resources. In turn, they don’t loose their audience, which some sites are afraid of. Actually, people do come back to these sites just because they know that the site can lead them to where they’ll find what they’re looking for.