New News Co-ops: Evolution Happens

Once shunned for its suspiciously reddish tinge, the word “cooperative” may have regained utility, and credibility, in the vocabulary of journalism business models.

As the newly formed Chicago News Cooperative appears to demonstrate, it’s not just a way of organizing journalists when the traditional model is failing; it’s also a means for undercapitalized commercial media companies to offload the expense of maintaining their own local/regional newsrooms.

A New Type of News Nonprofit
Though I don’t think we’re quite dealing with a new dawn for anarcho-syndicalist worker’s coops, the emergence of the Pocantico community — a diverse group of investigative-news nonprofits that have banded together to share resources and multiply impacts — has been followed by this more regional, heartlands venture.

The Chicago News Cooperative, as reported by Poynter, will get its startup funding from the MacArthur Foundation, and support from local public radio and TV outlets.

Its first major client will be the New York Times; the CNC will produce two original pages of content for the Gray Lady’s Chicago edition.

It’s telling to note that a major commercial news outlet such as the Times is now embracing nonprofit newsrooms as an affordable source of quality local/regional coverage. A similar effort is emerging in San Francisco, with the Times getting local content from the semi-cooperative (and semi-controversial!) Bay Area News Project.

Emerging Trends
The Times also dipped its toe in the nonprofit waters earlier this year, offloading onto Spot.Us the expense of sending a freelancer reporter to the Pacific Garbage Patch. The breakthrough crowdfunding service (disclaimer: My own Newsdesk.org project is an ongoing Spot.us partner) has raised more than $6,000 for this purpose — though one wonders why a multi-billion-dollar media corporation couldn’t have shelled out the dough itself; are there are some murky lines being crossed?

Regardless, the breakthrough here is the twofold acceleration of new trends in organizational and revenue development:

  • Journalists are self-organizing into cooperative business organizations that are more responsive to their needs than existing commercial and “dinosaur” nonprofit structures. 
  • Commercial news outlets, starved for resources and battered by Wall Street economics, are increasingly turning to lean nonprofit service providers to develop public-interest coverage that is not viable under a for-profit business model. (The Associated Press offers a precedent for this, though that agency itself is a dinosaur, and potentially vulnerable to increasing competition from smaller, emergent nonprofit networks and agencies.)

The “market pain” is clear. Unless there’s some dramatic change in journalism business models nationwide turn for the better for commercial journalism business models, these new trends will come to define news production in the 21st century.

Traditional for-profit news outlets, meanwhile, could largely become hollow brands, mass-market vehicles for lighter content about sports, entertainment, political “chatter” and requisite ambulance chasing, and turning to nonprofit third parties for the serious stuff that doesn’t quite capture eyeballs en masse like Octomom.

Whether this is a final state for 21st century journalism, or just another step in the transformation of the news sector, remains to be seen.

But there will be much, much more of it.

Noted: The Executive Pay Question

From the Columbia Journalism Review, a comment on executive pay and the startup-funding issues that confront small, nonprofit-news projects (such as my own Newsdesk.org endeavor):

Newsosaur Alan Mutter [noted] that Paul Steiger, the editor in chief of the non-profit news startup Pro Publica, earned a $570,00 salary in 2008. Mutter compared that situation to the Chi-Town Daily News, a startup that folded in September after it failed to raise $300,000 needed to meet its annual budget …

“Adding Steiger, a former managing editor at The Wall Street Journal (where he earned more than twice as much), to Pro Publica’s masthead surely provided the start-up some much-needed star power. On the other hand, half his salary would still leave him well off by industry standards, and free up enough money to hire half a dozen reporters. So this raises the question: Can very large news salaries be justified in the current business climate? And does it make a difference whether the outlet is a non-profit startup, a for-profit newspaper, or a television news network?”

Note to Hearst: NY Papers Ready to Pick up Your Bay Area Slack

Having long railed against Bay Area news publishers for essentially ignoring an abundance of important stories and demanding readers in favor of Wine Country ad supplements and lurid screaming headlines, I read with some interest the following item, about the NY Times and Wall Street Journal’s plans for Bay Area editions:

Both The Journal and The Times seem to be betting that the Bay Area is the place to try first. Its biggest newspapers, The San Francisco Chronicle and The San Jose Mercury News, have suffered through some of the sharpest downsizing in the industry, and a very high percentage of the region’s residents moved from elsewhere, which usually means less attachment to the local paper.

I mean, how can a publisher, in a market it essentially owned, let it all slip away?

Maybe by … ignoring the stories that matter, and firing the reporters that do their best work?

The Chronicle fired (er, laid off? bought out?) environment reporter Jane Kay — Jane Kay! — the steroids-in-baseball-busting Lance Williams and superstar foreign correspondent Anna Badkhen

Somehow — how, though, seriously, how? — these five-star newsroom professionals were viewed as liabilities in the Chronicle’s struggle for survival.

And now the news heavyweights are moving in. SFGate.com will do fine as a source for local lifestyle information (movies, restaurants, etc.) plus crime reporting and occasional City Hall columns, but can Hearst compete as a serious local news outlets given the devastation of the SF Chron’s reporting capacity? Let me note the Gate has already begun direct-linking to other outlets’ coverage of important stories they lack the firepower to cover.

And how does the Examiner fit in? Sure, they have a knack for punchy and succinct coverage of local news, but can they even give away wood pulp sporting 50-point morning headlines about major news items people learned about online the night before?

As ye sow, so shall ye reap, or something like that.

Guest Post: “The Argument for Network Neutrality (a.k.a. ‘The Commons’)”

By Jeff Gerhardt, Ronin Geek

[EDITOR’S NOTE: Gerhardt, whose early career found him helping midwife the Internet in its ARPA days, says that attempts to portray Net Neutrality as “socialist” are distortions of history. In fact, he writes: The Internet is by nature and intent open-source, peer-driven, fundamentally entrepreneurial, and thus Net Neutrality is as American as the First Amendment. The real redistribution of wealth, he says, was the giveaway of telecom infrastructure to commercial monopolies, to the detriment of “entrepreneurial America.”]

To those of you who do not want to see the Internet become TV-2, I am once again in the position where I feel I need to remind people of the history of all of this Internet stuff, as a primer to the issue of Network Neutrality and its importance to every American.

I get to do that because I was there at the beginning.

As a college student (early 1970s) I was a grunt pulling infrastructure cable that was used on ARPA network segments. Yup. I knew the ARPA guys. They were my geek gods before I ever saw a personal computer.

I have met and discussed the Net with Vint Cerf, Bob Kahn, Bob Braden, Jon Postel and other members of the Network Working Group headed by Steve Crocker (Mr TCP/IP himself). I still get an excitement each year on the anniversary of RFC-1 day.

Although, unlike some politicians that will go unnamed, I did not invent the Internet — man, did it change the course of my life. I am a rare breed, people like me are honest to goodness Internet Dinosaurs.

A few years later I was working for Compuserve as a SYSOP of a Tandy SIG. A few years after that I opened up a couple BBS systems. A few years after that some fellow BBS operators (and I) got together to split the cost on a UUNET account, so we could do that electronic mail thing. And eventually some of us got together to put together some of the first Internet Service Providers in the world.

So, I was often in the room, when some of the fundamental technology that created the >>commercial phase<< of the Internet WAS INVENTED. The guy in the office next to me invented what I believe was the first multi-domain Web hosting server (yes — virtual domain Web hosting) in the world (with a single IP number).

I was part of a meeting that white-boarded out VDS technology that made regional and national ISPs a viable business model.

My buddy Kevin and I, well if we did not invent something, we were often in the mix of a first practical demonstration of a technologies viability.

I was a part of an alliance of ISPs that were the first to deploy DSL and Internet over cable solutions. And let me tell you, in 1996 we (the U.S.) were leading the world in broadband deployment and innovation and the phone and cable companies had almost nothing to do with it.

That fact was true until September of 1997, when the Cable and Phone Companies STOPPED Broadband Deployment in its tracks by reinterpreting the 1996 Telco Act as giving them power to restrict broadband deployment.

Let me tell you something about all that history.

* * * * *

Never, not once from the ARPA days, through the “BBS & online community” days and up through the ISP era, was the concept of Network Neutrality EVER questioned.

PEERING was at the heart of the Internet model and equality was the bedrock. It was unthinkable to question.

And to boot, it was far from “socialist” as it created the largest economic explosion in the history of the United States. Please — when you see your local representatives, remind them of that.

But what was unique about the Internet as “The Commons,” as my friend Doc Searls liked to call it, was that it was down to its basic elements VERY AMERICAN. It was all about freedom — freedom of speech, freedom of opportunity and a fundamentally fair and level playing field.

So to say that Network Neutrality is “socializing the Internet” is a total fraud. It is in one word (and you can quote me) “CRAP”.

Now, removing Network Neutrality is a form of socialism, that of a corporate/government social symbiosis; or a “Corporatocracy” as the wonks would call it.

Redistribution of wealth as an act of socialism; is not any different if you are taxing the rich to provide service for the poor as it is to take property from the public at large and give it to corporations.

With the passage of the 1996 Telecommunications Act, it was evident that the phone industry was in more trouble then even the smartest economists predicted. The ISP industry was handing the combined telecommunications industry its lunch.

Smaller, more responsive to public demand, LOCAL companies were taking a larger and larger marketshare. And, with the advent of large-scale IP networks, it became apparent to anyone with a brain that phone companies had outlived their useful purpose.

At the start of 1997 it looked like the only thing that would save the phone companies was re-regulation. But the public had been made a promise of cheaper, faster and more diverse telecommunications options; so re-regulation was not an option.

I ask, anyone’s cable or phone bill gone down in the last 12 years?

The response by the telecommunications industry was a period of time when ethics and attention to law simply vanished. The stories of the illegal acts done by the phone industry to try to destroy ISPs are a dark era in the history of corporate America.

Phone companies were being issued the largest fines in the history of corporate America. The response by our federal government, rather then threatening to break them up for being the illegal and unethical monopolies that they were, was to allow the FCC to make an announcement that they would simply stop enforcing the regulatory process.

Doing so allowed the elected officials to wave a magic wand to absolve themselves of any wrong doing and blame it all on the FCC.

This created “open season” on ISPs. Tens of thousands of technology companies closed over the following few years causing a “tech sector” recession in 2002 that has really never ended.

People in government turn a blind eye to this fact, saying “oh we thought it would push deployment of broadband faster to Americans if it was focused on fewer and larger firms.”

Were the illegal activities that cost people billions during those days any less despicable then the actions of Bernard Madoff in more recent times? I think not. The difference was that the phone companies had lobbyists in place pouring funds into both political parties.

As a result, we are now somewhere between 13th and 30th in the industrialized world in broadband deployment, instead of first when this all started.

As a result we have less choices, higher costs, fewer options, less innovation.

Network Neutrality is in fact the opposite of what the astroturf groups claim. It is not socialist, but very very PRO-business. It’s just that it is pro-entrepreneur, pro-small business, pro-equal access, pro-fair play, pro-American Community.

200 years ago, small-business America created something new and special in the world. It was all about empowering people and making resources available to them in a plentiful and low cost was.

Today many (not all but many) corporate interests have grown beyond their loyalty to the nation and hold their primary allegiance to stockholders and boards of directors. That is their choice in a free country. Some would even say it is their obligation as a corporation.

But, as those stockholders are often people and corporations from outside the country, it is ABSURD to grant large corporations some form of special status that is superior to and has more rights than small businesses that are in local communities, creating local jobs, generating local taxes, all across our country.

* * * * *

From the early days of the existence of the Bell Telephone Company, there was an understanding of a concept called “The Public Interest & Trust.” This was the assurance to a phone company that they would be granted a reasonable monopoly to recover their investment for infrastructure placed in the public right of way.

There was a caveat to this that was an implied threat to the corporation: If they did not act in the public interest, the infrastructure laying in the public right-of-way was in fact owned by the public and serviced in trust by the corporation.

So, if that corporation did not act in the public interest, there was an asset they could lose access too.

In my and others’ opinion, part of the reason why the phone industry helped to foster a recession in the Dot Com Bust was to stall all further improvement of network elements until they could be guaranteed ownership (forever) of the infrastructure laid in the public right-of-way.

Shortly after the Dot Com Bust began, the Bush administration handed over ownership rights to all the infrastructure in the public trust, the public right of way, to the telephone industry. THIS WAS A REDISTRIBUTION OF WEALTH CONSERVATIVELY VALUED AT ONE TRILLION DOLLARS.

The public trust had its pocket picked!

Do we have more choice? No!

Do we have lower costs? No!

And we are supposed to be happy about that?

Network Neutrality is but one more target of the telecommunications duopoly. We have been going down a slow path of regulatory changes for the Internet to become not a commons, but a TV-Version 2. A DRM platform for the phone and cable companies.

  • We have gone through UCITA (making some technologies illegal), the extension of copyright and the extension of patent rights; all on one side of the corporate coin to control content itself.
  • We have gone through a 13-year-long systematic breakup of the telecommunications industry, then a deregulation of that industry. Now we are going through a re-consolidation of that industry — but without the original protections in place to prevent abusive monopoly tactics.

    * * * * *

    So now, on the other side of the corporate coin, a handful of people are now in control of content flow.

    We may have 150 cable channels, but if they are all owned by a handful corporation, we are no better then we were 50 years ago. They control the content and to a large degree to conventional content flow.

    And now they want to destroy the Internet because in their world view it is socialist?

    The truth is they want to kill Network Neutrality, because they can not compete in a fair and open marketplace.

    Network Neutrality MAY be the only thing that will stand in the short-term to protect what is left of “the public interest”. It may be the only thing that will create a change in direction back to small-business America getting a fair and level playing field.

    As an open-minded independent, I am ashamed of both Republicans and Democrats for turning their back on entrepreneurial America. I hope they all wake up before it’s too late.

    But it is in your power to do something.

    The tension of the recent “town hall meetings” may not have gone your way. But what it has done is shown how motivated people can impact the process.

    So go to SavetheInternet.com and sign the damn petition. Then call your Congressperson before they leave town, and give them a piece of your mind.

    Jeff Gerhardt is an American teacher, inventor, and entrepreneur. His work includes the development of a CAD system, one of the first PC-based point-of-purchase systems, the Tandy Color Computer, and the award-winning “KidCam” Internet Video Security System.

  • Newsdesk.org Receives Major Grant

    [Download a PDF of this press release]

    Newsdesk.org, a program of Independent Arts & Media, has been selected by the Ethics & Excellence in Journalism Foundation to receive a $25,000 grant in support of the nonprofit, public-interest news service News You Might Have Missed (NYMHM).

    The Foundation’s generous gift will be used to develop NYMHM as a daily service that can earn income through syndication; this will support the production and promotion of important but overlooked news, and help improve coverage of underserved communities.

    A Vision for New Public Media
    Syndication is at the heart of the LOCAL.NEWSDESK.ORG proposal to create new public-media infrastructure for local/regional journalism, at a time of crisis for the news industry.

    Local.Newsdesk.Org is a 2009 finalist in the WeMedia/Changemakers “Pitch-It” contest. It envisions a network of independent but affiliated online news bureaus that put professional journalists to work, and connect them more effectively to their communities. The bureau network will function in some ways like a wire service, yet will also report and publish news at the community level, and add resources to the work of local and regional journalism partners.

    Prototype: News You Might Have Missed
    NYMHM has been published Wednesdays since February 2002, and examines national and global issues through the local and regional lens. Its rigorous, hard-news format drives an average of 25,000 unique visitors monthly to Newsdesk.org, on the strength of only one home-page update weekly.

    With support from the Ethics & Excellence in Journalism Foundation, Newsdesk.org will recruit and hire a full-time Staff Editor to turn NYMHM into a daily service — the first step in developing revenue through syndication, in support of the Local.Newsdesk.Org vision.

    Financial oversight is provided by Independent Arts & Media, a 501(c)(3) fiscal sponsor and “shared back office” for commercial-free media/culture programs and producers. Indy Arts services include operations and bookkeeping, promotions, networking events, and support with grant seeking, fundraising and strategic planning.

    Contacts & Further Details:

    Noted: “A Presidential Commission Won’t Save Newspapers”

    Washington Post columnist Howard Kurtz has an interesting item in the paper’s Aug. 17 edition (“The Press Loves a Hero, but … a Presidential Commission Won’t Save Newspapers”), in which he critiques Dan Rather’s call for Mr. Obama to do an inquiry on the travails of news media.

    There are some smart things in there. He notes the emerging news dynamic of “walled garden vs. information-wants-to-be-free,” and the roles and possibilities of nonprofits vs. for-profits.

    His doubts about the value of a presidential commission run contrary to my own sense that more dialogue on complicated issues can’t be a bad thing — as long as that dialogue is constructive and not oppressively prescriptive/didactic.

    In particular, the issue of PUBLIC MEDIA and its neglect is largely overlooked by Kurtz in his critique. It is true that, despite the success of All Things Considered, public media in the United States has largely failed to serve the bulk of the public. That is a topic worthy of deep and responsive discourse.

    More important, though, is his assertion that this is a technology problem, which I disagree with wholeheartedly:

    Journalists got themselves into this mess by clinging to the past as technology threatened to pass them by. They’ll have to get themselves out of it without any assistance from the Oval Office.

    It’s true that journalists got themselves into this mess.

    But it’s not about technology. News media was not hunky dory before the Internet came along and ruined their ad model. The declines in readership date back to the ’60s, and are linked with broadcast and cable TV, as well as generational shifts in civic behavior.

    Deeper still is commercial news media’s crisis of relevance.

    Major newspapers have fewer subscribers because they’re not relevant. Their coverage simply and categorically does not include a wide variety of issues around money, labor, public health and more, and instead “upmarkets” relentlessly to build advertising appeal with coverage of “boom times” and “Gilded Age” topics such as personal finance, expensive restaurants, luxury cars, etc.

    Tom Stites’ speech at the Media Giraffe Conference in Amherst in 2006 — “Is Media Performance Democracy’s Critical Issue?” — is required reading on this topic.

    His thesis of “discarded readers” should be the real clarion call driving the “Save Newspapers” debate.

    Social Entrepreneurship: A False Promise?

    Here’s an interesting parallel to the struggle to advance a new journalism practice: Energy research.

    The status quo of both energy and journalism are recognized worldwide as desperately in need of innovation. Much, in both fields, is said of the power of the entrepreneur in advancing that innovation. Yet support for such innovation remains, it must be said, depressingly out of step with the rhetoric.

    Social entrepreneurship is not something that a roll-up-your-sleeves/DIY type can simply set out and undertake, especially at the delicate R&D stage, where a little bit of cash can go a long way.

    Lacking personal resources, but rich in ideas, the entrepreneur will, most of the time, get no support from the very establishment that lionizes her or his presumptive role as an innovator.

    Today, social entrepreneurship is something that is selectively annointed and supported by status-quo organizations that by definition — by the very fact of their large-scale leadership roles — are unable to apprehend what is truly innovative.

    To innovate, one must be able to break from the status quo — its assumptions, its dogma, its rituals and cultural/social expectations. How, then, can an interest vested in that status quo let go of it in order to support innovation?

    Here’s an excerpt from a New York Times blog entry on how that plays out in the energy-research field:

    … [T]he Department of Energy had to send out letters last week discouraging all but a handful of the 3,500 research teams and individuals seeking some of the $150 million available this year for pursuit of “ transformational” energy technologies.

    One such rejection letter is posted above ( a pdf of the letter is here). The name of the rejected scientist is obscured. He sent it to me, he said, not because he was angry about being denied a shot at funding, but because the letter notes that “less than 2 percent” of such proposals are seen as likely to get support. It’s still early days, of course. But does this look like an energy quest to you?

    Noted: “Do CEOs Matter”?

    The Atlantic delivers a fascinating item in its June 2009 issue on the Great Man Theory of History and how it plays out in the halls of corporate power.

    “Do CEOs Matter?” takes a look at the roller-coaster ride Apple’s stock takes every time a rumor surfaces about the health of Steve Jobs. It explores the difference between a “Titular Figurehead” and an “Unconstrained Manager,” and the relative impact of an executive who stays in the background and holds everything together, vs. the radical aggressor who embraces a corporate culture of high-stakes/high-finance power plays.

    It’s an important article for its unsentimental look at the idea of the CEO as a near-mythic, miracle-working personage who, when the rubber hits the road, can turn out to be singularly destructive forces — for example, Jeffrey Skilling of Enron, or Dennis Kozlowski of Tyco International … or the succession of high rollers who transformed Beatrice Foods from a carefully constructed conglomerate of “mom ‘n’ pop” businessess into a hyper-leveraged Wall Street property that eventually collapsed, and was carved up and sold off in parts, with the carcass absorbed by ConAgra.

    I think about this. And I think of the plight of the media corporations today, and the Atlantic article’s closing statement is all to apropos:

    Maybe that’s the ultimate lesson here: CEOs can matter, but we all might be better off if they didn’t. “Good leaders can make a small positive difference; bad leaders can make a huge negative difference,” Stanford’s Jeffrey Pfeffer told Fortune in 2006. Many Americans, surveying the aftermath of eight years with an Unconstrained Manager as their chief executive, might be tempted to agree.

    It is altogether true that a good leader at the right moment can be transformative for an endeavor. My experience with this is almost entirely in the nonprofit and social-venture sector, where paychecks are absent but heart, soul and passion are abundant — as are the train wrecks.

    The best leaders in such situations almost always submerge their own ego, swallow their pride, and try to bring out the best in the community of people who make a given venture happen. Yes, one must be a “decider,” and not only is consensus building sometimes hellishly difficult, it also can be, in the case of negative-groupthink situations (i.e.: lemmings), a bad idea.

    People need heroes, leadership can make a difference, and yet also, people need to know how to be their OWN heroes, their OWN leaders.

    What lesson is here for the hierarchical newsroom, the executive-driven news corporation, where social capital lies fallow as the drive for sky-high profit margins amid shifting commercial economies brings newspapers to collapse and ruin?

    The Future is NOW: The Networked News Nonprofit

    Journalism’s true strength in the Internet era is decentralized. It’s all about reporters — and reporting teams — working solo, but linking up in parallel to coordinate on stories, cross-promote, and share resources.

    Parallel processing! Peer-to-peer networks. A network model harnesses the inherent strength of the Web as a medium, by providing a shared back office and standards of affiliation. This is the thesis behind Independent Arts & Media and Newsdesk.org.

    Now, on a significantly larger scale, a collaborative of nonprofit news agencies is teaming up to create a new entity, the Investigative News Network, to take up their collective burden of business operations, fund development, and marketing/promotions.

    Driving this is the proliferation of small to mid-sized nonprofit news bureaus around the United States. They’re cropping up in big cities and small towns. They’re tackling diverse issues and beats at the local, regional and national level. They have a variety of business models, publishing methods and partnership policies.

    A glorious ferment! But resources are sorely lacking. Individually, these projects don’t have the financial and promotional clout to routinely achieve the impacts that a commercial media corporation can muster — even in today’s bruised and contused news economy.

    Working in concert, it’s a different story. Resources are multiplied, as the diverse talents and resources of each node in the network are brought to bear on common issues.

    Chief among those issues are the enormous challenges of social entrepreneurship in news media. Remember, the Corporation for Public Broadcasting’s Congressional charter is limited to broadcast. It’s the extremely low cost of publishing on the Web, rather than an abundance of charitable funding, that is driving the boom of professional, nonprofit journalism online.

    Among these nonprofit bureaus, a sense of shared mission and challenge has at last caused some convergence on a larger scale. Yesterday, at the Rockefeller Fund’s Pocantico Conference Center in New York State, the attendees of the Building an Investigative News Network conference produced what I must say is rather thrilling document.

    The future is NOW!

    “The Pocantico Declaration: Creating a Nonprofit Investigative News Network”
    July 1, 2009, Pocantico Conference Center, NY

    “Resolved, that we, representatives of nonprofit news organizations, gather at a time when investigative reporting, so crucial to a functioning democracy, is under threat. There is an urgent need to nourish and sustain the emerging investigative journalism ecosystem to better serve the public.

    “Recognizing, that there are many forms of potential collaboration …. “

    Astonishment: The Tehran Rooftop

    The ongoing flow citizen media coming out of Iran amidst the turmoil has staggered me. I am astonished and weeping at the incredible bravery that is being revealed, at the greed and cruelty of the state, at the power of media as an expression of will and desire.

    Here is a video that overpowers me. The shouts and cries rising like waves far into the night, the narrator’s tiny, quavering voice … she is anonymous, but she contains all the hope for liberation, and all the sorrow for its betrayal, that any human has ever known.