As we all know, the problem of running not-for-profit news outlets is that they have to be funded. If journalists want to eat, then their journalism - no matter how good it might be - is not enough.
Two writers with the US-based Knight Foundation, Mayur Patel and Michele McLellan, argue that non-profit sites "have to act like digital businesses". In other words, they must introduce a measure of entrepreneurship in order to survive.
They have carried out a study, Getting Local, into some of America's leading online local non-profit news ventures to see how they obtain their funding.
Conceding that none has yet to develop "a clear business model", they believe that "some of the key ingredients needed for success are becoming increasingly apparent."
Here's a three-point rundown of those so-called key ingredients:
1. A business development strategy and the capacity to execute it
A news organisation may start with foundation (philanthropic/charitable) support. But, from the outset, it must experiment to discover other sources of revenue.
Foundation funding should be treated as equity rather than as an ongoing revenue stream. Philanthropic support is likely to diminish over time and needs be supplemented with new sources, such as memberships, advertising, sponsorships or events.
Example: MinnPost, a news outlet serving Minnesota, which was launched in 2007 with foundation and donor support.
By last year, it drew more than a third of its $1.28m (£820,000) revenue from non-charitable sources, including corporate sponsorships, advertising and its MinnRoast annual fundraising event.
2. A high level of audience focus and innovative approaches to build community engagement
A team of journalists creating a web newspaper is not a sustainable proposition. In addition to business expertise, such outlets need to understand who they want to reach.
They also need to experiment with ways to engage those communities in order to have an impact on civic life.
Example: The Voice San Diego regularly analyses data on the more than 6,500 subscribers to its morning report – a daily email with article excerpts and links to full content - to gain a deeper understanding of its audience.
Earlier this year, the site launched a major community event - Politifest 2011, which included a mayoral debate and an "idea tournament", much like American Idol, to discover the best ideas among residents for making their region better.
3. Technological capacity to support and track engagement
A higher expectation of interactivity and a goal of strong engagement require technological capacity that sits outside the experience of many journalists.Patel and McLellan conclude: "There are many unknowns in the emerging field of non-profit news organisations. But it is clear that successful ventures will aspire well beyond producing high-quality journalistic content.
Example: The Texas Tribune, has devoted significant resources to technology – developing innovative interactive features and highly searchable public databases, which have become a significant draw to the site and helped drive deeper audience engagement.
The average time people spent on the site in early 2011 was nearly four minutes.
"Entrepreneurial revenue development, audience focus and a mission of engagement, and technology to support that mission, are essential components of a sustainable not-for-profit news venture."
Source: Knight Foundation blog
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