No magic bullets – so try a hail of them

12 May

I’ve been preparing a presentation to the terrific News Entrepreneur Boot Camp at the Knight Digital Media Center next week. I’m part of a panel of folks who have transitioned from the newsroom to business-side roles.

As part of the prep work, I’ve re-read a hefty stack of posts about emerging revenue models for news – advertising-supported for-profits, L3Cs, non-profit structures, even the wishful-thinking paid-content model.

Running through many of the pieces was an irksome thread: A focus on single solutions. Most framed the discussion in terms of “what’s the source of revenue,” as if there were a magic bullet that can solve every operation’s money woes.

There isn’t, of course. What’s more important, though, is there never has been. In times like these, naiveté isn’t charming – and for entrepreneurial journalists, it can be downright dangerous.

No successful news media organization has ever relied solely on a single source of revenue. In fact, the most successful industry segments – newspapers, magazines and broadcast stations – have long had many revenue sources, almost too many to list.

There’s more elaboration – and a rough list of the different sources — in this deck.

Key takeaways:

–  Don’t think too broadly. Even something as seemingly straightforward as “advertising” isn’t a single source of revenue. There are myriad advertising products – each with distinct strengths and weaknesses, sets of customers and sales models.

– As you plan the revenue models for your own proto-business (that’s what start-up journalism sites are, folks), copy the best of traditional organizations. Find multiple streams of revenue.

(Lest this come off as too scolding: I think it’s fantastic to see journalists actually interested in this sort of question. For decades, most of us acted as if the money that powered our organizations was created by magic. Worse, some assumed that it was the result of their brilliant journalism. For a welcome example of incisive, if tardy, analysis, see James Fallows’ terrific Atlantic piece on Google and the news industry.)

2 Responses to “No magic bullets – so try a hail of them”

  1. Tim Windsor May 12, 2010 at 12:56 pm #

    As if news startups needed more reasons to build their businesses on smart mobile strategies first, don’t forget about in-app advertising, led by Apple’s iAd system, but sure to be copied.

  2. Bill Day May 13, 2010 at 7:20 am #

    @ Tim: Not to mention that the marketing side model is changing as fast (if not faster) than the ad model

    committing yourself to one revenue stream only guarantees that you’ll wake up one day and wonder where all the money went

    Here’s the piece missing from the conversation – who’s finding the money (grants, ad sales, sub sales, whatever) and how are they doing it? We’ve got a lot of smart people working on the reinvention of journalism – seems to me we’re overdue for the same kind of revolution from the business side.

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