Why news sites keep fail­ing

Los Angeles Times - - OP-ED - By Alan D. Mut­ter Alan D. Mut­ter is a for­mer news­pa­per editor and Sil­i­con Val­ley chief ex­ec­u­tive. In ad­di­tion to teach­ing at UC Berke­ley, he is a strate­gic con­sul­tant to global media com­pa­nies.

Af­ter staff cuts at re­gional news­pa­pers re­duced re­port­ing in David­son County, N. C., vet­eran jour­nal­ist David Boraks in 2009 started an online site to fill the void. Last month, Boraks shut it down, telling his read­ers, “Alas, we haven’t turned it into a sus­tain­able busi­ness.”

The demise of David­sonNews. net is far from unique. One of ev­ery four news start- ups has failed, ac­cord­ing to a sur­vey I con­ducted.

My method­ol­ogy was sim­ple. I looked up all 141 ven­tures listed in the Columbia Jour­nal­ism Re­view’s Guide to Online News Star­tups, which dates back to 2010. Then I counted the num­ber that ei­ther were de­funct or had not pub­lished any new con­tent since 2014.

Be­cause CJR de­pends on en­trepreneurs to list their ef­forts, not all start- ups — or even­tual crack­ups — are in­cluded. But the CJR sam­ple is big and di­verse enough to alarm any­one who cares about the fu­ture of news, and es­pe­cially those who hope that grass- roots dig­i­tal ef­forts even­tu­ally can re­place tra­di­tional lo­cal news- gath­er­ing oper­a­tions.

There is noth­ing less than a cri­sis in lo­cal re­port­ing. News­pa­pers still em­ploy more than half of the 70,000 jour­nal­ists cov­er­ing lo­cal af­fairs in the United States, ac­cord­ing to the Pew Re­search Cen­ter. Yet, since 2000, the na­tion’s news­pa­pers have elim­i­nated one- third of news­room jobs, ac­cord­ing to a sur­vey by the Amer­i­can So­ci­ety of News Ed­i­tors. The cut­backs re­sult from a dra­matic and trau­matic drop in news­pa­per advertising rev­enues, which have plunged by more than half since hit­ting an all- time high of $ 49 bil­lion in 2005.

The ab­sence of lo­cal cov­er­age is ev­i­dent in places like David­son County. “At many town meet­ings, I am the only re­porter ( and some­times the only citizen) in the room,” Boraks said when he launched his site six years ago. Now, it’s un­likely he will regularly at­tend those meet­ings. Who will keep tabs on public of­fi­cials?

David­sonNews. net joins such idled ef­forts as A2 Politico in Ann Ar­bor, Mich., which has not been up­dated since 2013, and Yad­kin Val­ley Sports in North Carolina, whose Web ad­dress leads to a place- holder site with no con­tent what­so­ever.

The toll of the de­parted also in­cludes such high- pro­file, well­funded and ill- man­aged ven­tures as the Chicago News Co­op­er­a­tive and the Bay Citizen in North­ern Cal­i­for­nia. A late- break­ing ad­di­tion is the Bold Italic, a re­cently dis­con­tin­ued ef­fort in San Fran­cisco that had been funded by Gan­nett as a dig­i­tal in­no­va­tion lab­o­ra­tory.

Although my sur­vey did not delve into the cir­cum­stances con­tribut­ing to the demise of each of the var­i­ous news ven­tures, the cause of death in most cases likely was the one cited by Boraks in his farewell mes­sage:

“We’ve been un­able to sell enough advertising to lo­cal busi­nesses to sus­tain the sites, to pay me and, lately, to pay our staff. At the same time, vol­un­tary sup­port from read­ers — which has al­ways been lim­ited — has dropped off.”

Of course, far more new busi­nesses fail than suc­ceed, in­clud­ing start- ups in such cash- rich f ields as tech­nol­ogy. But many news ven­tures are hand­i­capped be­cause they fo­cus less on de­vel­op­ing vi­able busi­ness mod­els than on the cher­ished jour­nal­is­tic mis­sion of aff lict­ing the com­fort­able and com­fort­ing the aff licted.

The Pew Cen­ter found that nearly a third of news start- ups spend less than 10% of their staff time on busi­ness de­vel­op­ment, while more than half say such ac­tiv­i­ties oc­cupy be­tween 10% and 24% of their time. By con­trast, 85% of the ven­tures say ed­i­to­rial tasks con­sume at least half of their time.

Un­less and un­til peo­ple run­ning news sites take the busi­ness of their busi­nesses as se­ri­ously as they take their jour­nal­ism, the fail­ures will con­tinue.

Of course, the fail­ures could con­tinue any­way, be­cause the most in­tractable prob­lem for news ven­tures may be a hope­less re­luc­tance in the mar­ket­place to pay for what jour­nal­ists do.

Although Boraks, for one, clearly was in­tent on build­ing a sus­tain­able busi­ness, he could not gen­er­ate enough sup­port among read­ers and ad­ver­tis­ers. Even ded­i­cated jour­nal­ists can’t af­ford to work for noth­ing. As re­ward­ing as his start- up ex­pe­ri­ence was, Bo­rak signed off his news site by say­ing: “We’re in debt, we’re ex­hausted and it’s time to go.”

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