Are cooperatively owned news projects an idea whose time has finally come?

Kevon Paynter. Photo via Bloc by Block News.

Among the more intriguing business models for news organizations is the co-op. They’ve been slow to get started, but their time may finally be coming. For years I followed the Banyan Project’s efforts to launch a demonstration site in Haverhill, Massachusetts, which ended up falling short. The Mendocino Voice is transitioning from for-profit to a co-op that will be owned by employees and readers. And the Voice is not alone.

Last week I sat in on a webinar called “Cooperatives in a Changing Media Landscape,” part of the Next Gen Entrepreneurship online conference. Two people immersed in co-ops discussed their experience: Kevon Paynter, co-founder and executive director of a project called Bloc by Block News, which reports on news in Maryland and aggregates the work of other publishers; and Jasper Wang, the co-owner and vice president of revenue and operations at The Defector, a mostly sports site founded by former employees of Deadspin, which in its heyday was part of the Gawker network. The moderator was Olivia Henry, a graduate student at the University of California in Davis.

The two projects are very different. The Defector was born big, launching last year with 19 employees — 18 of them editors and writers — and 10,000 subscribers. It currently has 39,000 subscribers. According to Wang, everyone is being paid a salary. The lowest is $58,500, with the possibility of making more depending on how much revenue the site is generating. (It’s more complicated than that, but never mind.)

Jasper Wang. Photo via McSweeney’s.

“We’ve been financially sustainable since pretty early on,” Wang said. The site is owned by the employees, he added, with everyone participating in the governance of the site.

For those of us who are concerned about the local news crisis, Bloc by Block is intriguing. Paynter said the spark for it came during the 2016 election. When he went home to New Jersey to vote, he said, he knew who he would cast his presidential ballot for — but he didn’t have a clue about many of the other offices that were also being contested.

“I had no idea who to vote for when it came down to the local issues,” he said. He added that when he started talking with people after the election, many told him they simply vote for one party, Google the candidates or “we kind of make a guess the night before.”

Bloc by Block is supported by nonprofit foundation money, including Maryland Humanities; Paynter sees covering the arts and culture as part of his local news mission. The project is developing a mobile app that will allow users to see news from multiple publishers. Noting that there are more than 130 newspapers in Maryland, Paynter said, “There’s a discoverability issue, and we want to solve for that.”

Unlike The Defector, Bloc by Block is what Paynter calls a “multi-stakeholder cooperative,” with ownership shared among readers and the publishers whose news is being aggregated. Readers themselves can cover local governmental and neighborhood meetings, he added.

“It’s really about civic engagement as well as news,” he said, explaining that he wants his audience to “not simply be passive consumers of information but active participants.”

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Bringing a new Light to the undercovered community of New Bedford

Palmer’s Island Lighthouse in New Bedford Harbor. Photo (cc) 2010 by the Massachusetts Office of Travel and Tourism.

The New Bedford Light, a nonprofit news project launched recently, could lay claim to being the most highly touted community journalism organization in quite some time. Today, The New York Times weighs in. Previously, The Boston Globe and CommonWealth Magazine ran profiles.

As the Times’ Katharine Q. Seelye notes, the Light’s model is to run one significant story a day in the hopes of filling the gap created by the implosion of The Standard-Times, a venerable New Bedford daily that has been ripped apart under the ownership of the Gannett chain.

“We cannot go down the route of the daily newspaper that tries to do all things for all people,” the editor, Barbara Roessner, told Seelye. “The challenge for us is to stay disciplined to do the deeper work and not be caught up in the daily news cycle.”

I’m not so sure about that. As I’ve written previously, what the city might need more than anything is daily accountability journalism. It can be done effectively with a small staff, as the New Haven Independent, to name one example, has been demonstrating for nearly 16 years.

Still, the Light is attractive and has published some significant stories since its debut. Leading the site right now is a story by Will Sennott on the city’s looming eviction crisis. Other recent stories include a look at the effects of rising real-estate prices and racial and ethnic patterns of where COVID-19 hit the New Bedford area the hardest.

The leadership of the Light is unusually high-powered. Roessner is a former managing editor of the Hartford Courant and former executive editor of the Hearst Connecticut Media Group. The publisher is Stephen Taylor, a former top executive of The Boston Globe as well as a member of the family that used to own the Globe. Walter Robinson of “Spotlight” fame is a board member.

It looks like the Light should go a long way toward changing New Bedford’s status as an undercovered community.

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Talking about the local news crisis with Frank News

I spoke with a news organization called Frank News about the local news crisis, the role of corporate chains and hedge funds in making a bad situation worse, and what steps might be taken to improve the situation. Please have a look.

Bipartisan federal legislation would provide tax credits to ease the local news crisis

Bipartisan legislation has been introduced in Congress that would provide some government support for local news. The ubiquitous Steve Waldman, the co-founder of Report for America and the chair of the Rebuild Local News Coalition, writes that the bill “would provide more help for local news than any time in about a century, yet it’s done in a very First-Amendment-friendly way.”

Waldman has the details, so I’ll just hit the highlights:

  • It would provide a tax credit of up to $250 each year for subscriptions or donations to local news — a measure Waldman has been talking about for quite a while.
  • Payroll tax credits would be available to publishers for hiring or retaining journalists.
  • Small businesses would receive a tax credit for advertising in local news outlets.

The bill, known as the Local Journalism Sustainability Act, is co-sponsored by Reps. Dan Newhouse, R-Wash., and Ann Kirkpatrick, D-Ariz.

My reservation about this legislation is that would benefit chain-owned papers as much as it would independent papers and websites. I guess that’s OK, and it’s hard to imagine how to cut out the corporations while keeping benefits for independents. But I’m concerned that the legislation might freeze in place the advantage already held by corporate-owned legacy outlets without providing them much in the way of an incentive to improve their journalism.

On the other hand, I agree with Waldman that the legislation is ingenious in the way that it would provide government support for local news without making news organizations dependent on currying favor with the very people they’re covering. Another smart move: benefits would be limited to organizations with fewer than 750 employees, which would leave out the large national newspapers.

Overall, it’s a pretty interesting step that might help ease the local news crisis. I don’t see this as a comprehensive solution, but even a boost on the margins would help.

Can community journalism be saved?

Ellen Clegg and I talked with Hillary Chabot of News at Northeastern about our book project, tentatively titled “What Works: The Future of Local News.”

How a group of Denver area newspapers were saved from corporate ownership

Photo (cc) 2008 by Alyson Hurt

Just before Thanksgiving last year, Melissa Milios Davis was contacted by Jerry Healey, the co-owner — along with his wife, Ann Healey — of Colorado Community Media, which publishes 24 weekly and monthly newspapers in the Denver suburbs.

The Healeys were approaching retirement and looking to sell, and they were hoping to avoid turning over their life’s work to a corporate chain owner or a hedge fund. Milios Davis, vice president for strategic communications and informed communities at the Gates Family Foundation, serves on the executive committee of the Colorado Media Project, which has been seeking ways forward for local news since 2018.

That encounter, Milios Davis said at a recent webinar (you can watch it here; background information here), led to the sale last month of the Healeys’ newspapers to a new entity whose majority owner will be The Colorado Sun, a startup digital news operation that’s run as a public benefit corporation. That means the 24 papers, like the Sun, will not be organized to enrich its owners; any profits they earn will be rolled back into news coverage and other operations.

“These are still profit-making enterprises. It’s a business,” said Milios Davis, adding it would have been a “huge loss” if the papers had fallen into the wrong hands.

Also speaking at the webinar, organized by the Media Enterprise Design Lab at the University of Colorado Boulder, were Lillian Ruiz, co-founder and managing director of the National Trust for Local News, and Larry Ryckman, editor and co-founder of the Sun. The moderator was Nathan Schneider, an assistant professor of media studies at the university.

According a recent article about the deal by Corey Hutchins of Colorado College, the papers will be owned by the newly formed Colorado News Conservancy, which in turn is co-owned by the National Trust for Local News and the Sun. Hutchins reported that the 40 employees who worked for the Healeys, about half of them journalists, would keep their jobs.

The conservancy is currently seeking a publisher, Ruiz said at the webinar, and has invested a considerable amount of attention in the process. “We didn’t want to create just a replication of who have we had some handshakes with over a highball,” she said.

The Sun itself, which was founded after the meltdown of The Denver Post under the ownership of the hedge fund Alden Global Capital, is continuing to grow, said Ryckman — from a staff of about 10 when I wrote about the Sun for the Nieman Journalism Lab last fall to 15 today, with more on the way. He described the chance to save the community newspapers as something that was too important to pass up.

“At least on the Sun side, this came together pretty quickly,” he said. “This absolutely was a cause that was near and dear to our hearts…. We know who’s first in line when it comes to buying newspapers these days, and no one wants to see that happen.”

What helped jump-start the deal, said Milios Davis, was a study that the Colorado Media Project conducted several years ago in partnership with the Colorado Press Association. Among the findings: the number of journalists covering local news had been cut in half over the previous decade, in line with what was taking place nationally; and that of 151 newspapers they could identify, 93 were still locally owned.

“We saw on the horizon that a lot of these were … older owners” who lacked a succession plan, she said, explaining that there were 44 in that category. “We were looking at this as a tidal wave that would slowly crash on the shores,” which led to conversations about how to help them transition to new local ownership.

And then the Healeys came along.

One of the most important takeaways from what is happening in Colorado is that local news can still be run on a sustainable basis, and that corporate control and the gutting of newsrooms are not inevitable. As I wrote a few weeks ago, I would love to see the Colorado story replicated across the country. Ruiz said the exact model being used in Colorado might be unique to that area. But she added that her organization is looking at what might work in other parts of the country — especially in communities of color.

So how do we wrest control of local news away from chain owners? Report for America co-founder Steven Waldman, who’s been everywhere lately (it also turns out that he’s a co-founder of Ruiz’s organization), wrote an op-ed piece for the Los Angeles Times calling for tax breaks for newspaper owners who sell to nonprofits or public benefit corporations.

That would provide an incentive for the likes of Alden and Gannett to take their money and go home. I would add another incentive: tax penalties to be imposed on for-profit owners of newspaper chains of a certain size that are not owned locally.

Communities deserve a chance to take charge of their news and information. Three years after Alden all but destroyed The Denver Post, we’re starting to see a renaissance fueled by a new media venture and an old one that’s been given new life.

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Local news as infrastructure

Report for America co-founder Steve Waldman is suggesting that a plan he’s been touting to help the beleaguered local news business be included in whatever infrastructure bill comes out of Congress.

Writing recently for Poynter Online, Waldman said that each American should be given a $250 tax credit either to buy a subscription to a local news source or to make a donation to a nonprofit news organization. He notes that Sen. Maria Cantwell, the chair of the Senate Commerce Committee, has come out in favor of $2.4 billion to bolster local news. Waldman writes:

Local news is, in fact, the civic infrastructure of democracy.

But let’s get less metaphorical. If the health of democracy wasn’t reason enough, there’s another, practical reason why help for local news should be part of the infrastructure bill. If the government is going to spend a trillion or so dollars on public works projects, we need local watchdog reporters to make sure the money is spent well.

Waldman has been promoting the $250 tax credit for some time, and he says it has some bipartisan support. But the idea of rolling it into the infrastructure bill seems worth exploring as a way of actually making it a reality.

Waldman discussed his Poynter piece with Brian Stelter last weekend on CNN’s “Reliable Sources.” He’s also involved in an organization called the Rebuild Local News Coalition, comprising more than 4,000 local newsrooms (up from about 3,000 at the time of the Poynter piece) and journalism advocacy organizations.

The Washington Post blows the whistle on a dubious investigative website

The Washington Post published a story of paramount importance last Friday. According to reporter Elahe Izadi, a website called the Checks and Balances Project is offering the sort of deep investigative reporting that most local news outlets no longer have the resources to carry out.

But there is a huge catch. There have been some prominent instances of pay-to-play, with organzations making donations that are followed by stories that will either make them look good or their enemies or competitors look bad. Izadi writes:

When it investigated the hotel industry, it was after it had received a grant from Airbnb. A high-profile investigation into Arizona utility regulators came after Checks and Balances received money from a solar power company, the company disclosed in 2015.

Now Checks and Balances is investigating a massive hospital system in Virginia named Sentara, publishing regular stories and asking patients and employees to send tips that might reveal how the nonprofit hospital “piled up $6 billion in liquid assets,” among other issues.

These stories started appearing the same month that a medical school in a complex dispute with Sentara hired a public relations firm that happens to share a founder and financial ties with Checks and Balances.

Communities are vulnerable to a site like Checks and Balances, of course, because of the demise of local news over the past generation. If your local newspaper shut down or has been so decimated that it can’t offer more than cursory news coverage, then you’re going to be vulnerable to arrangements like this.

The Checks and Balances website touts itself as an “Investigative Watchdog Blog
Holding Government Officials, Lobbyists and Corporate Management Accountable to the Public.” Izadi is careful to point out that the project has done good work over the years, some of which has been picked up by larger media outlets. Its editor was formerly employed by USA Today. Scott Peterson, the executive director, told the Post that funders do not influence the site’s journalism — but Izadi writes that those sources are not always disclosed to readers, either. Moreover, most of its funding comes from an organization called Renew American Prosperity, which does not reveal its donors. From the organization’s website:

We encourage you to be public about your identity as a donor. We’re proud to have the support of such notable funders as philanthropist Lucy Rockefeller Waletzky, legendary entrepreneur Brad Mattson of Siva Power, Silicon Valley attorney Mike Danaher, and communicator extraordinaire Matthew Lewis.

Should you want to keep your support for Renew American Prosperity private, as do others, we also welcome your donations. Private donor support will remain strictly private, out of respect for 501(c)4 tax law that allows donors who wish to be private to remain so. We will never sell or make available to other organizations our supporter lists.

Peterson pushed back on the notion that Checks and Balances isn’t transparent, arguing that what he’s doing is no different from what mainstream outlets do when they accept advertising or, in the case of nonprofits, grants and donations. And of course these things have to be seen on a continuum. When news executives decline to report an important story because they don’t want to offend an advertiser, that’s a scandal — if the public ever learns about it. Ethical nonprofit news outlets are scrupulous about disclosing the sources of their funding, and in making it clear to funders that they will have no influence over coverage. Checks and Balances, at least as described by the Post, appears to go beyond that.

The Post’s story comes at a time when we’re also dealing with the scourge of “pink slime” journalism — community websites set up in areas that are unserved or underserved by local news outlets and that are actually controlled by partisan political interests. As I wrote last fall, most of these sites are Republican, but some are Democratic as well. What they’re not is independent, which is a key part of ethical journalism.

Coming up with funding for investigative projects, especially at the local and regional level, is incredibly difficult, and the Checks and Balances folks may have believed they could cut ethical corners without it harming the integrity of their work. But it looks like dangerous business to me, and I hope it’s not the start of a trend.

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A Northeastern study shows how animation can enhance local TV news

My Northeastern colleagues Mike Beaudet and John Wihbey, along with some amazing students, have been studying ways to improve local television news. Their latest installment looks at how animation can increase viewer interest, attract younger viewers and make it easier to understand the essential facts of a story.

According to a summary of their findings that they wrote along with graduate student Anna Campbell for RTNDA.org:

After viewing the local news stories that took a fresh approach to animation and graphics, viewers preferred that style across the board, with audiences more likely to rate the animated stories as clear, compelling, and memorable. The graphically-enhanced stories were generally perceived both as more relevant in content and resonant in tone. Animation also captured positive descriptions in the open-ended questions we posed.

As you’ll see if you watch the video presentation above, animation essentially takes the place of irrelevant and boring B-roll. And when Beaudet, Campbell and Wihbey refer to animation, they don’t mean something you might see on “Adult Swim.” Rather, they’re talking about presenting visualizations that help viewers understand what they’re watching.

Media observers like me don’t always pay much attention to local TV news. But it’s incredibly important — it’s the second-most popular news medium that we have (the internet comes in first), and it’s more trusted than other forms of news. So congratulations to my colleagues and their students for finding ways to make it better.

You can find more of their work at Storybench, a School of Journalism web publication that covers media innovation.

A conversation about news deserts and ghost newspapers

I had a chance Thursday to talk about news deserts and ghost newspapers with Gina Baleria, the host of the podcast called “News in Context.” Baleria is a former radio journalist who’s now an assistant professor of journalism, media writing and digital media at Sonoma State University. You can listen to our conversation or grab the feed right here.