A few months ago Pierre and Randy Ching founded Peer News. Their first project was a Twitter-related experiment called Ginx, which didn't get critical mass and is being closed.

Now they've announced Peer News' more important move -- a project aimed at creating the kind of local journalism that brings accountability and value to a community.

Pierre, in a note on the company blog, says he and his team are launching -- they aim for early 2010 -- based on deep research: "talking to a lot of people in the industry about journalism and how we might be able to have an impact, listening and learning as much as we can."

I'm one of the people Pierre has talked with, but I'm not privy to the details of the new venture. In a conversation last evening, he did say this will be service combining professional journalists and citizen journalists in "a commercial model that hasn't been tried yet."

Tantalizing, no? Let's focus for a second on the word "commercial," because Pierre and team are going for something that seems to have fallen somewhat out of favor for local news startups, the notion that they can and should be profitable. Not-for-profits are springing up in various places, and while Pierre is happy to see them he also believes it's essential to find solid for-profit models for sustainable media.

One message is for the local newspapers: Watch out. Pierre has analyzed the Hawaii media market and sees enough advertising money is going toward journalism in Honolulu "to fund a high quality operation" -- but clearly not the kind that dominates the revenue stream today, namely the local newspapers.

Peer News will operate in the leanest possible way compatible with doing solid journalism and community information. It will involve social media in a big way as well. (The Omidyar Network, the investing and charitable arm of Pierre and his wife, Pam, has been deep into socially valuable media for a long time. Count on them bringing what they've learned into Peer News.)

Plainly, the Hawaii launch is a test bed, in part. If it works, expect more local versions in other places.

Peer News is looking for a founding editor. My advice has been to find someone local, if at all possible, but especially to find someone excellent. If you're interested, here's where you can find out more.

One of the people who'll be talking to editorial candidates is Howard Weaver, a former vice president of news at McClatchy. Howard has been consulting with Peer News and offers some perspective on his own blog, including this:

I'm interested for a lot of reasons, but I'd sum it up this way: the new venture intends to demonstrate that a digitally native, technologically fluent web organization can profitably serve targeted readers who want sophisticated journalism focused on local civic affairs.

So I'm looking forward to following the progress of Peer News. So should anyone who's interested in the future of journalism.

(Note: The Omidyar Network was a seed funder of my long-ago Grassroots Media (Bayosphere) project. It lost money. Cross-posted from Mediactive.)

I recently received an email from NowPublic, a popular citizen journalism website in North America, with the subject "Now Hiring." This is a rare thing in the field of journalism these days - citizen or traditional - and so I wanted to see what they are paying for and how they are covering the expenses. It turns out that NowPublic is not paying you to be a journalist - that is, not to publish content, but rather to read it. And, more importantly, to get others to read it. They will pay you for "views, visitors, and ad clicks." And they will pay you to refer others to view content and click on ads. In economic terms we would say they are paying to create a false demand for an overabundant supply.

For me, this exemplifies the state of news media: there is now, for the first time in the history of the world, an abundance of content and a scarcity of attention. But how did we get here? To better understand that we need to go back to 1435 in Northern France when Jean Miélot, a French priest and scholar, first began working as a scribe for Philip the Good, the Duke of Burgundy.

Since the invention of the papyrus scroll in Egypt over 4,000 years ago, this is how books were always produced: by hand, and one by one. Scribes almost always worked either for the church or for the aristocracy, and so princes and priests decided which books were to be copied, and which were to be banned. In 1435 Jean Miélot was given what was at the time thought to be a very prestigious job, just as prestige was associated with journalism as little as five years ago.

But then something happened. Just one year after Jean Miélot was given his job as a scribe for the Duke of Burgundy, a German goldsmith named Johannes Gutenberg began working on a new invention. Taking inspiration from mechanical presses that helped produce olive oil and wine, Gutenberg invented movable type, which allowed for the mass production of books. In retrospect, it is hard to overstate the importance of this invention in Europe and, eventually, throughout the world. Previously it took months just to produce a single copy of a book. Now in a week you could create thousands.

Slowly, ever so slowly, books began to spread across Europe. In the 1440's, 50's, and 60's the book was the new media of the day. And just like it has taken the world a long time to understand the power of the internet, it took Europe many decades to understand the social impact of the printed book.

There is a great irony that Johannes Gutenberg is best known for printing the Gutenberg Bible in the 1450's. Previously, every bible was hand copied by scribes, and only priests and princes had access to what was considered the great book of wisdom. Other Europeans depended on priests to transmit the contents of the bible during their weekly sermons. I say that there is irony in the Gutenberg Bible because the Gutenberg printing press was eventually responsible for taking power away from the Vatican and the Catholic Church.

70 years after the Gutenberg Bible was published it finally became common for European authors to publish their own books using the printing press. Martin Luther was one author to do that. In 1522 he published a translation of the Bible in German rather than standard Latin. This was a direct challenge to the power of the Catholic church. Instead of relying on the few trained priests and scholars who spoke Latin, the Bible was now accessible to all literate Germans.

He then published his 95 Theses which quickly spread all over Europe, led to the Protestant Reformation, and the fall of the Vatican as the center of power in Europe. Without the printing press the Reformation could not have never happened.

Nor would have the Scientific Revolution of the 17th century or the Enlightenment of the 18th century. Both movements depended on the rapid and broad dissemination of ideas such as Copernicus' On the Revolutions of the Heavenly Spheres, Vesalius' On the fabric of the human body in seven books and Descartes' Discourse on the Method. Perhaps the scientific revolution was actually ready to spread much earlier, but there was no way for the thinkers to publish, share, and build on the ideas of others.

And, of course, there would be no journalism were it not for the printing press. This is a copy of the London Gazette, which was the first regularly published newspaper, and began as the Oxford Gazette in 1665.

The point that I am trying to make is that some technological innovations are so revolutionary that they change everything. The Gutenberg Press led to the Protestant Reformation, the Scientific Revolution, journalism, the Enlightenment, and, arguably, representative democracy. It created what is today a European continent with near universal literacy.

Before movable type, Europeans depended on priests to know what was inside of a book. Now they simply open its cover. That is a revolutionary difference. But what is important to remember is that not everyone benefited from the printing press. Scribes all across Europe protested. There aren't good records of their protests, but I can just imagine their reasoning: that people would be overwhelmed by too much information; that they would become isolated reading at home rather than coming to church; that mediocrity would prevail if publishing was put into the hands of ordinary people. Basically, all of the same criticisms we hear of the Internet today. In the end, the scribes lost and the printing press won. With the benefit of historical perspective, we view the result as inevitable. And we are seeing the same dynamic play out today with traditional journalism and the participatory internet.

In the US a major newspaper closes down just about every week. Those that haven't closed down yet are all losing money. There is no single major newspaper in the US right now that isn't losing money. The question isn't if the old model of journalism will die out, but when.

Which brings me to the next topic: that the World Wide Web is proving itself to be just as disruptive of a technology today as the Gutenberg Press was in the 15th century. The internet is growing up. There are now more Chinese internet users online than Americans.

Pew Internet found that one out of every five internet users in the United States uses a service like Facebook or Twitter to regularly update their status. For Ukrainians it might be LiveJournal and Kontact.

Two American researchers, Denis G. Pelli and Charles Bigelow, argue that we are charting a path toward "nearly universal authorship." In their study they charted the rise of book authors per year from 1400 to today and compared that data with the number of blog authors, Facebook authors, and Twitter authors over the past ten years. As you can see in the above chart, it took 600 years to reach one million book authors per year. In contrast, it only took five years to reach a million blog authors, three years to reach a million Facebook authors, and two years to reach a million Twitter authors. What will be next?

There are some technological innovations are so revolutionary that they change everything.

What is the role of media if everyone is part of the production process? I believe that we will continue to see a rise in what Jessica Clark of the Center for Social Media calls "people centric media," which spreads information, communication, and social capital across networks based on location, issues, and events. But how will media organizations and projects survive in an era where content is so abundant that no one is willing to pay for it? I want to stress that no matter how many conferences are held and white papers are published, there will never be a silver bullet to save the media industry. It is as useless of a task as convening scribes in the 15th century to discuss how they can save their industry. However, several new models and strategies are emerging which offer a glimpse into the future of people centric media.

Make the readers the journalists. In August 2008 the New York Times published a beautiful visualization of the final subway stops for every subway line in New York City. To do this they sent out reporters to take pictures, collect audio, and file their reports. A year later, a similar project called Mapping Main Street accepts contributions from anyone. It still requires an editor and designer, but in Mapping Main Street there is no distinction between reader and reporter.

Remove unnecessary reporters. Newspapers used to hire reporters to go to the police department, ask for the crime report, and then copy and publish it in the newspaper. Today that information can be published immediately and directly. Everyblock scrapes information from government websites and makes it available for ordinary citizens via web browser and mobile phone. Just as Europeans used to have to rely on priests to understand what was in a book, citizens used to rely on newspapers to understand about their community. Now they can see and engage with the information for themselves.

Remove unnecessary editors. Newspapers have a limited amount of space. Editors had to decide what was included in that space and what wasn't. They were the ultimate gatekeepers of the day's news. Today we are not limited by space, but rather time and attention. NewsTrust is a collaborative editorial site open to anyone which seeks to collectively rank the most relevant and trustworthy news.

Some reporting will always be expensive. For example, a 13,000 word New York Times article on events at Memorial Medical Center following Hurricane Katrina took two years and $400,000 to produce. With a $35.6 million loss last quarter, the New York Times can't invest $400k in a single story. Fortunately for the Times, a non-profit organization called ProPublica footed most of the bill. ProPublica is funded by billionaire Herb Sandler who founded the Sandler Foundation in October 2006 after he got out of the finance and mortgage industry. (Good timing!)

Get your local community to fund local reporting. You can either get a few very wealthy individuals/organizations to fund your work, or you can get many people to donate a small amount of money to pay a journalist to report a story. This is the model of San Fransisco-based Spot.us, which describes itself as "community funded reporting." Any journalist can make a pitch on the site about a story that he or she would like to report on. For example, in early July Lindsey Hoshaw was given an opportunity to board a ship to visit the Great Pacific Garbage Patch and report on it for the New York Times. But apparently, neither she nor the New York Times had the $10,000 to pay for the travel expenses. And so Hoshaw recorded a video of herself explaining why the reporting was important, why people should pitch in to help her cover the story.

Ellen Miller, the executive director of the Sunlight Foundation, pitched in $20. Tim O'Reilly, a well-known open source technologist and publisher, pitched in $100. Pierre Omidyar, the founder of eBay, pitched in $100. Craig Newmark, the founder of Craigslist, pitched in $50. Zoe Keating, a well known cellist offered another $20. Jennifer 8. Lee, a reporter for the metro section of the New York Times, donated $30. (Perhaps she felt bad that the New York Times was still able to pay her, but not Hoshaw.)

Four months after Hoshaw made her pitch on Spot.us her story was published in the New York Times with an accompanying slideshow.

Give some away for free, charge for the rest. This is the business model that is mentioned most often these days as a way to keep news organizations afloat. It is the strategy of GlobalPost, an international news site. You can go there now and read more articles for free than you likely have time for. But if you're a real international news junkie, then you can pay an extra $200 a year for their "Passport" membership, which "offers an entrée into GlobalPost's inner circle." A couple weeks ago GlobalPost founder Phil Balboni claimed that so far they have 500 paying subscribers to Passport. He also claimed that GlobalPost is on pace to generate $1 million in revenue this yaer. (Their annual expenses are $5 million.)

At Global Voices the majority of our expenses are covered by private philanthropic foundations. The rest of our funding comes from four other sources: content commissions and underwriting, advertising, consulting, and online donations.

As you can see, it is becoming more and more difficult to find funding to support both media organizations and journalistic coverage. Then again, it might prove to be even more difficult to find anyone to pay attention to what you publish. It seems that the scarcity of attention is even more severe than the scarcity of funding.

In part one of this series I looked at the history of media development, the major players in the field, and some of the current obstacles - from regulatory reform to linguistic divides - that stand in the way of a healthy media ecosystem. In part two I examined points of agreement and tension among those directly involved in media development, and the recommendations that they made to a group of donors who gathered in a subsequent meeting. In this third and final post I will attempt to summarize the main themes at the meeting of funders, and look at the field of media development from the funder's perspective.

Has Media Freedom Waned Since the Fall of the Berlin Wall?

Eric Newton, Vice President for Journalism at the Knight Foundation, began the three-day meeting at the Salzburg Global Seminar with a series of maps from Freedom House charting media freedom since 1989 until today. While it is difficult to aggregate imperfect data across entire countries, much less the whole world, these global maps show a slight decline in media freedom over the past twenty years. Why is there an alleged decline in media freedom worldwide when over $600 million has been spent on media development during that time? For Newton, the explanation lies in the fact that "governments and funders have failed to recognize and take advantage of the incredible potential of digital media." He points to the Knight Foundation's own $25 million News Challenge initiative as an attempt to push the innovation and adoption of digital media tools and applications. Newton says that this is the third major meeting of funders involved in the field of media development. "It didn't work in London," he said, "it didn't work in Paris. So now we're trying Salzburg."

Amadou Ba, the co-founder of AllAfrica.com and executive director of the African Media Initiative then took to the podium for his keynote address. He began by quoting Thomas Jefferson: "If I had to choose between government without newspapers, and newspapers without government, I wouldn't hesitate to choose the latter." He also cited Amartya Sen who claims that "no substantial famine has ever occurred in any country with a relatively free press." Ba feels that media is "an essential public good, which informs people of their rights." He recounted a conversation he once had with an unpopular African leader who Ba had hoped would increase federal media investment. "Why would I help feed the monster that wants me out of my seat?" the leader responded. For Ba, the response shows why healthy media is such a crucial ingredient in the recipe of democracy.

But, despite the clear importance of press freedom, he feels that funders have little to show for their millions of dollars of investment. Unlike Newton, Ba doesn't see a lack of engagement with digital media to be the problem, but rather a lack of trust by donors in the local leadership of African media outlets. Unsurprisingly, his answer is to invest more in networks like the African Media Initiative, which brings together owners and operators of major media companies in Africa to increase cooperation, coordinate on relevant research, and advocate for better media regulation.

More Investment or a Better Understanding of What Works?

Troy Etulain, the senior advisor for Independent Media Development at USAID left the first evening's discussions unsatisfied:

"There was talk tonight about 'underinvestment.' That's too vague. What's the logical math? If there had been more investment would there have been more development?

Much of the conversation during the next day remained stuck on this issue of whether or not funding in media development over the years has been effective or not. Marguerite Sullivan of CIMA presented numbers from a study which found that globally $600 million has been spent on media development. Forty four percent went to training and twenty eight percent was direct assistance to support the operational costs of media organizations. Sullivan noted that among US government funders there are almost no experts in the field of media development (four people in USAID and one person in the state department) and that media development at USAID is a sub-sub sector of the Democracy Assistance program. For Stewart Chisolm, the senior program manager of OSI's Media Program, the level of direct investment in the media organizations is still too low.

Mark Koenig, challenging the assertion by Newton and Ba that media development has failed, presented research which showed that media assistance had the highest degree of positive correlation of impact among all of USAID's Civil Society initiatives. Brian Levy, an advisor at the World Bank, also presented research which shows a positive correlation between information access and effective development.

Vanessa Mazal of the Bill & Melinda Gates Global Development Program felt that media development has traditionally been too focused on training reporters, and that more resources should be invested in the business and management aspects of journalism in order to make the organizations sustainable. Nazeer Ladhani of the Aga Khan Development Network stressed that funders should help establish locally managed institutions like the Aga Khan Universities in Pakistan and Nairobi to foster indigenous leadership and implement sustainable training programs in partnership with local companies.

Metrics for Success

How do funders know if their investments have an impact not just on the media landscape, but also in terms of better governance and more effective development? None of the funders seemed content with the current metrics for evaluating media worldwide. Some felt that IREX's Media Sustainability Index was outdated, to which Mark Whitehouse, director of Media Development Programs at IREX, responded that, rather than criticizing metrics, the conversation should focus on how to improve them. Pia Hallonsten of the Swedish International Development Agency would like to see more longterm longitudinal studies which look at the impact of media development programs over many years.

Peter Goldstein, the director of online communications at InterMedia, presented the initial findings from AudienceScapes, a new media analysis initiative funded by Gates Foundation and set to launch in January 2010. AudienceScapes aggregates data about media from a variety of sources and supplements it with their own questionnaires. Among the topics in their surveys: demographic information, access to ICTs, usage patterns, mobile phone use, internet use, personal finance, health, and agriculture. Goldstein says that AudienceScapes' data will be available to the public without a subscription, but that they are looking into a business model which would make special information and reports available to paying customers. A sample of AudienceScapes' policy research with focus on Ghana was presented.

Pippa Noris of Harvard University's Kennedy School of Government presented the some of the research and conclusions from her latest book Public Sentinel: News Media and the Governance Agenda, which she has summarized in a post on her blog. Norris stressed that data about the impact of media, and about governance in general, is far from perfect, but suggested that the media development community should collaborate more closely with academic researchers from the International Communication Association, which focuses on the impact of media on society.

Good Media for Good Governance

Much of the conversation over the first two days treated media development as a goal in itself, or as part of a strategy to further other development objectives (like health and agriculture). James Deane of the BBC World Service Trust said he would like to shift the conversation to focus on good governance first, and media as a part of that. Most of the speakers on the panel represented multilateral development agencies like the World Bank, the UNDP, and the Asian Development Bank whose clients are national governments. Deane feels that good media is a requirement for good governance; that quality media outlets serves as irreplaceable public watchdogs. He also notes that good media can help spur economic development by battling government and corporate corruption. (BBC World Service Trust published a 40-page report on "Governance and the Media" in April, 2009.)

Pray the Devil Back to Hell, which documents how Liberian women blockaded the Presidential Palace until a peace agreement was signed, was one anecdote cited as an example of how media can lead to improved governance. But there were also murmuring whispers of the role of radio stations during the Rwandan genocide, and how media can also lead to chaos and brutality.) Both Brian Levy from the World Bank and Bjorn Forde from UNDP alluded to internal distrust at their organizations toward media. They insisted that they weren't involved in outright media development, but that they value the role of transparent information in making development more effective. Both David Hoffman of Internews and Eric Netwon of Knight Foundation felt that large development agencies should cooperate more closely with media development initiatives to further the goals of both.

Final Thoughts

As a mostly silent observer, it seemed to me that the representatives from funding organizations were more concerned with convincing one another that they were making an impact than in thinking of ways to more effectively support the work of their grantees and promote cooperation to engage all aspects of a dynamic media ecosystem for the 21st century.

During the first meeting of media development practitioners there was general agreement that most funders were not sufficiently aware of the needs of the organizations implementing projects, and that funders are not up to date on the latest innovations taking place in the media field. One idea was to organize an online one-week fair so that media development organizations and funders can each learn more about the needs of each other. Unfortunately, when this idea was presented at the meeting of funders, there was apparently little interest.

I have personally witnessed several worthwhile media development projects die out because there was no clear pathway from initial seed funding (often won through some sort of competition like Changemakers or Ideablob) to "mezzanine funding" in order to scale up and then sustainability funding to support basic operating costs. If there was more open dialog between practitioners and funders - and among funders - then there wouldn't be such a high turnover rate and so little expertise in the field.

In part one I looked at the history of media development, the major players in the field, and some of the current obstacles - from regulatory reform to the linguistic divides - that stand in the way of a healthy media ecosystem. In this folow-up post I will continue to summarize the discussions which took place at a meeting earlier this month at Salzburg Global Seminar where representatives from the field of media development and funders who have supported their work all gathered to discuss how to more effectively "strengthen independent media."

The week-long meeting was divided into two parts, first convening practitioners involved in media development projects for three days, and then representatives from funding organizations for a separate, succeeding three-day meeting. (Some funders were resistant to participation from non-funders, I was told as an explanation for why the two meetings were held separately.)

Better Access or Training?

A recurring tension during the meeting of practitioners was whether investment in the field should focus on lowering the barriers to participation (by bringing down the cost of connectivity and making intuitive tools easily accessible), or on training programs which teach participants how to use new media tools to build community, monitor government, and promote development. Erik Hersman, one of the co-founders of Ushahidi, feels that if enough citizens have access to participatory media tools like Ushahidi, then a culture of tinkering will necessarily follow without costly training programs. Josh Goldstein echoed Erik's observation, pointing to the pervasive use of MXit, a mobile social network in South Africa. Ramsey Tesdell of 7iber, however, was skeptical of the "if you build it, they will come" mentality. "Technology is easy," he said, "it's building a community that is hard." Others added that there is no shortage of online tools available to all, but that active participation is still restricted to mainly elites.

The role of "quality" in media development was another repeated tension. Joyce Barnathan of the International Center for Journalists felt that the conversation was too focused on quantity - in terms of encouraging a larger number of media producers - and not enough on the quality of the content that is produced. Ivan Sigal of Global Voices, in language reminiscent of Pierre Bourdieu, observed that "quality" is often a coded word to distinguish those who are allowed to speak and those who aren't; that the concept is often meant to serve individuals inside exclusive institutions. Benjamin Glahn, the facilitator of the meeting, put it in more diplomatic terms: "quality is a process, not a static achievement."

Rob Faris of the Berkman Center for Internet and Society noted that much of the conversation over the three days focused on augmenting the supply of media - that is, encouraging more people to produce more and better content - but that there was little discussion about the issue of demand for content, especially from developing countries. All participants agreed that media literacy education is a fundamental component of a healthy media system. At Global Voices, for example, we have been encouraged by high school teachers and university professors who integrate our content into their syllabi.

During the second and third days of the meeting a number of the participants presented their projects. In addition to some of the latest work of Appfrica Labs and Overmundo, which I wrote about previously, we also heard from Tihomir Loza and Alexey Leonchik of Transitions Online, Serhii Danylenko of the pro-am journalism Ukrainian journalism portal Highway, Alex Park of Moby Group, John West of the Institute for War & Peace Reporting, Arturs Mednis of Jaffa.lv, and Ramsey Tesdell of 7iber.com.

Generational Divide

A generational divide between younger activists who grew up using digital tools and older representatives from major institutions who are wary of the changes taking place in the media field was readily apparent. Arturs, Ramsey, and Sergii - all in their late 20s - said they couldn't be bothered with the paperwork, bureaucracy, and reporting requirements that are necessary to receive funding from major foundations. They would rather spend their time holding workshops, building websites, and creating community. Older participants in the room were all appreciative of their work and their voluntary ethos, but were concerned that the lifestyle isn't sustainable once marriage, mortgage, and children enter the picture.

By the end of the three-day meeting the participants agreed on a summary of major discussion points to be presented to the funders for their consideration. There was agreement that funders need to find ways to support the work of passionate and talented individuals like Arturs, Ramsey, and Sergii. One possible solution is to support intermediary funders like Rising Voices and Mobile Active which can give more attention to small scale innovation that often stays off the radar of large philanthropic foundations. Funders should keep in mind the need to reduce barriers to access as much as implementing training programs. This can be done by working with telecommunication companies to convince them that lowering their fees will increase their number of customers, or by working with regulatory agencies to increase competition and encourage more service providers to enter the market.

There should be more cooperation among donors so that successful media development projects have a clear pathway from initial start-up funding (for example, a microgrant to test the idea) to second stage funding in order to scale up, and finally sustained funding of staff and recurrent costs. Donors can also cooperate to streamline the application process so that media development project leaders spend more time on their work and less time writing separate proposals for each funder. Donors should avoid financing closed, proprietary tools and rather invest in open source tools and open source communities. Funders should be more up-to-date with innovations and trends in digital media and there should be more open communication between the funding community and the media development community. Funders can also take better advantage of their role to encourage cooperation between complementary (and even competing) projects.

In the third and final part of this series I will summarize the discussions that took place in the funders' meeting. Were they receptive to the suggestions made by practitioners? How do funders measure the impact of their investments? What do they see as the hallmarks of healthy media? What can be done from the funder's perspective to encourage sustainability in a field that is as chaotic and fast-paced as media? All this and more coming soon.

Our launch party in Tempe this past month led me to realize that this is all just now starting...

Up until that moment CityCircles had been a concept that we've had to explain to our friends and colleagues - using hand gestures or drawings. Many people thought the idea was cool but just couldn't visualize it. Lots of people asked: "when can we play with it??"

On October 8th we finally had something to show our constituents! At our launch party we demo'd the alpha site and received lots of great feedback. With every comment made by our audience (about 70 or so individuals) I realized how much potential this project has and how much work is yet to be done.

In the meantime (while our brilliant programmers are hammering away on changes, additions, features and functions) Adam and I have been working on building relationships with the communities around the light rail as well as the local merchants. We're looking for participation from the communities in creating content for our site - neighborhood news, community improvement projects, neighborhood events, etc.

Getting buy-in from local merchants will be crucial in building a sustainable business model. So far a lot of local businesses have expressed enthusiasm in trying to promote via our site. We've got some eager participants who can't wait to see this site launch.

We're trying our best to build momentum before CityCircles is released to the public. We'll be sending some invites out this week so we can get users to play with the site and provide as much feedback as possible. However, we plan on releasing new functionality and features very often in the next coming months.

The Bay Area News Project has a web site and a Twitter feed. The San Francisco Chronicle had a story. And so did the New York Times.

There are few details available about the project, in part because they haven't really been worked out. But the news is emblematic of something much larger going on across the country. As various people try to figure out the future of news, the non-profit model has gained substantial momentum.

This struck me last week while I was attending the two-day UC Berkeley Media Technology Summit at Google.

Presenters from the non-profit journalism world gave some interesting insight into how the model works and, in some cases, doesn't. It left me with a sense of the challenges the Hellman project faces to get off the ground and have an impact. The odds are against most start-ups. And that's no different for non-profit news organizations.

A 'kvetch-free' journalism conference

The Berkeley-Google conference was devoted to exploring the intersection between technology, news, and business models. It was organized by Alan Mutter, who blogs at Reflections Of A Newsosaur. You can find Alan's opening thoughts here, and his takeaways on having what he called a "kvetch-free journalism conference" here.

Besides being hosted by Google, it was presented by the Graduate School of Journalism at Berkeley and the Haas School of Business at Berkeley. Sponsors included The Koret Foundation, Google, and the McCormick Foundation.

There were lots of interesting tidbits about various technology trends. For notes on the conference, you can search Twitter for #mts to see all the tweets (and there were a surprising number of tweeters there). The tweets were also being captured by live bloggers on day one and day two. There were a lot of interesting thoughts on things news organizations could be doing more efficiently or effectively to increase traffic, engagement, and advertising revenue. But, frankly, there wasn't much that sounded revolutionary or that would move the needle.

It was the discussion about non-profit models that I found most intriguing. Not because I necessarily believe that's where the future lies, but because at this moment so many others clearly do. There are enough emerging or current non-profit experiments that over the next couple of years we should have a pretty good sense of whether or not this model is relevant and sustainable.

The NPR Model

One of the speakers at Google was Ellen Weiss, the senior vice president for news at National Public Radio. Weiss, who has been at NPR for almost two decades, summed it up nicely when she said that the non-profit model seemed a bit like the "flavor of the month."

For better or for worse, non-profit news organizations represent a big departure in terms of business models from the for-profit mainstream model. In a way, it seems like some of this push is driven by a sense of resignation that a new model can't be found to reinvent for-profit news. I don't buy that. But, clearly, others do.

The highest profile non-profit effort to date is ProPublica, the investigative journalism organization. There's also Investigate West, Voice of San Diego, and Minnpost.com. Already in San Francisco, there's The Public Press and California Watch. There are many, many others out there.

In an era of financial challenges, the so-called NPR model seems appealing to many newsrooms. But Weiss delivered a little reality check. Of NPR's $166 million budget, 40 percent of that comes from member stations and 30 percent comes from corporate sponsorship. NPR gets no money directly from the federal government, Weiss said.

She noted that folks from a traditional media background don't always understand how hard it was to build that model. In NPR's case, they've had 35 years. Of ProPublica, she pointed out that the organization was started with a large personal donation, a "lightning strike," as she called it. But they haven't proved they have a sustainable model.

The problem is that if the non-profit model catches on too much, then what little money that exists to support these organizations will be stretched too thin. "One girl selling girl scout cookies is cute," Weiss said. "Two are okay. Three or more is just annoying."

Her bottom line: "Will non-profits save us all? They're an essential ingredient. But I doubt it."

Texas Tribune

Another fascinating non-profit presentation came from John Thornton, a partner in Austin Ventures and chairman of the Texas Tribune. Thornton is hoping to launch the Tribune next year, and has raised $3.5 million of the $4.5 million targeted. Just last week, Thornton announced he'd bagged another $750,000.

But that money really is just a start. Thornton provided a lot of useful data and shared his spreadsheets with the conference. According to his calculations, the organization needs to raise $1.3 million in donations every year to support a newsroom of 10 full-time journalists.

Thornton said people donate $20 million each year to dance non-profits in Texas. From that perspective, he said getting $1.3 million each year doesn't seem like big hill to climb.

We'll see.

Perhaps the most cautionary tale came from Geoff Dougherty, a fellow blogger here at Idea Lab and founder and CEO of the Chi-Town Daily News. Dougherty's grant was to "recruit and train a network of 75 citizen journalists -- one in each Chicago neighborhood." But despite his efforts, Dougherty said at Google that the support from the local philanthropic community didn't materialize to sustain it.

Last month, Dougherty announced Chi-Town was going to re-launch using a for-profit model.

Bay Area News Project

All this brings us back to Hellman and the Bay Area News Project. UC Berkeley Dean Neil Henry gave a short presentation at Google, but he didn't reveal much more than had already been announced. Here's what we do know.

The goal is create a news organization that employs full-time journalists, perhaps anywhere from 10 to 15 to start. They hope to leverage KQED's fundraising experience. And they're exploring a partnership with the New York Times to provide content for that paper's new Bay Area edition.

Beyond that, there are lots of blanks to be filled in. The first step is to hire a CEO and/or executive editor to actually map out what this organization can and should be, what it will do, and how it will operate. This is a tall order. And an expensive one. I had been telling folks that to find someone with the right set of skills and experience, they'd have to be paid well over six figures in salary.

Then I saw Mutter's post that included information about the top salaries paid to ProPublica editors. Editor Paul E. Steiger got a whopping salary of $570,000 while the number two editor pulled in $296,370. Whoa. That will eat up Hellman's money right quick.

This leads to my own reality check: $5 million sounds like a lot. But it's not. Not when you're talking about starting an actual news organization with paid reporters. The same day the project was announced, I happened to be visiting a start-up in San Mateo called Caring.com, which produces content related to elder care. The CEO said he needed to raise "a little money" to get through the next year, about "$5 million or $6 million dollars." That would sustain an online-only content start-up with a staff of 14 that already has a growing revenue stream.

All of this is to say that $5 million is purely seed money. KQED and the other parties are going to need to put serious fundraising muscle behind this. They still need to hire a CEO, executive editor, and staff. It's going to be some time before it's having any impact on the ground.

The reaction to Hellman's project has ranged widely, and I must say I'm quite surprised. On the positive side, David Cohn weighed in with advice for Hellman, including to hire folks who think "web first."

But not everyone was giddy. Popular local blogger Greg Dewar, who writes the N-Judah Chronicles on the Njudah blog, tweeted: "this Hellman/KQED/UCB J School thing sounds like a disaster in the making, at least for us who don't have wealthy financiers..."

And Suzanne Yada tweeted: "@mediatwit I am only officially speaking for myself re: Public-Press. But yes, I feel like Hellman ganked our model & left us to dry TBH." The Public Press, for which Yada does some work, had been operating through bootstrapping and small grants.

The East Bay Express worried that this project "threatens traditional news media in the Bay Area, because it will rely on 120 journalism students at Cal who will work for free."

I think the fears of the other local and hyper-local news start-ups are valid. Hopefully, the organization will take a collaborative approach that builds the news ecosystem.

Finally, if you want to hear from some of the folks involved in Hellman's project, check out this interview from KQED's Forum:

• Internews, which was formed in 1982 during the Cold War dynamic of international relations.
• IREX, which was founded in 1968 and was similarly established to promote more free-flowing information between the Soviet Union and the United States.
• Panos, a UK-based network of NGO's that focus on media development in the Caribbean, Eastern Africa, Francophone Africa, South Asia, Southern Africa, and West Africa.
• BBC World Service Trust, which works on media development focused on six topics in over 40 developing countries.
• The International Center for Journalists, which was founded 25 years ago and specializes in providing fellowships to journalists who share their expertise in developing countries.

Then there are hundreds, if not thousands, of smaller media development groups at the regional, national, and local level. The Media Institute of Southern Africa, the Southeast Asian Press Alliance, CALANDRIA, and the Liberia Media Center are all examples. Many - though not all - of these groups are members of the Global Forum for Media Development, which organizes a global conference once every three years (most recently in Athens in 2008) and, more frequently, smaller regional events.

The transition in the media industry from the broadcast and print era to digital, participatory media has led media development organizations to re-think their strategies and investment priorities. That's why I'm at the Salzburg Global Seminar in Austria this week with a group of media development professionals, new media enthusiasts, and a handful of researchers and funders. We are gathered here for a three-day meeting to make recommendations to funders as to how they can most effectively help bring about a healthy global media ecosystem.

Ivan Sigal - Obstacles to a healthy media ecosystem

Ivan Sigal, executive editor of Global Voices, kicked off the first day's discussion by pointing out several obstacles that currently stand in the way of healthy media systems on a global level. These include:

• Public and private telecommunications infrastructure
• Regulatory and media law issues
• Language and translation
• Social and digital divides
• Technical issues (eg. available fonts in local languages)
• Access to equipment, training, and tutorials
• Access to generative technologies

I suggested that 1.) censorship and 2.) audience (or lack thereof) are two other obstacles to a healthy flow of media, information, and participation.

Ivan went on to stress that these different obstacles vary and manifest themselves in different ways in different parts of the world. He noted that 'country' is not always the best lens to think about where the obstacles exist and how to confront them, and that culture has an impact on how digital communities are incentivized.

Josh Goldstein - Working against or with telecommunications companies

Josh Goldstein then followed up. He explained that he would present both from his perspective as a fellow this past summer at Appfrica Labs in Kampala, Uganda and in his new position at UNICEF Innovation, which is looking at how to spur and implement more innovation throughout UNICEF's 191 country offices. Or, as he put it, his summer experience in Uganda revealed to him what obstacles stand in the way of success for tech-savvy web entrepreneurs like Jon Gosier. In his new job he will try to leverage UNICEF's position to help bring down some of those barriers to entry.

One of the greatest obstacles for a healthy media ecosystem, Josh points out, is simply the cost of access to information. Rwandans, for example, spend an estimated 65% of their disposable income (and 17% of total income) just on mobile access.

In fact, on the tails of The Economist's recent cheerleading of mobile phones in development, Josh published a cautionary note at VentureBeat explaining that a single text message can run as much as ten cents per message in Uganda, a prohibitively high cost for most Ugandans.

Earlier this year Appfrica Labs programmer Felix Kitaka developed Status.ug, a local Twitter-like clone for Ugandans which allows them to update their Facebook and Twitter statuses directly via text message. The service has yet to really take off, however, because most Ugandans still aren't able to afford frequent text messaging. Twitter has proven itself to be an important (although often overstated) tool for activists. Those same opportunities aren't available in Uganda, however, because there is not enough competition in the mobile wireless industry to bring down the price of participation. Josh points out that there are two strategies to lower the cost of access to information. First, you could seek government support for regulation which forces telecommunications companies to lower their fees. This is the type of advocacy work that the Knight Foundation has been involved in with the Federal Communication Commission in the United States. The second option, which Josh seems more enthusiastic about, is meeting directly with the telecommunications companies to convince them that if they lower their costs they will make up for it in greater volume.

Felipe Vaz - LAN houses as informal spaces of digital inclusion

Felipe Vaz of Overmundo shows an example of how informal digital media development is frequently taking place outside of government, education, or civil society organizations. Those more formal organizations must then decide if they will co-opt, support, oppose, or stay away from the informal structures that have developed.

In this case Felipe introduces us to LAN houses, which Paula Goés has written about extensively on Global Voices. These LAN houses initially began as local networks where (mostly) young people would go to play multiplayer games like World of Warcraft. More recently they have connected to the internet and are used for social networking, chatting, and job searching. The estimated 90,000 LAN houses across Brazil account for 50% of available internet access in the country. These are illegal operations which don't have business permits and don't pay taxes. The Brazilian government so far has taken an adversarial position toward the LAN houses, arguing that they encourage young people to miss class. But others, like Brazilian blogger Jeimy Remir, think that LAN houses have a positive impact both for their owners and customers:

As a fruit of creativity and entrepreneurship, starting lan houses has changed the lives of their owners. Usually attached to their own houses, the lan houses come in stylized environments, often set up in their home garages with different lighting and decor. […] Another feature of the lan houses is to serve as meeting points for young people, looking to make friends, interact and flirt. With the communication tools currently available, such as instant messaging, orkut and chat, the use of space for similar purposes has increased and confirmed such environments as a reflection of society. […] For this reason, the lan houses assert both their power to bring digital inclusion by providing access to the Internet for people with low-incomes and their unique characteristics: they provide a source of income for those who manage them and meeting points for youngsters.

Felipe reminds us that illegal cyber-cafes are popping up in favelas and neighborhoods where business entrepreneurship is at a low level. Also, peer to peer training - such as how to upload a video to YouTube - takes places at these LAN houses. He believes that the government should legalize their operations and provide tax incentives so that Brazilians in underserved communities still have easy access to the benefits of the internet.

Final Thoughts

The three presentations highlight some of the various obstacles that currently stand in the way of a dynamic, participatory media ecosystem. They also show different ways in which funders can use their resources to promote more inclusive communication and access to information. They could engage at the government level to promote better regulation which brings down the costs of mobile internet access or, for example, starting a cyber-cafe. They could support translation efforts to bridge linguistic divides which prevent the sharing of information across cultures and communities. They could also support training initiatives so that online participation and digital media production is more representative of a community's entire population.

In the next post I'll dig deeper into some of the more specific issues related to donors giving money to fund new media development.

On one side of the fence you have pro-pay-wallers, led by the Murdochs, for whom pay walls seem to answer the question, "How are we going to solve the economic crisis in news?" They're in the process of trying to convince a great swath of big news organizations to stop providing their content free at the point of delivery. By doing this, the theory goes, they will enhance the value of news content by reviving scarcity and convince a new generation to start paying for news. The "freeniacs are wrong," writes Nicholas Carr, who adds that "Charging people for news, even online, is by no means an impossible dream."

On the other side you have the anti-pay-wallers, led by a growing and increasingly coherent group of technologists, liberal educationalists, and bloggers. They see pay walls as a complete misunderstanding of the new era of information abundance. To them, the construction of pay walls is a frantic attempt to recover a 20th century era of constrained media by a generation that "just doesn't get it."

Building pay walls is "desperate stuff," writes Stephen Foley. "It won't work, and if newspaper executives on both sides of the Atlantic follow Mr. Murdoch's apparent lead, I predict we will witness the collective suicide of scores of news organizations in the U.S. and elsewhere."

A debate that needs to refocus

Both sides are becoming more and more trenchant in their beliefs and are ramping up the rhetoric. But, as with the fight between the Big-Endians and Little-Endians in Gulliver's Travels (about which end to crack open your egg), this ideological dogmatism is distracting us from the more difficult questions. And it doesn't get us much closer to working out long term ways that will enable journalism to pay for itself.

The pro-pay-wallers need to acknowledge that pay walls are not the Holy Grail that will solve all their economic woes. They should listen to polls -- like the PaidContent UK/Harris poll from this week -- indicating that most people would leave their favorite news site for a free site elsewhere on the web if a pay wall was built. They should accept that it will not be possible to close the digital Pandora's Box that is the Internet and recreate the constrained published content environment of the 20th century.

The anti-pay-wallers should concede that there will be areas of content where pay walls work. Pay walls do not have to cordon off all -- or even the majority -- of information on a site. The Racing Post has a smart and sustainable hybrid strategy of offering significant amounts of content free, and only charging for that which it knows its readers highly value (as reported in the Independent earlier this week).

For £7.50 a month, members get a horse racing TV channel streamed live to their computer (for which 3,000 people signed up in the first week). For £9.50 a month, members can receive a "premium tipping service," and for £199.95 a year they can get "ultimate membership" with access to tips, races and the Racing Post database. Equally, the anti's should acknowledge that journalism, as we've grown to understand it, is far from free to produce.

Mired in ideological silos, the pro and anti-pay-wallers are also missing some of the most important aspects of the debate. How do you add value to the content itself, such that people will be more willing to pay for it? It's a question made more urgent for the Murdoch camp by the fact that most content becomes "invisible" as soon as it goes behind a pay wall.

The Hansel and Gretel theory

Here's where my Hansel and Gretel theory comes in. For those that don't remember the Grimm fairy tale, it goes something like this: Woodcutter's wife convinces woodcutter they can't afford to feed the children. Woodcutter therefore dumps children in the forest. But clever children find their way back by leaving a trail of pebbles. So woodcutter dumps them in forest again. This time, with only a breadcrumb trail, they can't get home. They then get imprisoned in a gingerbread house by an old witch and... you can read the rest here.

News stories have been, up untill now, a little like Hansel and Gretel's breadcrumbs. Spread by news organizations round the web, they quickly attract an audience, but that audience gobbles them up and rarely follows the breadcrumbs back home. What if instead of breadcrumbs, journalists and news organizations dropped pebbles? That way people wouldn't eat them and there would be more chance they could lead them back home.

The difference between a breadcrumb story and a pebble story is metadata. Embed some good consistent metadata in a story and it turns something ephemeral into something much more solid. People suddenly know, for example, where it came from. A story can have the equivalent of an address and a zip code built into it, so people follow it back by whatever trail they want.

Metadata has the significant added benefits that it is visible and malleable. It can be identified and picked up by search engines and aggregators. It can then be displayed so that people have enough information to know if they want more. It's a little like seeing the front page headlines on the newsstand before deciding to put your hand in your pocket for some change. It can also be used for cross-referencing stories, for digging through the archive, for building mash-ups.

Google has an example of how, using metadata, it can display more information about a site in its "search snippets." Similarly, we (the Media Standards Trust) have been working out how to best integrate metadata in news through our Knight / MacArthur Transparency Initiative.

The great pay wall debate is not going to end anytime soon -- but needs to be a little less polarized than it has been to date. Working out how to leave a trail of pebbles would be a good start.

[For more on this debate, see an excellent two-part series, The Great Debate Over Micropayments and Paid Content at MediaShift.]

There had been some online scuttlebutt around the way EveryBlock released its open source code, and then was bought by MSNBC.com, so I thought it would be a good idea to go straight to the source, with a Q&A with Holovaty himself. The following interview took place over email, and included a couple questions from folks via Twitter.

What was the toughest part of doing the acquisition?

Adrian Holovaty: I had never dealt with term sheets, purchase agreements and all that
deal-related stuff previously, so that was probably the toughest part. Fortunately, we had great lawyers, a number of friends kindly helped at various points along the way, and many entrepreneur-focused resources are available online these days. I'm happy with how the process went, and I learned a ton.

Did you have a backup plan for EveryBlock in case the acquisition didn't go through? What was it?

Holovaty: Yes, we were lucky to have several options for EveryBlock, but I'd rather not discuss them, out of respect for confidentiality. My ultimate personal backup plan was to try to make a living as a professional musician, selling recordings and online guitar lessons
and things like that.

I know NBC has plans to launch various local sites. Did they talk to you about how EveryBlock might be included in those?

Holovaty: We've been focused on getting the deal done and haven't dived too deep into specifics on strategy and tactics.

Tell me three things that the deal will help you expand on EveryBlock.

Holovaty: Three areas of expansion are:

• Expanding our coverage to include new cities.

• Expanding the amount of news we publish in the cities we already cover.

• Adding features that give EveryBlock a richer user experience.

Any downsides in making the deal with MSNBC?

Holovaty: They're not based in Chicago, which makes some things trickier but other things better (like the fact that our team will remain pretty autonomous). Other than that, I can't think of any huge downsides; if there were any, we wouldn't have done the deal.

What wisdom can you share with other Knight grantees about the process of moving from grant-funded project to one that's owned by a media company?

Holovaty: I haven't seen much difference so far, which is a credit to the folks at the Knight Foundation, who were incredibly hands-off during our two-year grant. We're essentially autonomous now with MSNBC.com, and we've been essentially autonomous for the past two years with Knight. I suspect the transition would be much less smooth with other
foundations or with other acquiring companies.

I'd like to know whether EveryBlock will continue to update the code and whether they plan to release more (as open source). (Question from Daniel Bachhuber via Twitter.)

Holovaty: We're going to play it by ear and see whether it makes sense to release updates to the code we released on June 30. We're under absolutely no obligation to release any, but, at the same time, we might do so if it makes sense to do so.

Did you get interest in a buyout from newspaper companies? If so, why didn't they fit? (Question from Jeff Sonderman via Twitter.)

Holovaty: This topic was a mini-meme around the time of the acquisition announcement, and it amused me to no end, because the question makes very little sense.

It's like asking me, after I put together a band of musicians, why I didn't choose the musician who spoke Portuguese. What difference does it make if a musician speaks Portuguese? I'm going to pick the band member based on how good of a musician he is, not which languages he speaks. That's completely unrelated. Of course, if our band planned to tour in Portugal, it might be a different story, but let's put it this way: the band is not planning to tour in Portugal.

With Office 2010, Microsoft must decide how much software it can give away online without undermining its lucrative desktop software business. If it doesn't make the right calculation, the software maker could find itself in the same position as newspapers that gave online content away and now are struggling to replace print revenue.

That second line is almost a throwaway, written with no attribution. That means that the notion has officially entered into conventional wisdom: Local newspapers screwed up by giving away for free the content everyone used to pay to consume.

Conventional wisdom, yes. And untrue.

Correcting this fundamental error is about more than just debating the past. Because this mistaken assumption is driving the debate about new business models for news.

I want to explain why I think this mistaken assumption is causing people to ask the wrong question about the future of local news. And what I think the right questions are. I want to try to reframe the discussion about business models to focus on where true opportunity and solutions might be found for journalism entrepreneurs to pursue.

First, let me address the first half of the assumption about "newspapers that gave away content." This assumes that people once paid for journalism.

The Myth of Paying for Journalism

Let's correct that right now: When it comes to local newspapers, people never paid for journalism.

Believing that they did represents a fundamental misunderstanding of what a local newspaper was, or is. Especially when it comes to the business of a local newspaper. And it's a tragic misreading that I hear repeated on all sides of the paid content debate, whether they're for or against charging for news online. (The equation is a bit different for national newspapers like the New York Times or USA Today. But I'll leave that for another time.)

Let's review the actual business of a local newspaper, at least as it used to be. Back in February, when I was attending a Knight Digital Media Center workshop at the University of California at Berkeley, we heard a presentation from Lauren Rich Fine, a former newspaper analyst for Merrill Lynch and a presenter at Kent State University.

Fine broke down the historic revenues of newspapers. Across the industry, the money people paid to subscribe accounted for, on average, about 20 percent of a newspaper's revenue. Classifieds, on the other hand, typically brought in 50 percent of the revenue, and 70 percent of profits on average, according to Fine.

So let's reflect on that: The consumer was only paying about one-fifth the cost of the product. But what were they getting for that money?

Again, the mistaken notion here is that the primary product of the newspaper is journalism. That's the conceit of journalists, but it's also the general misinterpretation by those seeking to re-invent news from the outside.

The Consumer View

Let's look at a newspaper not from the newsroom-centric view, which assumes the whole value is the journalism. Let's look at the newspaper from the eyes of the consumer.

From that view, a newspaper is a product that, at least at its peak, provided about 50 different services for people. It helped people figure out where to shop. It delivered a boatload of coupons every Sunday. It helped them plan their weekend. It entertained them with comics and puzzles. It let them know what was on the school lunch menu. And along the way, it also delivered journalism.

Anyone who has worked at a newspaper long enough will tell you that what provokes more outrage from readers than anything else is messing with the comics or puzzles.

Just this week, I was eating lunch with a chief executive who had been in Silicon Valley for 30 years. Toward the end of our lunch, he said he had read the print version of my newspaper for 30 years, and still does. But he was frustrated that we now run the puzzles on a different page every day. He's not alone. About two years ago, when my newspaper all but eliminated the features section, the outpouring of emails from readers were primarily expressing outrage that the puzzles and comics were being moved.

You can shake your head, but that's as important a part of the newspaper for many people as the journalism is. For their monthly bill, which only represented 20 percent of revenue, consumers were getting a product that did many things, only one of which was the journalism. Did journalism have a higher social value? Certainly. But it wasn't the core of the business. For the reader, an ad telling them about a sale or a new store might be just as important in their lives.

Losing the Community Marketplace

So if journalism isn't the business of a newspaper, what is?

Pull back the lens. At their peak, local newspapers did two things: They created community. And they provided the local marketplace for goods and services. These services were so profitable, that they subsidized the civic good of journalism.

The reason newspapers are in trouble today is because they have lost their dominant position on both of these fronts. Classifieds have evaporated, blowing a massive hole in newspaper revenue.

People know this, yet they somehow forget that this was a completely non-journalistic function.

When it came to community, the sum of news and information in a newspaper created a shared base of knowledge, set the conversations about civic life, and provided a bond that created a sense of place. Today, as newspapers have shrunk, and as the audience has splintered, the newspaper no longer serves as community hub.

Having lost all of these things, all that is left is the journalism. And on its own, we're discovering this is not something people will pay for.

Getting Beyond Paid Content

So the solution that's carrying the day is to start charging for content. I don't favor this approach, but I think it's too late to stop the train. If paid content succeeds, local newspapers wouldn't be getting people to pay for journalism again. They'd be getting them to pay for the first time.

Once the paid content strategy comes and goes, it'll be time to look for other solutions. I don't believe, as some have written, that we've tried everything and should simply give up. In my view, there is still enormous opportunity to create business models that support local newsrooms if journalism entrepreneurs ask the right questions:

Let's stop asking how to get people to pay for content, because they never did.

Let's stop asking: How do we reinvent journalism? Opportunity abounds here. The new digital tools are allowing us to create deeper, richer journalism than ever. And more people than ever are reading my journalism. Journalism is doing fine.

Instead, newsrooms need to ask:

> How do we reinvent local community on the web?

> And how do we reinvent the local marketplace online?

By no means are these puzzles solved. I don't believe that Craigslist represents the last, best way people in a community will buy and sell things. Yelp, while growing in traffic, continues to have reputation issues with local merchants.

The discussion over paid content and tweaking the advertising model is too limited. Solve those two bigger challenges of community and the local marketplace, and you'll create a business that will support smart, multi-platform newsrooms. These newsrooms won't be dominant, as they were in the past. They'll exist as part of local news ecosystem.

But create community, help people succeed in business, and you'll find a way back to re-igniting the passion for a local news organization.

This is an important exercise because, as many of us were reminded in the re-imagined "Battlestar Galactica" series, "All of this has happened before, and all of this will happen again." Or if you prefer the non-geeky version: "Those who cannot remember the past are condemned to repeat it," as George Satayana said. If we can learn from what didn't work so well yesterday, perhaps we can collectively use that knowledge to help make things better tomorrow.

This is all the more important in the current economic climate, as even the smallest vulnerabilities of businesses are magnified -- sometimes fatally so. And just to be clear, while I work in newspapers now, I'm not talking only about them. This is true of many, many industries, most notably even relative newcomers with highly technical, highly intelligent employees. As just one example, when I worked at AOL, I saw many of the same group behaviors that I see in newspapers today.

The other night I started to explore this on Twitter with the question. "Why is it so hard for old companies with existing customers to change quickly?" People replied to me with additional ideas, and together we built the list below. But don't let it stop there. If you can think of other ideas please post them in a comment below. (Note: One thing we discovered in the Twitter conversation is that it's easy for this to turn into a gripe session about specific situations or industries, and the symptoms they show. There's no end of blog posts about that and they're not that helpful. Here, let's try to get to the root causes that apply to any mature business.)

With that, here's our short list...

Innovation Killers

1. FEAR: Too much money can be the enemy of progress.

This is perhaps the biggest irony of all, so I list it first. How can too much money keep you from innovating? It's because of a phenomenon that someone named Siddhartha Gautama -- otherwise known as Buddha -- explained a long time ago. It's because you're attached to it. That kills innovation because you're focused on keeping what you have rather than serving your customers' changing needs.

In general, successful companies are either too afraid to stop making money the old way or they're not allowed to. This is true even when a pool of money is decreasing. On the flip side, I have noticed that once revenue drops past a magical percentage, it triggers a panic which can result in a flurry of last-minute innovation -- but that's not a plan for success.

It's even worse for publicly traded companies. The shareholders they really work for, whom they have almost no control over, are often even more afraid. Or worse, they can't agree on a course of action -- with half of the shareholders punishing a stock when it makes drastic changes and the other half punishing it for not changing fast enough.

But this is also true for privately owned companies. If an inspired leader sees a storm coming that will likely result in a 30% drop in long-term revenues and tells the board of directors that it needs to proactively cut current profits 20% while it focuses on emerging business opportunities, what happens? That leader is most likely fired and nobody wins. A few years later, the company is still down 30% or more, but in this case without any game plan whatsoever.

I once, probably foolishly, told one of the leaders of a company I worked for that she would one day have to eat her own children to compete with free advertising. She looked at me like I was crazy, but this is basically what I was talking about. Sometimes you have to kill a large portion of your current business to preserve your future. Very few newspapers -- let alone many established companies -- have done that, and now they're paying the price of inaction.

2. BRAND ADDICTION: Companies are addicted to their current products and brands.

I'm surprised at how many businesses act as if their job is to protect a current brand from change, as if the brand itself is the customer as opposed to the audience. This blinds them to their customers, who are usually the ones driving the rapid change.

The good news is that we're finally seeing some movement with newspapers. More and more are creating new brands that go after audiences that didn't read the newspaper anyway, or extending their brands to audiences like Facebook and Twitter. But think of how much further along they'd be if they had started four years ago? (Side note: At the Bakersfield Californian, where I currently work, new brands have increased our audience by 100,000 individuals in a city of only 330,000. This can work, but it takes time.)

The bad news is that many still think that creating separate brands means they're killing or competing with existing brands. I'm reminded of this every time I see a niche brand that is "Brought to you by" a newspaper. This mindset only makes sense if your goal is to better serve an existing audience, but it's usually a bad idea if you're trying to grow your audience. It's the vestige of protectionism, and you can only hope that the new audience isn't turned off by the marketing tag.

Just to be clear, I'm not opposed to building and growing existing brands, but in today's fragmented world I think that "one size fits all" brands have limited appeal. My advice to mature information companies is to think of their brands as "wrappers" for capabilities and expertise. They deliver solutions to customers. But every audience prefers different packaging, so if you use the same brand for everything you end up polluting their potential.

3. PARANOIA: Companies assume everyone is their competitor, as opposed to potential partners or members.

This is something that affects business people of all types, including sole proprietors. The other day I was talking to a friend who was starting a technology consulting business in a tourist town. I gave her the name of someone else I know there who could help her out. A cloud passed over her face, and she told me, "Oh -- I don't want to talk to someone who's in the same business because they may compete with me."

If you multiply that mindset by a few hundred or thousand, you can see how paranoia can be ubiquitous in many large companies. But in my opinion, the entire premise of this argument is disproven by the open source movement, which shows that sharing leads to more opportunities and lower costs for everyone.

A corollary to this is that information businesses in particular never talk openly about their problems. This makes absolutely no sense because, in my experience, everyone will eventually find out if your traditional business model isn't working. Your current customers are also most likely to want you to succeed, and they may even be able to help you out if you're more honest about challenges up front.

4. BUSINESS BLINDNESS: Most innovation is on the consumer side, but not with the business model.

Finally, the biggest hindrance of all is that core business models don't fundamentally change until it's too late -- and that's a huge problem. You can innovate your ears out on the consumer side, but if you can't eventually grow revenue to pay for that it doesn't matter.

I was reminded of this three years ago when former Knight-Ridder exec Brian Monroe addressed winners of the Knight-Batten Awards. I wrote about his chilling words then, but I'll repeat them here for emphasis.

He told us about how the Knight Ridder newspaper chain -- which has since been sold -- was a pioneer in using digital technology to better inform citizens, "but that wasn't enough. In the end, our shareholders didn't believe in our ability to be relevant in the future. They placed more value in our assets when sold than they did in our future potential."

He said that everyone needed to innovate even more quickly or history would repeat itself and more newspapers and news providers would go out of business. He was right. Lots of innovation has happened, but it hasn't been enough. As a result, people in places like Ann Arbor, Mich., have no daily newspaper.

Power of Fear and Attachment

How is it possible that this could happen when there was so much warning? I think the answer is clear in #1 above: the paralyzing power of fear and attachment. But it also comes down to how businesspeople are motivated and compensated. If you feed your children based on a percentage of sales, are you going to do anything to upset the department store that makes up 20% of your salary? Probably not -- until it's too late and two department stores merge or one goes out of business.

To summarize, innovation is hampered by fear, brand addiction, paranoia, and insufficient focus on the business. What else? Post your ideas here. If we can make a good list, maybe some people who can make a difference will read it and help break the cycle of mediocrity.

They should get over it. But they and their gifted-amateur and part-timer peers -- especially the ones capturing breaking news events -- should start agitating for some better marketplaces than the ones available today. More on that below, but first some background:

The marketplace for photography in the Internet era has changed irrevocably. In 2006, I argued that the professionals who will feel the pain most in the short run are the folks who shoot spot-news pictures. I said, in part:

They can't possibly compete in the media-sphere of the future. We're entering a world of ubiquitous media creation and access. When the tools of creation and access are so profoundly democratized, and when updated business models connect the best creators with potential customers, many if not most of the pros will fight a losing battle to save their careers.

This was bad news for them, I acknowledged, but not for the rest of us -- because someone with a camera (probably part of a phone) almost always would be in a position to capture relevant still photos and/or, increasingly, videos of newsworthy events. We'd have more valuable pictures, not less, and production values would take second place to authenticity and timeliness.

I also said that staff feature photographers were in less trouble. The Time cover suggests that I was premature in that assessment, though I do believe that great artists will always have a market for their work.

The rub, as anyone who spends any serious time on Flickr already knows, is that amateur photographers are doing incredible work. Few of them can match the consistent quality of what the pros do, but they don't have to. Every one of us is capable of capturing one supremely memorable image. Whatever you're looking for, you can find it on Flickr or other photo sites including the stock-photos service where Robert Lam listed the picture that ended up on Time's cover. Lam said that he was paid $30 for the photo, according to this conversation thread on the Model Mayhem photo community site, which includes some strenuous objections from pro photographers.

It does strike me as absurd that a huge magazine with huge circulation can get an image like Lam's for so little money. But that was his choice, and it was Time's choice to take advantage of the low price he was asking.

Just as some people gladly take the New York Times' absurdly low pay when their freelance articles make it into the paper's news and op-ed pages, some photographers gladly sell their work for peanuts to Time. They have their own reasons, which can range from getting valuable exposure -- so they can (try to) charge more for subsequent work -- to not needing the money staffers and more famous people can demand.

This gets trickier, it seems to me, when it comes to breaking news, where news organizations derive enormous benefits from having the right image or video at the right time and too frequently get it for less than peanuts. Indeed, practically every news organization now invites its audience to submit pictures and videos, in return for which the submitters typically get zip.

Which is why we need a more robust marketplace than any I've seen so far -- namely a real-time auction system.

The sites currently promoting citizen journalists' work don't offer anything of this sort, as far as I can tell. This isn't to say I don't like those sites, which include NowPublic and Demotix, because I like them a great deal. But someone needs to go further.

How would a real-time auction system work? The flow, I'd imagine, would go like this:

Photographer captures breaking news event on video or audio, and posts the work to the auction site. Potential buyers, especially media companies, get to see watermarked thumbnails and then start bidding. A time limit is enforced in each case. The winning bid goes to the journalist, minus a cut to the auction service.

The premium, then, would be on timeliness and authenticity. One or two images/videos would be likely to command relatively high prices, and everything else would be worth considerably less.

Eventually, someone will do this kind of business -- which could also be useful for eyewitness text accounts of events. For the sake of the citizen journalists who are not getting what they deserve for their work, I hope it's sooner rather than later.

(Cross-posted from Mediactive)

For more on Demotix and citizen photo agencies, check out this article from MediaShift by Mark Glaser.

Public Radio Player, the new version of the old Public Radio Tuner, is a free application that allows users to access more than 300 radio stations across the country. With a few swipes to the screen of an iPhone or iPod Touch, users can listen to live shows or recorded podcasts from locations of their choice. The app is a collaboration led by Public Radio Exchange (PRX), with National Public Radio, American Public Media, Public Interactive and Public Radio International, and funded by the Corporation for Public Broadcasting.

With 1.8 million downloads to date (including Public Radio Tuner, the previous version), the app has given thousands of listeners access to stations and favorite shows -- like Marketplace, Prairie Home Companion and This American Life -- without the geographical limitations of a radio signal.

Relationship between listeners and stations

But while increasing listeners, the app has initiated a conversation about funding for public radio stations and the responsibility of listeners to their local station. In his piece on PaidContent, Rafat Ali wrote, "All of this adds to the issues surrounding local public radio funding in the digital age: If a large number of iPhone app users are not necessarily listening in to the local station, then loyalties start to shift, or even fade away, which in turn affects donations to the local stations."

Jake Shapiro, founder and executive director of PRX, told me that he's not surprised by the controversy. "I think there are definitely some things that this kind of application will provoke," he said. "It does stretch the relationship between listeners and their stations."

But eventually, he would like the app to evolve into something that supports public radio in a different way.

"Our hope and belief is that it expands and grows the total audience for public radio," he said. "Although there's a big question of how to translate that functionality into something that is convenient at the producer and station level."

Ideally, Shapiro would like users to donate directly to the radio stations from their iPhone. With a simple click, a listener in Chicago could see that she was a frequent listener of WCPN in Cleveland, and donate to that station using the credit card stored on her iTunes account. But because Apple currently doesn't allow iTunes to be used for charitable purposes, this isn't an option.

"It's true there isn't much incentive for Apple to solve this," said Shapiro. "But we're hoping there's at least a moral case for how Apple should be involved."

And even if Apple did begin to allow for charitable donations, there is still the stipulation that only paid apps are allowed to have in-app transactions. Although PRX considered charging, they wanted to make the app available to the broadest possible audience. And they also didn't like the idea of Apple taking 30 percent of all payments.

Other ways to connect

Google's Android platform may also offer an easier way to connect users with their stations, said Shapiro. "You'd have the freedom to map however you wanted to do transactions, but not the seamless experience of Apple's ecosystem," he said. Although PRX is not actively working on an Android version, Shapiro said that there has been both discussion and demand. PRX is also working with Doc Searls, a fellow at Harvard's Berkman Center for Internet and Society, to develop a way to log user listening patterns and then encourage them to donate to their favorite stations.

And when it comes down to it, listener support is just one of several revenue sources -- taxes, corporate underwriting, philanthropy -- that keep public radio alive. If, at some point in the future, Public Radio Tuner would be able to change the landscape of public radio, Shapiro hopes that it will be for the better. Listeners might not want that free tote bag with the name of their local station, but by increasing public radio's audience and eventually letting people know what stations they're listening to, Public Radio Tuner will not only keep public radio alive, but help it to thrive.

The recap

The conversation began when Katz asked a question about fundraising for Spot.Us, which allows readers to donate to fund individual journalism projects that they would like to see completed:

The basic fundraising model is this: the donor supports not the organization, but the project sponsored by the organization...The question, I think, is whether and how folks will shift their loyalty from the project to the organization (there's a second question, too, which is whether this deeper level of donor loyalty matters for Spot.Us-like organizations -- maybe I'll have to go have a conversation with Dave about this, huh?

That question sparked the start of the more formal conversation between Katz and I, as he laid out some questions about Spot.Us's approach and status. I thought I'd have some fun, so I responded with a video post, in which I talked about Spot.Us's core values of transparency, immediacy, and control (for the donor, that is). I also asked Katz some questions about whether or not Spot.Us is being naive in its fundraising model or if it can learn a thing or two from how Mother Jones raises money.

Katz responded:

So it's not donor choice per se where Spot.us is innovating. As Dave notes, it's the possibility that interested community members connect with reporters on stories and issues they care about. Not only does that increase the possibility that people will actually pay for stuff they want, but it makes the reporting process more transparent (this was what made Chris Albritton's Back to Iraqso damned exciting back then).

Adding Transparency to Funding

Katz actually brought something to light for me. I often say that "donating to journalism isn't new -- it is just having control over where your money goes that makes Spot.Us interesting." In fact, I use NPR as an example all the time. They could blow me out of the water tomorrow by adding transparency to where donations go (and I would be
totally fine if NPR did adopt community-funded reporting).

Katz points out that what community-funded reporting represents isn't just participation through donating -- it brings a new level of transparency to journalism.

Increasingly, Spot.Us does reporter debriefs either mid-way through or at the end of an article. We use BlogTalkRadio right now and we invite donors to get on the phone and chat with the reporter about what they are learning and digging up. There is an added service in here. The community in "community-funded reporting" can get involved and this, as Katz notes, makes the reporting more transparent and accountable.

People often say that reporting for an ethnic newspaper is much more difficult than a large metro because the reporter is part of the community they are reporting on. They are more accountable. I'd say the same goes for a community-funded reporter. In fact, I've been told as much. One reporter even printed out the list of donors and tacked it to their bulletin board as a reminder that he was responsible to a list of engaged citizens. The big step Spot.Us is taking, according to Katz, isn't one of giving donors transparency, but it's making the reporting itself more transparent.

That sounds beautiful in a blog post, but as noted (and Katz concurs) it might be part of the reason why it is hard to get other news organizations to adopt the Spot.Us model. They have to be ready to put themselves out there in the open from day one. I have a million reasons why it's a good idea to be transparent -- but I'll save my "pitch" for
another blog post.

Let's table that -- but keep it in the back of our minds, because I'll come back to it: "It's hard to get news organizations to jump on board because of a cultural shift."

Traffic Measures Impact

Katz and I also discuss traffic. I still try and avoid traffic as a measure of success, but Katz is right in pointing out that it isn't just a metric of success, it also measures impact. Impact is something that donors want.

A good example: A recent Spot.Us story we did with AllVoices has a nice "number of views" metric. I can see that as of writing this blog post that the video has received almost 5,000 views. That is a boon to donors; they want to know that the story they support is seen by others. When Spot.Us did a story with the Oakland Tribune, fundraising was easier because people knew the editorial would be tight and that the finished story would get distribution.

Raising traffic, however, is a beast in itself and one I don't want to get locked into. Growing traffic can be self-defeating and I know from my Digg days how ugly and distracting it can be. I want to focus on making good journalism happen.

That's why Spot.Us is also a platform that is designed to engage with partnering news organizations like Mother Jones, the Center for Investigative Reporting, the San Francisco Chronicle and others (The new Pocantico Watchdogs have me salivating).

In truth this goes back to Jeff Jarvis saying "Do what you do best and link to the rest." It goes for covering topics on the web but I also think it needs to be applied in
how we run Spot.Us.

What we do best

• Create tools for fundraising of journalism projects via community-funded reporting.
• Do our own outreach on behalf of journalism projects.
• Create a sense of community around journalism projects and expose the sausage-making to those who are interested.

What news organizations do best:

• The editorial for journalism projects.
• The distribution of journalism projects.
• Spread word within their own communities about how to get engaged.

I think some start-ups try to recreate the entire media sphere. That's a mistake -- one that Spot.Us has been pushed into from time to time (and will probably happen again) whenever we don't have a partnering organization to share the load. Hence the irony of the situation above: What we do best requires a cultural shift and that's why we are slow to find partnering news organizations even though actually partnering with us is as quick as clicking a button.

Katz suggests hiring somebody who can manage our relationships with other news organizations. I wouldn't be against another hire at all but we probably won't be able to for budgetary reasons.

Instead I want to build out the platform so that these partnerships can be more lightweight. Right now, it is confusing for news organizations to know all the different ways they can partner with us. Increasingly that is a part of the business development plan that we are working on that I think will be crucial.

News Org or Platform?

It still goes back to the question: Are we a news organization or a platform?

I think we have to be a bit of both, but without falling into the trap described earlier of trying to recreate the entire media sphere. So what parts of Spot.Us are a news organization and what parts are a platform serving news organizations as a main customer?

That is something we are still figuring out. It is where we start to look a bit more like a non-profit version of mediabistro. It's a community for reporters and news organizations to meet and work together -- but they are doing so in public and that way we can bring community funding into the mix.

As for Katz's advice on traditional fundraising: A spaghetti dinner is on the way. We don't have all the details yet but folks who donated to the City Budget Watchdog pitch are invited to a meetup on July 13 at the Grotto where we will talk about the reporting we've done so far and what is to come next. Afterward we will meander to 21st Amendment (details to come).

And now -- back to Katz: In my first response I asked if there was something naive about the Spot.Us model. It seems that it isn't naive -- just a little "out there" still.

But Mother Jones as an organization is already somewhat "out there." You have been pushing the boundaries of running a non-profit news organization for some time. Politics aside -- nobody can knock what you have all accomplished.

But when life is hard you have to change. And times are tough. Even the New York Times is re-thinking itself. So my question is: How does Mother Jones, a much larger organization than Spot.Us, approach all this? Are there plans being plotted? Moves being considered? Are things pushing on as usual? What is on your radar that I'm not aware of?

They don't want your pity. They're seeking your respect -- and your helpful answers to some of their questions about the future.

Journalists under siege

For sure, professional reporters are not saints deserving of hero-worship. But they don't deserve to be dubbed a closed priesthood interested only in preaching to the masses and keeping lay-people out of the profession. That's an unfair and highly caricatured criticism.

The point is that, even despite the many sins of the profession, journalists have sustained a form of public communication crucial for a level of democracy in countless countries -- and the underlying industry still has a long run for underpinning this in the developing world.

For too many journalists around the world today, the biggest threats are still governments, soldiers and crooks (sometimes one and the same entity). But everyone also knows that increasing numbers of journalists are also threatened by changes in media economics -- especially in the press in developed countries.

It should be of universal concern that the extant business model of newspapers is declining so fast in some places and is far from future-proofed in other countries. If there's no newspaper industry ahead, from where is society's journalism (warts 'n all) supposed to come?

Reports of Journalism's death greatly exaggerated

To the extent that people point to broadcast journalism, or to publicly subsidized media, it's correct to say that a demise of newspapering is not equivalent to the end of journalism.

"A world without birds" was the subtext of the avian flu panic; "a world without journalism" is a similar hype right now.

On the other hand, it is definitely the case that without newspaper companies, there's the serious prospect of a global shrinkage in journalism -- and that's a loss that can't be made up for by all the world's citizen bloggers, NGOs and live-streamed coverage of municipal meetings, etc. (as valuable as these are).

Despite this truth, wherever there are online articles (emanating from journalism) about the troubles in the newspaper industry, there are also too often also worrying comments bidding good riddance to the press. Never mind that the platform for expressing these views often wouldn't even exist if it weren't for the money made, ultimately, from institutions built upon professional journalism.

Fortunately, notwithstanding all the changes in journalism, the people with stakes in newspapers are not going to roll over and die. Nor, contrary to some claims, does their newfound zeal for experimenting with paid content models amount to a collective suicide pact.

Instead, there's a lot of idealism that's actively committing energy to keeping media-based journalism thriving.

Standing up for newspapers

There are also the directly vested interests of those who own, operate and work for media houses. And amongst these, a critical set of interests concerns those of the journalists themselves, and their representative organizations -- their trade unions.

This is a constituency that's fighting back -- not, generally, to hold onto the past, but to ensure that their voices will help shape the future of journalism.

And they want your views to help them do so. To this end, the International Federation of Journalists has this week posted some 25 questions on their website. These emanate from a group that's developing a report on the "future of journalism" for the organization's 2010 congress.

Far from a siege mentality, journalists under economic threat today are showing an openness to ideas -- and to collaborations with bloggers, foundations and general well-wishers.

Perhaps the pundits, managers, consultants -- and critics -- could pause a moment to respond to this approach from those working at the coalface.

Guy Berger is co-chair of the IFJ's "Future Group" think tank, a group of ten journalism union leaders and academics from Canada, the UK, Australia, Brazil, Spain and Indonesia.