Thursday, June 2, 2011

News organizations have attracted $187 million in grants since 2005

The new ecosystem of small news organizations continues to evolve at breathtaking speed. When you consider that it has been only four years since the news industry’s business model went into free fall, the number of new organizations and their quality are impressive. 

Also impressive is the financial support that they have attracted. J-Lab has just updated its database of grant activity to news projects since 2005, and the totals are: 

  • $186 million 
  •  from 274 foundations
  •  to 146 news projects
  •  775 grants
  •  23 states

To some degree, this report provides an answer to the question of who will provide the public service and investigative journalism now that traditional news organizations are cutting back. These mostly digital news organizations are doing precisely that, some with a geographic focus, others with a topical one (health, education, ethnic groups).

More than a drop in the bucket

Skeptics might say that this figure of $186 million over six years needs to be put into perspective: it represents less than one year’s revenues of a mid-sized metropolitan newspaper, the Baltimore Sun, in its heyday. They would argue that it is a drop in the bucket. 

However, it is wrongheaded to compare a capital-intensive monopoly media business with an ecosystem of dispersed digital media organizations. The new media are different, with extremely low costs of distribution and production. Virtually all the cost now is in the ideas and the people who produce them. 

A look at the funding models used by some of these organizations is a combination of grants, memberships of various levels (think subscriptions), advertising, special events, sales of data, sales of related services (consulting on digital media and marketing) and direct sale of products, among other things. 

The funding model for National Public Radio has been invoked a number of times as the way to go for digital media, but I think it might also look like the model for a symphony, ballet or theater organization, with ticket sales (memberships) along with grants and fund-raisers. 

Who is giving

Thirty-three of the grants listed in the database were for $1 million or more. A perusal of the grant-makers shows that community foundations are stepping up to fill the gaps in support for public service journalism in, among other places, Buffalo, Richmond, Alabama, San Diego, Kansas City, Hartford, Manatee (Fla.), Madison (Wis.), San Antonio, Denver, Minneapolis, Oregon, San Francisco and New York City.

News entrepreneurs who are looking for grant funding should scan the list of 274 contributors for prospects. In addition to well-known names such as the Ford Foundation, Carnegie Foundation, Open Society Institute and John S. and James L. Knight Foundation, there were 30 grants totaling $2.5 million from the Ethics and Excellence in Journalism Foundation of Oklahoma City. That one might not be on your list. 

Spotlight on 60 news organizations

Charles Lewis, professor at American University and executive editor of the Investigative Reporting Workshop, has compiled a database of 60 news organizations that he describes as making up the new media ecosystem focused on serious public service and investigative journalism. 

He notes that these organizations employ 443 people with previous journalism experience, which does not begin to offset the 20,000 editorial jobs lost in newspapers since 1992. 

But from my perspective, it is an encouraging start. We are still in the early stages of the transformation of the model for public service journalism. Far from being discouraged by the numbers, I am impressed with the speed of the transformation thus far. 

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