To make money with news, "give away what's abundant... charge for what is scarce"

Barbara K. Iverson writes from Chicago:

The weekend of February 21-22 was a doubleheader. It wasn't the Cubs v. Sox but emotions ran high at several points. The Sunday event was the sold-out Chicago Journalism Townhall at the Hotel Allegro (formerly the smoke-filled Bismark Hotel, site of many a political intrigue).

Convened by Ken Davis, former program director at WBEZ, for "working journalists, out-of-work and under-employed journalists,citizen journalists, aspiring journalists," the 13-person panel came together to talk about "the way people consume news, and the way it’s delivered, changes almost every day."

With old economic models failing, and new ones not yet fully realized, the panelists represented quite a spectrum of opinion on the topic. I was on the Chicago-centric panel with Lee Bey, John Calloway, Thom Clark, Geoff Dougherty, Robert Feder, Ben Goldberger, Carlos Hernandez-Gomez, Andrew Huff, Alex Kotlowitz, Carol Marin, Michael Miner, Salim Muwakkil, and Eric Zorn (bios here.)

As the townhall began with standing room only, Ken Davis asked, "Is there a chance online and print will find common ground?" Before the discussion had gone very far, John Calloway, who worked in radio before television and at City News Bureau, cut to the chase by saying, "Let's assume that newspapers are dead..."

Some of highlights of the afternoon included Geoff Dougherty's assertion that one could run a newsroom with a $2 million newsroom, which garnered nods of approval from onliners as well as snorts of disbelief from old line newsies. Another statement that divided the room was an admonition directed to Ben Goldberger and other online publishers to "stop stealing content."

It was clear that for some in the room link economy was more about Oscar Meyer products than a key component of reputation ranking, social networking, and post-scarcity economics. To prepare for the panel, being an academic and early-adopter blogger, I decided to focus on two things. First, to contrast the assumptions of an economy of scarcity with those in an economy of abundance to bring up the idea that giving away content can be an effective strategy for making money. And then to identify various economic models that are being used by news organizations, large and small, and have examples of these models.

My 21st century economics in a nutshell:

Thomas Jefferson noted that an infinite or abundant resource, once created, costs nothing to give away and the original creator retains the original.

Give away what’s abundant, say information or news, to increase your market and build your reputation. Charge for what is scarce, and make money from that. For news, timeliness or in-depth coverage might be the scarce aspects.

Ken Davis stopped my list of models at five, though he has since apologized as there was a segment of the audience who wanted to hear all of them. The eight are listed below and you can read more detail if interested:

• Collaborate and syndicate
• Non-profit funding from grants and foundations
• Local pay, in an NPR-like model
• Get a patron
• Hybrid model combines features of other models
• Post news story “bids”and take reader “pledges” and donations to fund stories. If the story is picked up by a news organization, donors are repaid.
• Begin mobile or online, evolve to print
• Open source or “King Gillette” model

Toward the end of the session, two interesting interchanges took place. Eric Zorn was one of the panelists who was checking tweets on his iPhone during the session, and he asked one of the numerous twitterers to identify himself and to repeat his twitter out loud. It was interesting to see how Twitter background conversations emerge during these kind of large group sessions.

One of the final speakers was Brad Flora of Windycitizen.com, a news aggregator where users can vote news stories up or down, as well as add their own content. Flora turned the content theft accusation on its head, noting that when Windycitizen broke a story about a confrontation between a police officer and a man on the CTA, the story was picked up by the Chicago Tribune, where it ran without mentioning Windycitizen.

The Saturday session was BarCamp NewsInnovation, a sort of unconference that aimed to bring together journalism students, journalists, and programmers and technologists. About 30 folks met all day at Medill's downtown facility where organizer Jason Kristufek responded to tweeted questions about how journalists and progammers communicate with each other. "We don't have a ton of answers but we do need to come up with a basic literacy and understanding to communicate and collaborate well enough to get the best possible end result."

A snow storm kept me away from BarCamp so I didn't bring it up on Sunday, though I wrote about it as it was happening. Gordan Mayer from Community Media Workshop in Chicago noted "... how messed up and indicative of the two separate worlds of "old" media and "new" news that the Barcamp event never even got a mention Sunday afternoon..."

Barbara Iverson blogs at CurrentBuzz and ChicagoTalks
Also see: Panel dwells on the future of Chicago's journalism