Today, most news organisations are adjusting to the fact that the internet has toppled the distribution models that once supported them in style. Seduced by the billions that Google and others have made off free, ad-supported services, they’ve convinced themselves that online advertising is the future and thus they should focus on building the widest possible audience. Subscription offerings, in many cases, were an afterthought. The Information is founded on the opposite principle. We believe the best way to build a brand is to be indispensable to some people, rather than try to appeal to everyone. The business model aligned with that mission is a subscription business where our only incentive is to write articles our customers want so badly they are willing to pay for them.
A key criterion to measure the success of media in transition is whether it can sustain commercial growth while benefiting society. Compared to other enterprises, which make commercial interests the top consideration, media organizations should care more about their responsibility to social and public interests. Traditional media should realize the challenges ahead. Companies should be prepared to face declining demand for print publications, sales and distribution, and adjust their personnel structure accordingly. The transition of mass media into the digital age will lead to significant changes in advertising. Ads in newspapers and magazines will see a dramatic decline, but at the same time the rise of Internet-based news portals will provide more diverse platforms and formats for advertising.
Map of business models for online journalism startups, from Chasing Sustainability on the Net, by Esa Sirkkunen, Clare Cook, Pekka Pekkala, Mikihito Tanaka, Johanna Vehkoo, Nicola Bruno, and Luchino Sivori.
In our findings the business models of the cases fall into two main categories: those which have storytelling-orientated business models and those which rely on a more service-orientated model.
The sites whose business model is based around storytelling are still prevalent in our findings. These sites focus on making money from producing original content, news and stories, for audiences. The difference to the mass media model is that in the online world the target audience is smaller. Online journalism relies heavily on niche audiences built around targeted themes such as hobbies, neighborhoods or psychographic tendencies. In this niche journalism there is a tight triangulation between journalistic content and advertised products.
The other group, service-oriented business models, seems to be growing. This group consists of sites that don’t try to monetize the journalistic content as such. For example citizen journalism sites are more like platforms that curate and moderate citizen-oriented content, or news aggregators compile stories form other outlets. Some startups have specialized in selling technology, information, training or diversifying to redefine what it means to do news.