Ah, 1950s-vintage newspaper presses. Will someday the journalism business model be looked back at with as much nostalgia? (Image from the Chicago Postcard Museum.)
Everybody seems to be jumping on board the latest save-all-newspapers idea, which is to take them private and raise money as a charitable foundation so that they can live off a beefy endowment.
I can’t remember where I first heard the idea, but I do know that the St. Petersburg (Fla.) Times works on exactly that model, being funded by the non-profit Poynter Institute.
Now, it’s being pitched in the pages of the New York Times:
How large an endowment would a newspaper need? The news-gathering operations at The New York Times cost a little more than $200 million a year. Assuming some additional outlay for overhead, it would require an endowment of approximately $5 billion (assuming a 5 percent annual payout rate). Newspapers with smaller newsrooms would require smaller endowments.
Yikes! But not an impossible amount, I suppose. There’s a similar argument being made in the New Yorker, too, regarding specifically the Washington Post, with smaller (but still huge) numbers. Even snarky Gawker is on board.
I worry that this NPR-style business model would lead to newspaper pledge drives with crappy merchandise, but the flip side of that is perhaps your subscription could be written off?
Like endowed universities, which still charge tuition fees, non-profit newspapers might be able to earn money from other areas, but it seems like they would have to drop the advertising once and for all. I’ve argued before that, for readers, advertising is valued content, but I’m not sure how an ad-sales paper meshes with a public-service endowment paper.
Thoughts?
Grant Hamilton
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