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Charting a locally owned, for-profit future for community news

Nonprofits are great, but a replicable, sustainable model for making money in local news online is the holy grail. In upstate New York, The Batavian is showing the way.

For those of a certain age, perusing the ads posted at The Batavian, the for-profit news site in Batavia, New York, can seem a lot like flipping through the pages of a weekly community newspaper a generation or two ago.

batavian-adsWhich is to say there are a lot of ads — more than 140, every single one of them on the home page, a practice that publisher Howard Owens believes is more effective than rotating them in and out. There are ads for funeral homes and pizza shops. For accountants and tattoo parlors. For auto repair centers and ice cream stands. For bars and baseball (the minor-league Batavia Muckdogs).

The success of The Batavian matters to the future of local journalism. In my book The Wired City: Reimagining Journalism and Civic Life in the Post-Newspaper Age, I devote most of my attention to the New Haven Independent, a nonprofit site that subsists on grant money, donations, and sponsorships. At this early stage of online news, nonprofits like the Independent are often able to raise more money more quickly than for-profits. But not every community can support a nonprofit. Thus it is vital for the future of news that entrepreneurs like Owens figure out the for-profit side — which is why I also devote a fair amount of space in The Wired City to what’s going on in Batavia.

Owens launched The Batavian in 2008 as a demonstration project for GateHouse Media, where he was the director of digital publishing. When his position was eliminated in early 2009, he asked GateHouse if he could take the fledgling site with him. He was granted his wish.

The Batavian is free and covers not just the city of Batavia (population 15,000) but surrounding Genesee County (60,000) as well. It receives about 80,000 unique visitors per month, according to Quantcast. That’s roughly the same as the site’s newspaper competition, The Daily News, also based in Batavia. (Web analytics are imprecise, and Owens says his internal count, provided by Google Analytics, shows about 118,000 uniques per month.) Of course, The Daily, as the locals call it, depends mainly on print distribution. On the other hand, The Batavian covers just one county to The Daily’s three, making Owens’ online reach all the more impressive.

The Batavian’s 12-month projected revenues are currently about $180,000 a year — enough to provide Owens and his wife, Billie Owens, the site’s part-time editor, with a comfortable living, and to employ a part-time sales and marketing coordinator. Unlike AOL, with its struggling network of Patch sites, The Batavian is independent, and Owens aims to keep it that way. As the Authentically Local project, of which The Batavian is a part, puts it: “Local doesn’t scale.”

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Howard Owens at work in 2009. Photo by Dan Kennedy.

If a nonprofit like the New Haven Independent can raise more money than a for-profit (indeed, Independent founder and editor Paul Bass chose the nonprofit route in 2005 because he realized he couldn’t support himself with a for-profit), there are nevertheless certain advantages to for-profit online journalism. Let me outline three of the more obvious.

Anyone can start a for-profit news site.

The nonprofit route requires approval from the IRS and support from local foundations. In many cases, neither may be forthcoming — and as I recently wrote, the IRS has all but halted approval of 501(c)(3) status for nonprofit news sites, which they depend on so that donors can make tax-free contributions. By contrast, all it takes to launch a for-profit site is talent, experience, and a willingness to work hard. That’s no guarantee of success, but the opportunity is there for all.

Local ads enhance the vibrancy of a site.

Owens likes to say that advertising is content. The ads at The Batavian give you a good feel for Genesee County — and provide a context for Owens’ coverage of everything from court news to traffic accidents, from school events to development proposals. Advertising and news work together to provide a well-rounded picture of the community. Yet you won’t see ads at a nonprofit site like the Independent, save for a few image-building “sponsorships” from local institutions such as college and hospitals.

For-profit sites enjoy the full protection of the First Amendment.

Like public radio and television stations, but unlike the vast majority of newspapers, nonprofit news sites are legally prohibited from endorsing candidates for public office. “Editorial endorsements — or the denial of them — are among the most powerful tools that newspapers have for holding political figures to account,” write the media scholar Robert McChesney and the journalist John Nichols in their 2010 book The Death and Life of American Journalism: The Media Revolution that Will Begin the World Again. The Batavian hasn’t actually endorsed any candidates, but at least it’s not legally prohibited from doing so — and Owens takes strong stands on other local issues without having to worry about the federal government swooping in and threatening his livelihood.

When I visited Batavia in 2009, I rode along with Owens as he made sales calls and covered stories in Genesee County. It seemed like a hard slog. At one point, as we were driving through the tiny farm town of Stafford, he gestured to a well-manicured golf course. “If you find out that I’ve joined the Stafford Country Club,” he said, “then I’ve been successful.” Two years later, I asked him about the status of his country club aspirations. He laughed. “I’d love to join the Stafford Country Club and have time to enjoy the privileges thereof,” he said, “but we’re probably years away from doing that.”

Yet The Batavian keeps growing. Last week the site announced a new real-estate ad partnership. Recently Owens told me he now spends virtually none of his time on ad sales, having offloaded that task to his part-time employee. The Owenses are able to devote the bulk of their time to journalism — something that was not the case when I was researching The Wired City.

Owens likes to remind people that we’re at the very beginning of online news as a business, and that what appears not to add up economically today may look quite different a few years from now. As Owens asked in a provocative blog post four years ago: “If it took newspapers more than 100 years to build the business and content models that we all now cherish, why do we expect a fully formed online model to emerge in just 10 years?”

Dan Kennedy will be reading from The Wired City at Present Tense Books at 101 Washington Ave. in Batavia this Saturday, July 13, at 11 a.m. Kennedy is an assistant professor of journalism at Northeastern University and a panelist on Beat the Press, a weekly media program on WGBH-TV Boston. His blog, Media Nation, is online at dankennedy.net.

                                   
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  • Larry Grimes

    Interesting—you pen a story about the Batavian (which if they would hire an experienced digital ad sales director looks like it has some revenues promise) and they write a puff piece (sorry, pr release) on your visit and the sale of your book. Seems like a big conflict of interest to me.

  • JohnPGarrett

    Another thing to be admired about Howard (not really emphasized enough) is his hard work. The fact that he got off his rear and worked to get local advertisers to help him with his vision is something those looking to copy him should focus on. It’s not just skill. It is the vision that moves his passion and his passion is displayed in his work ethic. Too many people think if you build it they will come. You have to build it and drag people along. Kudos Howard. Well done.

  • http://www.ecape.com/ Julie Brooks

    Finally a piece with real numbers. Thanks Howard and thanks Dan.

  • http://www.berkeleyside.com/ lknobel

    As I’m sure Howard told you, The Batavian is one of hundreds of independent, for-profit sites, a good number of which are thriving, including Berkeleyside, which we started four years ago and now employs three people (one reporter, two salespersons) in addition to the three journalist founders.

    Another reason to go the for-profit route which you don’t mention, is the pride and benefit of ownership over the long term. As a non-profit, the law requires a board that is controlled by disinterested parties. As a for-profit, the owners will prosper as the site prospers and, perhaps, somewhere way down the line, we’ll reap the benefits of our sweat equity either through a dividend stream or through a sale of the business.

  • http://howardowens.com Howard Owens

    Thanks, John.

  • http://mediasavvy.com Barry Parr

    This is a really important point.

    If you want to run a community news site, you may find that a board of directors is more trouble than than nonprofit status is worth. Nonprofit boards may start out friendly and supportive, but they change over time. And they often become lazy and passive, or opinionated and meddling. Or both of those things at once.

  • Andrew Long

    Nonprofits are not always about news replacement. When done properly, and according to the IRS definition, their mission should include collaboration, education and public service. You can’t compare them to for-profit community news sites.

  • Mark Swanson

    The money is still in printed community weekly newspapers. Why work so hard for so little money for an online presence?