Study indicates most local news startups make less than $50K per year
If you read this article back in 2011 — headlined “How Entrepreneurial Journalism Will Change Our World” — you’d be forgiven if you assumed that by now, in 2015, the journalism world might have evolved into a much more lucrative place.
After all, the concept of entrepreneurial journalism has been all the rage lately. Years of layoffs, cuts, and shrinking revenue at traditional media outlets made sure of that.
And make no mistake, there have been several successful examples of entrepreneurial journalism: FiveThirtyEight’s Nate Silver (formerly of The New York Times), Re/code’s Kara Swisher (formerly of The Wall Street Journal), Vox’s Ezra Klein (formerly of the Washington Post), and The Intercept’s Glenn Greenwald (formerly of The Guardian), to name a few.
But those are all national (or international) examples propelled by journalists with national (or international) fame. What about the rest of them?
Well, whether most scribes-turned-bosses are any better off now than at their former jobs is another story, thanks to a report released this week by the Tow-Knight Center of Entrepreneurial Journalism.
Most online local news sites — nearly 80 per cent of those established within the past five years — make less than $50K per year, with two-thirds pulling in less than $100K per year, according to the report.
It added that only nine per cent of these sites make more than $500K per year, while pointing out that most haven’t been able to secure new revenue streams.
It’s a cold, hard reality for journalists who have jumped into the business side of… well, the business — especially since these sites are “often founded by journalists who have no business or sales experience.”
“(Most) remain quite small both in revenue and reach and remain highly dependent on local display advertising,” the report said. “What stands out from the survey is that most… are tiny and potentially vulnerable because they rely heavily on a single revenue source — advertising.
“At the same time, many are also dependent on volunteers for content and a significant number of the publishers are not yet paying themselves.”
But it’s not all bad: 70 per cent of respondents said their year-over-year revenue went up in 2014, with nearly 20 per cent reporting a near doubling in revenues.
Some other key findings from the study:
- Of sites established in 2010 or earlier, 33 per cent reported annual revenues of $50K or less (compared to 79 per cent of those established in 2011 or later);
- 72 per cent named local advertising as their primary source of revenue;
- 32 per cent said they have partnerships with other organizations or institutions;
- 17 per cent rely exclusively on journalists as their primary content source, with the rest indicating community members, students, and partners help to fill the gap.
The survey, conducted between February 28 and April 29 of this year, included 80 publishers representing 94 news sites.