Civil Beat, TBD Model How To Start a News Operation From Scratch

This month and next we are getting an up-to-the-minute answer to what has become a familiar news industry question: If you were starting a news operation from scratch, what would it look like?
The launch of Pierre Omidyar's Civil Beat early this month in Honolulu and of Allbritton Communications' TBD in June in Washington, D.C., have familiar elements from online start-ups of recent years, a marked new emphasis on community-generated content, and a key divergence on business models.
Both are online only, and thus able to reverse the traditional cost structure of a newspaper. Like MinnPost, Voice of San Diego and ProPublica, each will pour most of their budgets -- probably 65 to 85 percent -- into news. At traditional newspapers, the ratio is the reverse -- about 15 percent to news, 50 to 60 percent to production and distribution, the rest to ad sales and general management.
Both picked editors with strong mainstream experience. John Temple, who edits Civil Beat, was editor and publisher of the Rocky Mountain News for more than a decade until it closed a year ago, including new media ventures like the Rocky's Your Hub hyperlocal sites. Jim Brady, editor of TBD, edited the Washington Post's site for five years. The new venture gives him the opportunity to do a purely local site his way, absent constant friction with a stuck-in-tradition legacy newsroom. But I also see the appointments as confirmation that experienced news judgment, standards and organizational skills remain relevant to any ambitious news launch.
They pick their shots on coverage areas. Like their predecessors, the two launches are leaving breaking crime news and sports scores to others. Civil Beat begins with five areas of coverage: Honolulu, the state of Hawaii (politics and policy issues in both instances), education, land, and money. Brady's TBD, he told my colleague Steve Myers, will be a mix of the top tier of metropolitan news for the whole D.C. area, together with neighborhood-by-neighborhood hyper-local reports. For starters, Brady said, he anticipates little coverage of education or business.
They aim for some critical mass coming out of the gate. Google famously started in a Stanford seminar room, then a garage. But part of the art of the launch is to be big enough from the start to draw attention if you propose to serve a substantial city or a whole state. Civil Beat begins with a professional staff of 12 and the high-profile backing of eBay billionaire Pierre Omidyar. TBD will start with a professional staff of around 50, the deep pockets of Allbritton Communications and the prestige of its successful sister site, Politico.
Influenced, perhaps, by planning and attending Poynter's conference on user content a week ago, I'm struck by how central community-generated news and commentary are to each of the ventures. Civil Beat started the ball rolling by designating most of its new hires as "reporter-hosts." Temple mischievously told our conference in a Skype call, "we use that title so people will ask what we mean by it."
The answer was apparent when the site began posting news May 4. Every story was followed by a discussion. The subject area specialists were clearly responsible both for reporting on their respective beats and seeding and moderating a discussion that follows.
Much of the Civil Beat content is behind a pay wall and it is early to make any sweeping judgments about its quality. But the site design and its first days suggest that Temple and Omidyar have made long strides in creating that perennial favorite of foundations, a virtual civic town square.
The shape of TBD's citizen-content effort are to be determined when the site debuts. But Brady has signaled its importance by hiring veteran Steve Buttry as director of community engagement and devoting seven of the 50 professional slots to that effort.
For all their common characteristics (including being for-profit ventures), the news sites have at least one striking difference -- polar opposite business models. Civil Beat, initially, at least, is not accepting advertising, but plans to charge an eye-popping $19.95-a-month membership fee. (Omidyar is providing an unspecified amount of seed money but believes philanthropic investments should be sustainable businesses.)
Why the high fee? For one thing, members who pay that have committed in a way that increases the likelihood they will participate in the discussions. For another, the substantial fee signals "the reporter is working for the community." For a third, it suggests a shared commitment to keeping the conversations civil.
Temple was asked whether the $19.95 monthly entrance fee (with a get-acquainted introductory offer, now marked down to 99 cents for 15 days) was exclusionary and likely to yield an elite, moneyed audience. He replied that the rate was deliberately set at about the same level as a print subscription to the Honolulu Advertiser, which is in the process of merging with the rival Star-Bulletin. That suggests to me that subscribing to Civil Beat may be framed as an alternative to the newspaper, for people happy to get the rest of their news free from various websites.
One less obvious part of the Civil Beat plan, Temple added, is that it has features of the "tech-transactional culture" of eBay and PayPal. So ease of use, quick engagement and tech improvisation as a need arises will be part of the package for users. Indeed, after a glitch in our Skype call developed, Omidyar himself popped on screen re-establishing the connection at Temple's end.
TBD has a more conventional business model, with content offered free and geo-targeted advertising as a revenue stream. An initial mobile app will be free too, but Brady has said that there is potential for specialized paid apps, for instance providing real-time traffic reports.
A wrinkle in the TBD structure is that Allbritton owns two television stations in the Washington area, and the new site will replace their current Web offerings. The Post is not among newspaper organizations currently making noises about a pay wall, but my view is that strong TV-related sites could steal a share of audience should any metros move that way.
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The different business plans (and different parentage) of the two sites may answer another oft-asked question: What is the merging economic model for digital? It is under construction, or at least depends on the particular market and objectives of the founders. That's not an answer you can take to the bank, but it is likely to remain the state of play for awhile.


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