Meeting Funding Challenges of Local News Worth the Creative Effort
Greg Wilson/Anderson Observer
Funding local news
I get a number of questions on how The Anderson Observer offers subscription-free local news seven days a week. The simple answer is a combination of advertising, Patreon support and freelance work for other outlets all contribute to making daily news possible at the Observer.
As a journalist of almost 50 years, and one whose publications reach back even farther, funding has always been a challenge even in the more golden days of newspapers. Add to that journalist salaries, which have historically been the lowest paid professions for those with undergraduate degrees and those with master’s degrees, and professionals have long supplemented their income with freelance work.
And yet, local journalism is still important to our communities now more than ever.
The Old Newspaper Wall
There used to be a wall down the middle of every American newspaper, and everyone who worked there pretended not to notice it. On one side of the wall were the people who wrote the stories. On the other side were the people who sold the ads. They shared a building, occasionally shared a parking lot, and, in the smaller papers, sometimes a coffeepot and in the old days, ashtrays.
Advertising would ask the copy desk to avoid putting a story about a plane crash next to a United Airlines ad and were generally met with at least grudging approval.
For more than 50 years, that division has been under pressure from every direction at once. The advertising model that made it possible has collapsed.
The ownership of many local newspapers that were once connected to the community, have been replaced by hedge funds and private equity firms with no reverence for its traditions of local affectations.
The local print papers that embodied it most honestly — the ones that endorsed the county council candidate on the editorial page on Monday and ran his opponent's hardware store ad on Tuesday without a second thought (something we did regularly at the Anderson Independent and Daily Mail in the early 1980s) have been closing at the rate of more than two a week for the better part of a decade. What is left of American local journalism is, in many places, a negotiated settlement between the ghost of what the industry was and the economic reality of what it has become.
The Profitable Era
The postwar American newspaper was mostly profitable in decades of its existence and essentially a monopoly for advertising. Most cities had a single daily newspaper and a captive advertising market that had nowhere else to go. Retailers, car dealers, movie theaters, grocery stores (which provided huge Wednesday newspapers), and department stores all needed to reach locals, and the local newspaper was the only reliable way to do so. Classified advertising — the small-type columns listing jobs, apartments, cars for sale, and personal notices — was, for decades, among the most profitable products any business in America sold. It required almost no labor to produce, almost no space to run, and generated revenue in direct proportion to how many people needed to buy or sell something in any given week, which was always a very large number.
A wall between editorial and advertising existed not despite the profitability of the business but because of it. A newspaper making money hand over fist—and there was a day when many were—could afford to alienate advertisers. The local department store might pull its ads after an unflattering story about disgruntled employees, and the newspaper would survive the loss. The leverage ran, however uncomfortably, toward the newsroom. Editors could say no — to the car dealer who wanted a puff piece timed to the new model year, to the bank that expected favorable coverage of a merger, to the developer who believed that buying the back page entitled him to a favorable editorial on his rezoning application. Not every editor said no. But the financial structure of the business made saying no survivable.
It was almost quasi-religious in character. Journalism schools taught it. Professional organizations enforced it or tried to. Editors who crossed the wall were censured; publishers who pressured them were condemned in the trade press. The wall was never absolute. There were advertiser-friendly sections, special supplements and real estate pages that served as a kind of permanent tip of the hat to the industries they covered. Still, the wall’s existence as a norm shaped the behavior of the people on both sides of it. The sales staff knew they were not supposed to promise editorial consideration. The reporters knew they were not supposed to ask who was buying ads before they wrote a story. The system was quietly imperfect in the way that most institutional systems are imperfect.
Consolidation And Decline
The divide began to weaken before the internet arrived to demolish it. The instrument of its early weakening was consolidation. The family-owned newspaper — the paper whose publisher lived in the community it covered, attended the same churches and community organizations as its subjects, had a personal stake in the community's opinion of the institution — was, by the 1980s, being absorbed into chains at an accelerating rate.
Gannett, Knight Ridder, Tribune, Hearst, MediaNews: the names varied but the logic was identical. Scale reduced costs. Regional printing facilities replaced local ones. Editorial staff was shared across properties. The bean counters arrived, and the bean counters did not care about the wall.
Chain ownership changed the relationship between advertising and editorial not by abolishing the wall but by shifting the incentives on both sides of it. Distance dissolved it.
The space between what the paper could plausibly earn and what its new owners needed it to earn was filled, in many cases, by squeezing editorial — cutting staff, shrinking newsrooms, shrinking the size of the news hole and eliminating beats. Fewer reporters meant less coverage. Less coverage meant a less-essential paper. A less-essential paper meant declining readership. Declining readership meant declining advertising rates. The chain economics, which had been sold as the salvation of local journalism, turned out to be a slow-motion version of its opposite.
The Internet’s Disruption
The internet did not destroy local print newspapers gradually. It destroyed one revenue stream catastrophically and then waited for the rest to follow. Craigslist launched in San Francisco in 1995 and within a decade had effectively eliminated the classified advertising market that had been the financial foundation of the American local newspaper.
The numbers were staggering as classified advertising had generated roughly $19 billion annually for newspapers at its peak. By 2010, that figure had been cut by more than three quarters. The jobs, the apartments, the cars for sale — all of it migrated to platforms that were free to use and indifferent to geography, and it did not come back.
Display advertising followed. The retailers who had once had no choice but to buy a full-page ad in the local paper discovered that they could buy targeted digital advertising at a fraction of the cost, reaching specific demographic profiles rather than the general readership of a geographic area.
Google and Facebook captured the programmatic advertising market that newspapers had hoped would be their digital salvation. The money that had once supported newsrooms now flowed to platforms that employed no journalists and accepted no responsibility for the quality or accuracy of the content they distributed.
What remained, for many local newspapers, was a diminished and increasingly transactional relationship between the newsroom and the advertising department became a luxury some thought they could no longer clearly afford. Special advertising sections multiplied. Native advertising — paid content designed to look like news — arrived with a disclosure label often so small it was functionally invisible. Sponsored content, branded content, partner content: the euphemisms proliferated in direct proportion to the embarrassment the underlying arrangement occasioned. The divide was not so much crossed as quietly relocated until the newsroom found itself occupying territory it had not intended to cede.
New Models For Local News
The decline in print newspapers gave rise to local online newspapers, which, not encumbered by the cost of paper, ink and delivery, could focus resources on local news.
Nonprofit local news organizations (and The Anderson Observer will soon join their ranks), funded by foundations, individual donors, and reader memberships, are working to replicate the editorial independence of the old model without the advertising dependency that ultimately corrupted it. The South Carolina Daily Gazette, The Texas Tribune, The City in New York, The Baltimore Banner, VT Digger in Vermont: these operations have demonstrated that serious local journalism can be done without advertising as a primary revenue source. They have also demonstrated that it is difficult, that donor bases are difficult to sustain and expand, and that foundation funding comes with its own set of expectations that are not always identical to editorial independence.
Hyperlocal news sites often run by single journalists covering a school board and county council with the same attention that a metro daily once devoted to a major city — have proliferated in the gaps left by the void of local print daily newspapers. Some are advertising-supported; some are subscription-supported; some are both; some run on the labor of a single person who has decided that the coverage matters more than the business model. These operations are often excellent. They are also often precarious, one health crisis or family emergency away from disappearing.
How The Anderson Observer Works
This makes it essential to find collective sources of income to fund the local news efforts. While publishing the daily local news in The Anderson Observer, I write (and have written) for other publications as well as shooting freelance video projects for Anderson County’s television/streaming channel and a variety of other outlets regionally and even sometimes nationally. Observer video offers commercial video services to businesses and individuals as well as SOS editing services for those who have a video project that needs repair.
It has never impacted coverage of those for whom I provide content. The Observer has been a critical voice in pushing county council to for months raise salaries of deputies, at a time when almost half were eligible for food stamps and been critical of the county and council on numerous other issues over the years with less success (lost track of how many times I have made a case for a county hospitality tax).
I have watched council members come and go, some good, some not, and observed the transition from a county supervisor to county administrator form of government. I witnessed the expansion of council from five to seven members. And I have attended and written about county council meeting since the early 1980s, when I was editorial page editor of The Anderson Independent. My editorial independence has remained unchanged as nothing has changed in my approach to coverage.
Independence and Purpose
As my mentor, L.S. “Slim” Hembree, who had been editor of The Anderson Independent for almost 50 years when we met told me: “You will get attacked in this business, someone will always accuse you of one thing or another, but that only means you are hitting your target and doing something important. It also means you have readers.”
After more than 19 years, The Anderson Observer remains a watchdog for the community, while at the same time serving as an advocate for those things deemed good in our community, the towns/cities and the county.
Fair and vigilant coverage has remained the goal of local journalism for most of the last century and The Anderson Observer plans to continue that tradition as I remain grateful to current and previous advertisers, sponsors, Patreon supporters and, all readers who look to our daily newspaper for local news.
And a big shout out to the others at local publications and their advertisers and sponsors who are keeping the flame of community journalism alive: David Meade at The (Williamston) Journal, Julie Bailes Johnson and Ginny Bailes Fretwell and The Electric City News and the photography of Ken Ruinard at the Anderson Independent-Mail.
