Newspapers have taken a large hit in the last year as the economy and a changing news landscape has badly eroded their near monopoly status.  Now there is talk about newspapers turning into non-profits to survive but industry insiders don’t think it will work for the major papers.

From Salon.com

In Minneapolis, MinnPost.com offers a mix of local reporting on politics, business and the arts, employing a staff of refugees from the declining local newspapers, as well as articles by local citizens. (MinnPost and Salon have co-published stories.) Joel Kramer, the editor and CEO of MinnPost, started the site two years ago as a nonprofit. “Quality journalism does not work as a consumer good anymore,” he says.

Kramer, who is the former editor, publisher and president of the Minneapolis Star Tribune, argues that the regional monopolies that newspapers used to enjoy have broken down. The big change, he explains, is that Mr. Newspaper Publisher can no longer kick back in his office with a cigar and establish ad rates. “The pricing power of publishers for advertising is dramatically deteriorated,” Kramer says. “That is the core issue, not whether readers love the stuff.”

Chip Giller, the president and founder of Grist, has in the past 10 years built a leading source for environmental news online, mostly with funding from foundations. (Grist and Salon have collaborated on several projects over the years.) Grist now spends about $3 million a year and takes in about $650,000 from earned income like sponsorships, with the rest coming from foundations and individuals.

Giller, though, believes foundations aren’t the ultimate answer for  journalism. ”The nonprofit world can be a bridge to a bigger solution, but I don’t think that there’s enough dollars in the nonprofit world to support the infrastructure to do the kind of investigative journalism and bird-dogging and watchdogging that’s required for a vibrant society,” he says. Besides, due to the recession, foundations’ endowments are down around 40 percent, which makes them less likely to try to take on the role of funding news gathering, given their many other urgent priorities.

In late March, Sen. Benjamin Cardin, D-Md., proposed legislation called the Newspaper Revitalization Act, which would help newspapers go nonprofit. While the papers would no longer be allowed to make political endorsements, they would operate much like public broadcasting with all the attendant tax benefits, including donations from readers.

But Kramer doubts his nonprofit model could save the big newspapers. “I don’t think that if the New York Times or the Boston Globe went nonprofit tomorrow they could sustain the size newsroom that the old model did,” he says. “I don’t think that the nonprofit model will get you there. I think it can create a lot of small success stories, but there is no way our model will support hundreds of journalists. It’s just not going to happen.”

Is there anything else this former editor of a big city daily, and now the CEO and editor of a nonprofit news site, would like to add? “Yeah, tell people to send us money.”

Giller is right.  It will take years for the foundations to recover from their marke losses and the industry doesn’t have that much time.  Any notion that individuals will feel compelled to contribute to save their local paper is ludicrous especially in this economy.

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