Dec 29, 2021 - Economy

New era for local journalism

Illustration of a newspaper-covered location icon casting a dollar sign shadow

Illustration: Sarah Grillo/Axios

New, independent digital outlets and nonprofits have begun to fill some of the gap left by fading local newspapers. Limited resources and the pandemic have driven many toward providing community news, information and services rather than traditional accountability journalism.

Why it matters: "It's not just about a legal or structural shift, but it also represents a shift in how the mission of journalism is changing," said Emily Roseman, research director & editor at the Institute for Nonprofit News (INN).

  • "The decline of local newspapers has not just led to more government corruption and waste, but also polarization and misinformation," said Steven Waldman, president and co-founder of Report for America, a local journalism nonprofit.

By the numbers: There are now more than 700 independent local news startups in the U.S. and Canada, according to Local Independent Online News Publishers (LION), a trade organization.

  • LION now has over 400 paying members, up from 177 at the start of the pandemic, executive director Chris Krewson told Axios.
  • By comparison, at least 100 newspapers have closed during COVID, said Penny Abernathy, a visiting professor at Northwestern University’s Medill School of Journalism.
  • Without additional government support, the U.S. could lose 100 more newspapers next year and another 500 over the next five years, she estimates.

Between the lines: New digital sites and legacy local newspapers alike are finding it difficult to attract sustainable, commercial investment, making philanthropic support and reader donations more important.

  • The number of local news companies that have registered as nonprofits has roughly doubled in the past five years, per INN.
  • The past year, saw "a tipping point" of people in the philanthropic world "understanding that nonprofits have to play a bigger role in local news," said Waldman.
  • New estimates from Poynter suggest around 50 local outlets were added during the pandemic, many of which are digital nonprofits.

Yes, but: Many local upstarts and nonprofits are still small compared to the newspapers that once dominated American journalism.

  • Most of LION's members (80%) have four or fewer employees. Many are individuals writing newsletters or blogs. "There's a line to be drawn between the nascent creator economy and work we're trying to do," Krewson said, referencing local newsletters on Substack and Facebook's Bulletin.

The big picture: The past two years have pushed local news companies to focus more on service journalism, but the value of that impact is hard to quantify to funders and commercial partners.

  • "There is a financial value of those services that hasn’t been calculated yet," Roseman noted. "If we quantify it, people will start taking it seriously," she said, referencing things like vaccine campaigns and extreme weather reporting.
  • Cassie Haynes, the co-executive director of Resolve Philly, a journalism nonprofit in Philadelphia, said her team sends local readers surveys about whether their journalism led to services or information that was "life-saving, life-sustaining and life-affirming" in order to measure its impact.

Between the lines: The trend also calls into question what the long-term business model is for accountability journalism — like investigations into local government spending and school boards — will be when larger newspapers continue to close.

What to watch: Government subsidies could help newsrooms move away from being reliant on commercial metrics that are often at odds with quality local journalism, like clicks, said Mike Rispoli, senior director of journalism policy at Free Press, a journalism advocacy group.

  • President Biden's Build Back Better plan included a $1.7 billion tax subsidy for local journalism. If it doesn't pass, state governments will need to take more action, he noted.

The bottom line: "It's an evolving marketplace with lots of volatility," said Fran Wills, CEO of the Local Media Consortium, which represents hundreds of local newspapers.

  • "People are looking at local media in a different way and starting to value it in a higher way than they might have pre-pandemic," she added.
  • The recent hostile takeover battle between the board of Lee Enterprises, one of the last independent local news chains, and hedge fund Alden Global Capital reflects the tension between the commercial market and local communities over the value of local journalism.
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