Our Response: New Resources, New Model

Democracy demands that journalism be saved even if for-profit newspapers wither away as the Internet gobbles up the advertising they long relied on. In the unfolding Digital Age, new resources have to be brought together to ensure journalism's future, particularly at the community level.

Banyan has devoted more than four years to exploring this puzzle, and the solution it advocates for independent community news efforts is a new model that draws resources from:

Consumer cooperatives along the model of food co-ops, credit unions and long-established reader-owned newspapers in the UK, Italy, Germany, Switzerland and Mexico. Community news efforts that set up as local co-operatives can use annual membership fees as a crucial new revenue source. The inherent trustworthiness of cooperatives--a very different but powerful resource--further strengthens this model, which is in essence an ndependent community institution.

Advertising. It remains a natural pairing with news, albeit at a much lower level than in the newspaper era, so community news co-ops can rely on some advertising to help pay staff and cover other expenses.

Web-era peer networks, which have unleashed vast amounts of freely shared collaboration -- an important new resource. The most vivid examples are Wikipedia and crowdfunding websites such as Kickstarter, through which millions of people have contributed more than $1.5 billion for art and technology projects since 2009. The civic engagement spaces in the software that Banyan supplies to affiliated news co-ops can create an environment that maximizes this kind of freely shared collaboration on a community scale, thus amplifying the power of a co-op’s journalism and leveraging the productivity of a co-op’s staff.

A community of editors and executive directors of independent community Web news co-ops who come together, with Banyan and its array of services at the center, to strengthen one another by sharing best practices.

There is no exotic new invention here. What’s novel is synthesizing these disparate but proven resources in the service of community Web journalism. The synthesis makes it possible for independent news co-ops using model to draw from the four sources of revenue detailed below, and thus to thrive even in communities that lack the advertising dollars to support original reporting by dying newspapers that rely heavily on advertising revenue.

The consumer cooperative form is the bedrock for Banyan’s model. We chose this base for two reasons: 1) the power of its inherent trustworthiness, which arises because in this form of business entity there can be no structural conflict between serving the customers and serving the owners, and 2) its strength and stability in economic settings too arid to support for-profit models; this has proven true for a long list of industries the world over.

In fact, people rarely come together to shoulder the voluntary work of forming a co-op except in response to the market failing to deliver something needed. For example, the number of credit unions exploded when credit dried up due to bank failures during the Great Depression.

The Banyan Project is a response to a similar drying-up, that of reliable news and information in an ever-expanding number of communities.

The co-op form figures in all four of the main revenue streams the model draws from:

Annual membership payments, long a staple of European co-op newspapers, have yet to be tapped in the U.S.

Advertising. To help local advertisers adhere with the news co-op as a community institution, the model includes a special business sponsor category of co-op membership; for an annual fee these members would receive a business directory listing, an advertising discount and other benefits.

Crowdfunding of major reporting projects. Co-ops’ trustworthiness makes them ideal for cultivating crowdfunding, which is peer networking monetized.

Grants. Because co-ops are by law oriented toward service rather than investor profit, they will be able to seek grant funding for special projects or to ensure coverage of specific issues, such as the environment. Such grants will likely be sporadic and most will flow through a fiscal sponsor.

Further, the co-ops’ trustworthiness makes them ideal seedbeds for the great productivity of Web-based peer networks; distrust smothers the human urge to collaborate voluntarily. The software Banyan will provide to affiliated journalism co-ops is designed not only to deliver their news but also to cultivate two distinct kinds of peer networks.

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The Banyan Project is a nonprofit organization founded from the thinking of 30 senior journalists, academics, Web developers, sociologists and researchers, business and financial strategists, and advocates for strengthening democracy brought together by Tom Stites. Members of this Board of Advisors are listed below; click on names to see bios.

Stites shaped Banyan's model as a fellow of the Berkman Center for Internet & Society at Harvard University. He is now helping a committee of community leaders who are organizing Haverhill Matters, the nation's first community Web news co-op in Haverhill, Massachusetts.

Read more about Banyan Project.