Matching the market and the model: the business of independent news media

• Michelle J. Foster
• Center for International Media Assistance

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24 August 2011Around the world, news media and distribution channels are growing at significant rates as economies emerge and expand. Print is a vibrantly growing business in the Middle East, China, India, and parts of the Americas, and legacy media often supply the content that flows through online channels. Mobile distribution of news is changing the playing field in Africa, India, the Middle East, and elsewhere. The online audiences for news content are expanding rapidly and typically exceed the local market footprint of the organizations that produce them. In the United States, there are virtually no pure play newspapers or broadcast news media left: They have adapted multiple distribution channels and multiple product lines, along with developing new expertise in a wide range of marketing communications techniques.

Google CEO Eric Schmidt observes that these changes, some of them traumatizing, are actually an affirmation that the news business is still vital and necessary. News media “don’t have a demand problem,” he has said, “they have a business model problem.”

Failure to solve these business model problems, however, threatens the sustainability of media, especially the independent media that often operate under business constraints, such as restrictive licensing requirements or libel suits. A significant risk to being able to solve those problems is the lack of management and business skills among media owners, which can make them reactive to the economic challenges and technology-driven changes in the media environment. Without business acumen, it is almost impossible for media operators to shape, adapt, or create new practices.

This report focuses on the changing business models that are helping independent media organizations succeed in emerging and developing markets. It examines some of the current practices that limit the effectiveness of independent media owners, identifies new and hybrid methods of funding news media, examines the business constraints that media operate under, and showcases examples of media assistance efforts that have made a significant difference to local media.

Today the only “right” business model is one that works within local market conditions, and any media development program that seeks to provide meaningful support must be tailored to that reality. “No model is automatically better or worse than any other,” said Eric Newton, senior adviser to the president at the John S. and James L. Knight Foundation. “You need to match the model to the place … The only real mistake these days is not to try something new.”