Journalism CAN Make Money

Posted December 19, 2017

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Former Huffington Post Executive Editor Jim Rich is leaving the HuffPo to start a nonprofit news organization.

In his departure note, Rich says: "local journalism is dead and it's not coming back."

Rich does not come to this from nowhere. Prior to working at the HuffPo, he was editor-in-chief of the NY Daily News for more than a decade.

"This sentiment was echoed by Refinery29 co-CEOs Philippe Von Borries and Justin Stefano yesterday, when they announced the digital media company was laying off 34 employees to cut costs."

Rich and the rest of these guys think that non profit is the only way that local news will survive in an online world. 

To which I say, BULL!

Sure, online does not deliver the kind of revenue that buying an ad in a newspaper or a spot in a TV show would have generated. That's for sure. But the problem is that these guys have not cut the cost of the way that they produce content, and there-in lies their problem. They also have not cut overhead.

So Refinery29 has to lay off 34 employees to cut costs? You want to know why? Just Google Refinery 29 Offices. (I would post the photos here, but I don't have the rights). Go ahead. Take a look at the unbelievable offices they have for an online media publication. Are they out of their minds? What does it take to go online? A computer? A phone? 

Do the same trick with Huffington Post. Unbelievable

What do you think the rent is on those places? 

The problem with all these media companies is that they are trying to live with a hybrid - income from an online site and offices and staffing (and no doubt video production methods) from an old school linear model.

It does not work.

We produced daily content for a cable concern for 12 years. All of our reporters worked from home. We had no offices. They all shot and cut their own video and uploaded it to us where we assembled the shows. Our total cost of production was $1500 per half hour. 

THAT makes for a profitable news organization.

You want to make a profit online? Get rid of the offices, the kitchens, the couches, the fancy meeting rooms, the carpet and the lighting, and probably half the management staff.  

You can make a nice profit.

Embrace what the tech can do. 

News does not have to be non profit, but it has to be done differently.