Low-cost online publications look to subscriptions, banner ads
Tom Korski is convinced that government regulations and red tape are the keys to turning profits – at least, for him and his upstart publication.
© Cole Burston
Blacklock's Reporter editor Tom Korski.
The veteran parliamentary reporter started an online news site in October aimed at lawyers, lobbyists, accountants and other professionals who regularly deal with the federal government. The goal of Blacklock’s Reporter is to provide an in-depth look at the inner workings of one of the country’s biggest spenders.
“The only way this fails, ultimately, is if people don’t care what the government of Canada is doing anymore,” said Mr. Korski, the publication’s editor.
Blacklock’s Reporter makes money from online advertising and subscriptions. Mr. Korski said the publication needs to sell 400 subscriptions annually – which, at the current rate of $148, would work out to $59,200 – to make money.
It’s one of several upstart online news outlets in Ottawa operating with a lower cost structure than traditional daily news organizations. Sites such as Blacklock’s Reporter and OpenFile don’t have any printing expenses and use freelancers to write most articles, rather than unionized journalists.
“The traditional print business, even as it moves to digital, is stuck very much in old ways,” said OpenFile founder Wilf Dinnick. “No matter how much they try to innovate, there are certain legacy parts of the business that ... hinder them from focusing just on digital.”
Niche publications have little chance of eclipsing the bigger daily outlets when it comes to sheer readership numbers. But Mr. Korski believes they offer more value for Blacklock’s Reporter’s advertisers, which last week included a Toronto law firm, a research institute and the Ottawa Convention Centre.
These news outlets – which, in Ottawa, also include the Parliament Hill-focused iPolitics – say they can attract a narrow demographic of readers that are more likely to be interested in an advertiser’s products or services.
Consumers are becoming more used to paying for digital content as traditional media organizations such as the Globe and Mail and the Ottawa Citizen erect paywalls. Mr. Waddell thinks this may make it easier for specialty outlets that survive off subscriptions to convince readers it is worth paying for their content.
“If you’re the only guy out there asking someone to pay for information online, that might be a lot tougher sell than if everyone’s doing it and you’ve got some sort of special information that you think people will pay for,” said Mr. Waddell.
Part of the challenge, though, will be trying to figure out the right balance between low subscription rates and advertising dollars.
Mr. Waddell believes some news organizations may be able to survive primarily off subscription revenues. In those cases, publishers will need to ensure they set their rates low enough so that they still have enough readers to attract the interest of advertisers.
However, some publications are experiencing early hiccups.
OpenFile hasn’t published a new story on its Ottawa website since September, when Mr. Dinnick said in an online post that the site was taking a “pause” for a few weeks as it underwent “a pretty big change.” He said the publication is looking for a new source of funding to help with future growth.
Mr. Dinnick ordered an audit of the organization’s books and many of the freelancers working for the publication were still unpaid as of mid-November.
Tom Korski, the publication’s editor, wants to offer coverage that goes beyond the personalities in Canadian politics and provide a look at the inner workings of federal policy. Last week featured stories on a court case involving “redefined deductible medical expenses” and the possibility of a fitness tax credit.
The site operates on a subscription model. Customers pay $148 for access to content for one year.
The publication, which first started operating in October, is owned and operated by Mr. Korski and several other veteran parliamentary reporters.
iPolitics, which started in 2010, offers subscriptions for $180 a year.
The publication has several staff reporters as well as more than 100 contributors, according to its website.
It delivers “briefs” in both the morning and evening to subscribers by e-mail, which serve as a round-up for the day’s relevant news. Subscribers also get breaking e-mail alerts.
iPolitics highlights the personalities around Parliament Hill and examines federal policy, with regular updates on the minutiae of committees that usually don’t make it into the daily press.
OpenFile, which has editions for Ottawa, Toronto, Montreal, Halifax, Calgary and Vancouver, was built on the idea of reader-generated news content. Members of the community would suggest ideas that the organization’s reporters and editors would refine into stories about local issues.
It promised to deliver engaged community members to advertisers and also received money from Postmedia papers in exchange for content.
Mr. Dinnick started the site two years ago with funding from an anonymous corporation. But that money is expected to run out within the next year, prompting the shutdown as it searches for a new source of funding.
He said he’s on track to become profitable by the end of the site’s third year.