GlobalPost Launch is Luce-Like in Its Timing
GlobalPost will get a lot of digital ink Monday, and deservedly so. It takes moxie to launch a news enterprise into the deep, winter gloom of The Worst Economic Downturn Since the Great Depression. It's like Henry Luce founding Fortune in 1930.
GlobalPost founders Phil Balboni and Charlie Sennott ("Charlie and Phil's Excellent Adventure") are pushing forward at an opportune time. They are zagging — assembling a staff of 70 correspondents worldwide — while the rest of the journalistic world zigs downward. Full-time staff include 14, mostly editorial.
Take a look at the GlobalPost site. Of course on its first day, there's more throat-clearing and set-up then we'll expect to see when the site gets rolling into the news. We can see its breadth though already, and the experience and talent of its writers. It will be fascinating to compare GlobalPost head-to-head with the Times, the Post, the BBC, CNN, AP and Reuters on the stories that matter. It must offer not only excellent journalism, but journalism that stands apart; otherwise, it could easily fade into the Internet ether.
On the day of launch, though, what I think is most significant about the new site is this:
- It's a membership model. GlobalPost invites its readers to get a "Passport" for $199 a year, $50 for students. As CEO Phil Balboni told me, "You must develop consumer revenue online." I asked Phil, longtime head of New England Cable News (which gets plaudits for its journalism and business smarts) whether that move was a philosophical one — that readers would have more attachment to something for which they paid. No, he said simply, it's an economical imperative. He says that he hopes that over time, membership fees will make up 40% of the company's revenue, with the rest coming mostly form advertising and some from syndication. Passport members will get several kinds of unique access to the site and its correspondents.
Why is the member initiative so key? Newspapers, as they accelerate
their move to digital more rapidly (Detroit, East Valley Tribune,
Klamath Falls and many more in the works) are losing one of their
primary revenue supports — circulation, which has been a consistent
20% of revenue over time. That leaves them wholly dependent on an ad
economy, very much itself in revolution. GlobalPost's membership model
resembles MinnPost, which has something more than 1000 members after a year.
News(paper) readers around the country have been complaining about the reduced size of papers and the fewer stories they're getting. Even as they migrate online though, they haven't had the case made to them that they should voluntarily support good journalism. That's why these models are so important in their testing of how much support can be gained.
- It's a for-profit model, with shareholder stakes for correspondents. As a globally oriented news service, Balboni understands that he's got a huge, potential reader base. The site is targeted to a US reader — base of 240 million+ — and then there's that market of 900 million-plus who speak English worldwide. It is a big business opportunity and sends a different messsage than do non-profit models, which have their place in testing as well. Further, by offering the potential of significant upside to correspondents (who vest over five years), GlobalPost is aligning the digital news revenue economics of today — paying correspondents $1000 a month — with hopes, however wishful, of future payoffs. Balboni has raised $8.2 million to fund a slow burn rate and hopes to add another $1.8 by year's end to make plan.
- It's a newer journalistic model. Lost in the business model focus can be the journalistic innovation. Sennott, a former Boston Globe global correspondent, has pushed hard on having correspondents based largely in single countries. They'll focus on those single countries, getting deep, rather than roving around a continent or sub-continent. So as we see most services cutting back on foreign reporting — and spreading their resources out thinner and wider — GlobalPost is trying the opposite tack. Another zag — in a world that needs all it can get.
