Can Your News Subjects Pay for Your Newsroom?
Newsrooms are hurting (Breaking News, right?) and the promise of online revenues replacing the fount of print advertisement has been either a disappointment or a glacial process doing little to ward off layoffs and shuttered bureaus.
But news outfits are still producing high quality stories, some of which can have a tidal effect on the industries touched by the reports and exposés, creating a potential revenue stream hitherto untapped.
Freakonomics picked up an April 24 blog post by widely-read Reuters finance blogger Felix Salmon, who argued early access to big stories are a big draw to traders, financial types, and other special interests:
Perhaps the most surprising thing about the NYT’s Walmart exposé this weekend is that it was such a surprise to the market… the market was taken by surprise, with $12 billion of market capitalization evaporating from Walmart and Walmex in one day.
Shouldn’t the NYT, which can always use a bit of extra revenue, take advantage of the fact that its stories can move markets so much? Not directly: I’m not suggesting that the New York Times Company should start buying out-of-the-money put options on Mexican corporates in advance of its own stories. But how much would hedge funds pay to be able to see the NYT’s big investigative stories during the trading day prior to the appearance of the story? It’s entirely normal, and perfectly ethical, for news organizations, including Reuters, to give faster access to the best-paying customers.
All that’s needed is that when a big story is entering the final stages of layout and fact-checking, a version is sent under strict embargo to a client or clients who have paid for that access. They can then act on the story in the markets.
So what do you think? With the billions of dollars floating in the education space, would your editors or publishers be game for such a subscription platform with the companies affected by breaking stories? Might it even incentivize enterprising journalism? What are the risks, and what are the perks?
This post originally appeared on EWA’s now-defunct online community, EdMedia Commons. Old content from EMC will appear in the Ed Beat archives.