NPR’s Digital Makeover

Proponents say, just create an endowment?
Well, in order to create an endowment that's going to fully support the operating budget of a large national-international news organization, that endowment would have to about $8 billion—no exaggeration.

A large national and international news organization like, say, The New York Times? Lately, it has been toying with the notion of philanthropic support for some of its journalism. How would that work?
I suppose that a commercial news organization could continue with their existing revenue streams and ask money from foundations and individuals. Ask for donations, right. The problem is, if I'm a donor, how are you going to explain to me how my money is going to be used when you're giving out dividends to shareholders?

Would a donor, for example, in effect indirectly subsidize the company's payment of 14 percent finance charges on its borrowing from Carlos Slim?
Yes, that's the problem. That's sort of the beauty of a not-for-profit, like ourselves. We're beholden to no one. No financier. Our gifts come with no strings attached, or we won't accept them. Nobody is getting rich off of it. It's a big issue. So then there's a notion, only our foreign coverage will be philanthropic, for instance. In a multiplatform world, you can't separate those things. When they start asking philanthropists for donations, it's a slippery slope and it becomes very very murky.

Surely, The New York Times would disclose all of this?
Yes, the Times is all into transparency. To me, any legitimate, quality enterprise would need to be explaining exactly how the money would be used. And that's what gets into this issue. Is some fraction of that going to pay off debt? Is it going to Carlos Slim? Or another financier, if it's some other newspaper and not The New York Times.

While employed by The New York Times , you helped the newspaper stop charging for online content. Now it's reconsidering. Generally, why do you oppose paying for content?
I am a staunch believer that people will not in large numbers pay for news content online. It's almost like there's mass delusion going on in the industry—They're saying we really really need it, that we didn't put up a pay wall 15 years ago, so let's do it now. In other words, they think that wanting it so badly will automatically actually change the behavior of the audience. The world doesn't work that way. Frankly, if all the news organizations locked pinkies, and said we're all going to put up a big fat pay wall, you know what, more traffic for us. News is a commodity; I'm sorry to say.

But the Times did get people to pay, right?
We far exceeded our expectation—225,000 subscribers paid $50 a year, in addition to the home delivery subscribers, who got all of the Web for free. But guess what, that's $10 million. Instead of 225,000 who pay the $50, let's say it's one million subscribers. OK. That's $50 million a year. That's not going to save any newspaper. It's going to kill your advertising base. The numbers don't work.

What must they do?
I believe the national newspapers are going to be fine. The New York Times and the news site are profitable. There's a misconception that New York Times loses money. It makes a lot of money. For national newspapers like the Times or the Wall Street Journal, there's still a lot of money there. So [the Times is] trying figure out their [debt-repayment] problems. I think they'll have to probably cut more expenses, undoubtedly. They are not going to go under. The quality isn't going to take a nosedive.

© 2009