Journalism’s traditional advertising- and circulation-focused revenue model is crumbling. Even billionaire owner Jeff Bezos’ interest and investment haven’t saved The Washington Post from budget problems (Mullin & Robertson, 2022). As for-profit outlets large and small look for ways to stay afloat, many are turning to philanthropy as a safety net.
The Johnson Center first reported on growth in the nonprofit media landscape in 2019’s 11 Trends in Philanthropy report. That piece, “Nonprofit Media is Experiencing a Growth Spurt — So is Philanthropy’s Response” (Martin, 2019), primarily focused on the rapid proliferation of start-up nonprofit news outlets and the response from individual philanthropists (small-dollar donors and billionaires alike).
“[A]s commitments [to support journalism] increase, philanthropy will need to be careful not to fall into old patterns that could undercut its intentions.”
If anything, that trend has sped up since we first wrote about it, especially among providers of local news. According to the Institute for Nonprofit News (INN, 2022), 65% of the nonprofit news outlets that launched in 2021 had a local focus, compared to 57% the year before. In total, the number of newly-launched outlets from 2017 to 2021 effectively doubled the number launched in the previous five years — 135 new outlets, compared to the 69 outlets that appeared between 2012 and 2016.
This year we’re looking at a different aspect of the news landscape and its increasingly close relationship with philanthropy. In the for-profit news space, legacy brands and 21st-century digital natives alike are moving to explore, adapt, and adopt the nonprofit model. We identified three emerging models that indicate a shift in the future of news media.
Few have taken the dramatic step of giving up their for-profit status completely, although this has happened. In May 2019, The Salt Lake Tribune (established in 1871) became the first legacy paper in the United States to announce its intention to fully convert from a corporation to a 501(c)(3) nonprofit (Mele, 2019). In philanthropy’s backyard, the Chronicle of Philanthropy announced in May 2022 that it will break away from its for-profit parent, Chronicle of Higher Education, Inc., to become an independent nonprofit.
Yet the most activity seems to be in evolving ownership structures.
Many for-profit news outlets are holding on to their for-profit status while moving under the ownership of a nonprofit organization. For instance:
Media outlets looking to bolster their operations without structural change are increasingly turning to foundations.
Foundations are allowed to make grants to for-profit organizations such as news outlets as long as those grants substantially support the foundation’s already tax-exempt mission (IRS, 2022a). Another word for this type of activity could be “program-related investments” (IRS, 2022b).
In September 2017, The New York Times repositioned Deputy Managing Editor Janet Elder to develop a new internal department exploring philanthropic partnerships. In 2020, the Times announced a total of $4 million in grants from the Ford Foundation, Stavros Niarchos Foundation, and the William and Flora Hewlett Foundation to support the three-year Headway Initiative, the paper’s first majorly grant-funded project (Bauder, 2022).
Gannett Co., the largest newspaper publisher in the United States, also appointed a new senior executive position devoted to philanthropic partnerships in 2019 (Mele). The Associated Press’s Lisa Gibbs is building a similar department (Bauder, 2022). The AP’s efforts have recently resulted in more than $8 million in philanthropic commitments to support the outlet’s climate coverage.
The AP, Chronicle of Philanthropy, and The Conversation announced a new partnership and a $3.6 million grant from the Lilly Endowment in September 2020. Their joint work to cover and distribute news about philanthropy is “aimed at advancing the public’s awareness and understanding of the people and organizations trying to solve some of the world’s most pressing problems” (Associated Press, n.d.).
There’s no question that philanthropic support for journalism is growing. However, as commitments increase, philanthropy will need to be careful not to fall into old patterns that could undercut its intentions.
A free and independent press is widely acknowledged to be a critical pillar of a functioning democracy. Funders seeking to sustain this important work must ensure their methods match this mission.
Associated Press. (n.d.) Media distribution. https://contentservices.ap.org/media-distribution/
Associated Press. (2020, September 24). AP, The Chronicle of Philanthropy and The Conversation join to jumpstart coverage of nonprofit world. https://www.ap.org/press-releases/2020/ap-the-chronicle-of-philanthropy-and-the-conversation-join-to-jumpstart-coverage-of-nonprofit-world
Bauder, D. (2022, February 16). Climate grant illustrates growth in philanthropy-funded news. AP News. https://apnews.com/article/science-business-arts-and-entertainment-journalism-united-states-087d1d5dd7189c529fe5d7a21a1ffb5f
Berger, B. (2022, January 31). Chicago Public Media announces its acquisition of the Chicago Sun-Times. WBEZ. https://www.wbez.org/pressroom/chicago-public-media-announces-its-acquisition-of-the-chicago-suntimes
Chronicle of Philanthropy. (2022, May). The Chronicle of Philanthropy unveils ambitious growth plan to put national spotlight on social sector, become nonprofit. https://www.philanthropy.com/chronicle-of-philanthropy-news
Huang, J. (2018, February 23). LAist is coming back — under KPCC management. WKPC. https://www.kpcc.org/2018-02-23/laist-is-coming-back-under-kpcc-management
Institute for Nonprofit News (INN). (2022, July 27). The state of nonprofit news. https://inn.org/research/inn-index/inn-index-2022/
Internal Revenue Service (IRS). (2022a). Grants to noncharitable organizations. https://www.irs.gov/charities-non-profits/private-foundations/grants-to-noncharitable-organizations
Internal Revenue Service (IRS). (2022b). Program-Related Investments. https://www.irs.gov/charities-non-profits/private-foundations/program-related-investments
The Lenfest Institute. (2016, January 12). H.F. Lenfest launches the Institute for Journalism in New Media; Donates The Philadelphia Inquirer, Daily News and philly.com to it and makes a $20 million gift to a new endowment to ensure the future of independent journalism. https://www.lenfestinstitute.org/news/h-f-lenfest-launches-institute-journalism-new-media-donates-philadelphia-inquirer-daily-news-philly-com-makes-20-million-gift-new-endowment-ensure-future/
Martin, T. (2019). Nonprofit Media is Experiencing a Growth Spurt — So is Philanthropy’s Response. 11 Trends in Philanthropy for 2019. Dorothy A. Johnson Center for Philanthropy, Grand Valley State University. https://johnsoncenter.org/blog/nonprofit-media-is-experiencing-a-growth-spurt-so-is-philanthropys-response/
Mele, N. (2019, October 5). Philanthropic options for newspaper owners: A practical guide. John S. and James L. Knight Foundation. https://kf-site-production.s3.amazonaws.com/media_elements/files/000/000/434/original/Philanthropic_Options_for_Newspaper_Owners_final.pdf
Mullin, B., & Robertson, K. (2022, August 30). Frustrations mount at Washington Post as its business struggles. The New York Times. https://www.nytimes.com/2022/08/30/business/media/washington-post-jeff-bezos-revenue.html
New York Times. (2020, December 1). The New York Times announces philanthropic support for the Headway Initiative. https://www.nytco.com/press/the-new-york-times-announces-philanthropic-support-for-the-headway-initiative/
New York Times. (2017, September 1). A new role for Janet Elder. https://www.nytco.com/press/a-new-role-for-janet-elder/
Shapiro, G. (2005, December 9). An encounter with conservative publishing. The New York Sun. https://www.nysun.com/article/on-the-town-encounter-with-conservative-publishing
WAMU. (2018, February 23). WAMU acquires local news site DCist. https://wamu.org/around-wamu/wamu-acquires-local-news-site-dcist/
WYNC. (2018, February 23). WNYC, two other public radio stations acquire Gothamist and sister sites. https://www.wnyc.org/story/wnyc-other-public-radio-stations-acquire-gothamist-and-sister-sites/