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Wednesday, 2 October 2013

What does the Guardian need to do to survive?

New Yorker feature writer Ken Auletta's profile of the Guardian's Alan Rusbridger is, for liberals, a bit like a sweet treat with no health consequences: did spending 15 minutes reading the story on your screen impair your vision? The answer is emphatically no. Does the world desperately need the Guardian? The answer is: that depends. Auletta's approach is prima facie biased, for a start, admitting up-front that a media outlet led by a single person is the only way to go, but what can you expect from the New Yorker? For, given the likelihood that your business will be more than just scrutinised by those who have something to lose by your publishing stories - politicians and state functionaries occasionally drop by for a discrete chat, with all the menace that that mundane epithet implies - it seems that some sort of top spokesperson is advisable. Nevertheless, the Guardian's latest coup - the Edward Snowden stories - emerged from the keyboard of a freelancer based in Brazil, Glen Greenwald.

Assuming for a moment that the Guardian is indeed necessary for the survival of democratic polities - let's say the OECD or, more appropriately, the countries of the Anglosphere - there's still the issue of cost. Rusbridger has aggressively carried the UK brand globally - there are now websites operating out of the US and Australia, with possibly more to come (India, perhaps?) - and he's kept access completely free, which means he's relying on serving ads to readers. Auletta's story notes the Scott Trust, which bankrolls the newspaper, possesses 254,000,000 pounds Sterling in liquid capital. There's no mention of other assets the trust might own, but even on this basis you can count reliably on an annual income of just under 13,000,000 pounds (at a benchmark rate of five percent earnings on capital). Outgoings in the most recent financial year, however, were 31,000,000 pounds and Rusbridger wants to trim those losses:
[Andrew Miller, the director of the trust and the C.E.O. of the Guardian Media Group] admits that he does not foresee the newspaper earning a profit anytime soon. Rusbridger said, “The aim is to have sustainable losses.” Miller defines that as getting “our losses down to the low teens in three to five years.”
Given these figures, it's probably overly pessimistic to deduce that the Guardian will run out of money in three to five years, as Auletta's story says will happen, but clearly a new business model is needed.

If the paper's Australian website overtook Rupert Murdoch's Australian in pageviews within weeks of its launch, as Auletta's story reveals, there's still plenty to be optimistic about. The Guardian prides itself on being disruptive and this is why people read it so happily but the disruptive effect of the internet is equally harsh on those who fail the relevant test. It's not whether you deserve to survive that counts, it's whether you have the flexibility to survive. Rusbridger's maintaining the UK print edition seems to me to be a weak spot, acknowledging though that this vehicle is responsible for a significant quantity of the paper's income. But the approach of Rusbridger, while it appears to be very positive, may signal that it is time for him to go and to let someone who is more attuned to the online world, take over.

The US and Australian forays have been led by watching website traffic, but Auletta's story also tells us that Rusbridger spent time in the US as a reporter decades ago. Making the move to that market is therefore a step in line with his own personal biases. Going to Australia appears to me to be a toe in the water in advance of entries into other, bigger, markets such as India. But it's not just the places it operates that will determine whether the Guardian can stay afloat down the track. A new business model is going to become imperative.

The Guardian has reached out to its readers - many will remember the paper spruiking its open journalism idea in February last year; remember the three little pigs? - but it has held back from adopting a crowdfunding model, a model of income generation that has proved itself lucrative time and time again. Many Australians will be aware, very recently, of the success of the Climate Council in raising funds (it emerged from the Climate Commission, a government-funded body the new federal government abolished); five days ago it was reported they'd raised $1 million from the community alone. There's also the example of Kickstarter, the crowdfunding site that has helped to bankroll 49,000 creative projects since 2009. I'm not saying that the Guardian has to post each major investigation on Kickstarter, with a video, to get its book filled but these are the things that Rusbridger needs to think about if he wants to cut losses to below that key 13,000,000 pound threshold.

But I'm not sure that Rusbridger is up to it. His presence on Twitter, for example, is minimal and relies mainly - in fact, totally, as far as I have seen - on pushing story links to readers. There's no real engagement, nothing sticky that he's doing to make people follow him. Other editors with the paper are better at this. It's a generational thing, I believe. Rusbridger has done fantastic work for a long time and, yes, he's got spine. For the Guardian to survive though he must relinquish his post and hand over to a person who better "gets" the web and who also has that journalistic background. That person might think about ways to help develop more freelancers, too, in the mold of Greenwald. Brazil looks nice don't you think?

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