Colorado's newest digital publication is bucking many of journalism's business conventions: It aims to be ad-free, reader-supported and employee-owned and will partner with a media technology company to have its website data recorded on the blockchain, in perpetuity.
The Colorado Sun and its partner, Civil Media Co., are banking on blockchain technology to foster new business models to support journalism. If their initial efforts are successful, they could demonstrate a path to building news outlets free from corporate interests and advertising pressures, a significant development as newsrooms face shrinking ad revenue and management woes. The founding partners of the Colorado Sun left the Denver Post amid rounds of layoffs and allegations of editorial interference from its hedge-fund owner.
Larry Ryckman, the editor of the Sun and former senior editor for news at the Denver Post, said the technology offers the Sun added accountability and transparency. Because blockchains are public ledgers that can't be manipulated, advocates say the technology could stem the spread of doctored news stories or disinformation. By allowing readers to verify where a story came from and ensure that articles are protected from censorship or deletion, Ryckman said the blockchain holds value for journalists and the Sun.
On top of building trust and verifiability, backers say blockchain technology can also generate new types of revenue models for publications, such as direct contributions and mission-specific reporting projects financed without transaction fees.
The Sun is working with Civil to develop the blockchain system. It's one of more than a dozen publications backed by the platform. Civil has pledged $1 million in grants to support an initial round of outlets launching this summer, which are collectively hiring more than 100 full-time, experienced journalists, according to Civil's website. The New York Times first reported on the Colorado Sun's unveiling.
The decentralized, independent model that Civil is building attracted Ryckman and his team. Ryckman said he resigned from his position at the Denver Post after its owner, Alden Global Capital, continued to pursue demoralizing layoffs and began to demand editorial changes to the paper's coverage. "We are no longer working for some evil hedge fund. We are working for ourselves, for each other," he said. "We've all lived under corporate journalism, we have all worked for hedge funds, and we have seen what that looks like. It's a world where profits drive decisions." He sees Civil's platform as a viable alternative.
Alden Global Capital did not respond to a request for comment.
The Colorado Sun considered taking the NPR nonprofit route, Ryckman said. But he quickly learned that path is slow-going, requiring months just to obtain nonprofit status. Meanwhile, many felt conditions at the Denver Post were deteriorating by the day, and Civil offered the funds to get up and going right away. When Civil approached Ryckman, he said, he began the discussions as a skeptical journalist. But his team was won over by Civil's mission. "It's time to find a new model to support local journalism," he said.
Under Civil's model, newsrooms will directly receive compensation from readers, who can give publications money using traditional credit card vendors and cryptocurrencies. Civil says it will not take a cut of the transactions. For the Colorado Sun to create a sustainable revenue model, Ryckman said, "it's on us to produce stories that matter." When funds from a Kickstarter campaign and Civil run out, the Sun will rely on subscribers, donors and investors, he said. Ryckman declined to say how much money Civil has given the Sun. But he said that neither he nor the founding journalists and editors took a pay cut after leaving the Denver Post and that they are confident in their new outlet's financial future.
As part of its decentralized model to support journalism, Civil plans to release a digital token this summer, called CVL, according to the company's website. Interested readers can use the tokens as currency to contribute to their favorite publications hosted by Civil. People who own CVL tokens will also be granted voting rights to make decisions within the Civil ecosystem, such as challenging a new publication's application to join the platform.
Matthew Iles, the chief executive of Civil, said the tokens will also play a part in future products and services that will support news outlets financially, such as a seamless donation system with fewer transaction costs and sponsorship programs in which token holders can back a reporter's investigative project in their community.
Since creating the Colorado Sun, Ryckman said, he's received an outpouring of community support. Just 48 hours after the publication launched a Kickstarter to fund its fledgling operations, the Sun surpassed its $75,000 goal. The outlet's staff is working out of prime downtown Denver office space given to it free; another property owner offered to give the Sun free space for a year.
Later this summer, the Colorado Sun will produce a newsletter three times a week and publish a website showcasing original stories, Ryckman said. "At the end of the day, this is not about blockchain or about cryptocurrency economics," he said. "It's about great local journalism. And great local journalism is worth fighting for."