Dumenco: Who will fund media if billionaires bail?

Posted by Leah McBride Mensching on February 9, 2010 at 2:10 PM

Rupert Murdoch owns News Corp., the Sulzberger family controls The New York Times and Sam Zell bought the Tribune Co. Much of the media industry is owned by billionaires, but what will happen if financial woes push them out of media?

"Nobody likes to admit this, but much of the best of contemporary journalism has been produced, and continues to get produced, simply because of the largess - and the emotional needs - of a small group of rich people," Simon Dumenco wrote for AdAge yesterday.

As print ad revenue fades, many news organisations are considering non-profit, foundation-type business models to finance journalism. However, "no publishing model is immune to change - especially when one influential person runs the place," The New York Times reported, citing the case of John R. MacArthur, president, publisher and chief benefactor of Harper's Magazine.

Harper's is a non-profit, and relies on support from the MacArthur foundation, which donated more than US$3 million a year to the publication from 2004 to 2008. However, the foundation's assets have decreased from $34.3 million in 2001 to $12.1 million in 2008. And although those assets could rise again, MacArthur has considered seeking the help of other donors, and last month fired the magazine's editor, Roger D. Hodge. One editor told The Times "there is a sense that there is only one authority to appeal to."

Meanwhile, "Some editors say they worry Mr. MacArthur's reach is extending: he told editors to come directly to him to get manuscript money approved for big pieces, for instance," the article stated.

But where will the next generation of media-supporting billionaires come from? It's a big question, and the answer may be there are none. The digital landscape has changed the point of entry into media, and today "the loudest new players ... have no use at all for billionaire benefactors," Dumenco stated.

Image: Psychology Today