Will More Local Newspapers Go Nonprofit?

By Robinson Meyer
The Atlantic City Lab

Last week, three of Philadelphia’s most important journalistic resources—its legendary daily newspaper, the Inquirer; its accomplished tabloid, the Daily News; and its main news website, Philly.com—took the first step toward becoming nonprofits.

In a complicated transaction, their owner, H.F. “Gerry” Lenfest, donated them to the Philadelphia Foundation, the city’s main philanthropic organization. Specifically, he donated the Philadelphia Media Network—which owns the papers and the site—to a new subsidiary of the foundation, called the Institute for Journalism in New Media. He also established a $20 million endowment for the new institute.“Of all the things I’ve done, this is the most important,” Lenfest told Philly.com. “Because of the journalism.”

It’s the first time since the 1970s that a major metropolitan daily has attempted to switch to nonprofit status, and thus the first attempted transition since the advent of the Internet. In the last decade, many people have hoped that journalism, especially local journalism, could survive the web’s erosion of old print-based profits by abandoning the pretense of profit generation in the first place. Instead of living off dwindling subscriptions and ad budgets, newspapers could capitalize on the largesse of local and national donors.

In that light, The Philadelphia Inquirer and its kin can seem like a sign of what’s to come. Will other papers follow them down the nonprofit path?It depends, in part, on what happens next.

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