How the blockchain could save journalism’s business model

A Brooklyn startup, Civil, is trying to make micropayments happen via smart contracts.

Carvertise cofounder Mac Nagaswami (right) and his mentor, Bill Swain.

(Courtesy photo)

It starts with the idea that news is content worth paying for, a premise that, in the past decade at least, would seem unconventional.

Civil is a Brooklyn-based startup that plans to build newsrooms built on the blockchain. Those who pay to read would act as publishers, those who write would get paid per article, and those who edit would get paid per fact-check. Everything stripped down, everything decentralized.

“We’re still very much in our primordial ooze phase,” Civil founder Matthew Iles said by phone recently. An “unlimited unbundling of the news.”

Civil founder Matthew Iles.

Civil founder Matthew Iles. (Courtesy photo)

Iles is still uncertain what the eventual product will look like. He envisions Civil newsrooms, with their own subscribers and writers, paying automatically for content via smart contracts with Civil blockchain tokens.

“Imagine Brooklyn,” he said. “There are a number of people who might want to contribute Civil tokens to the coverage of local Brooklyn news. People would pool their tokens into a Brooklyn newsroom which would be a fund for Brooklyn news. This would draw a commensurate interest in people looking to offer news-gathering.”

Sounds simple. People want a product, they pay for it, and those who are willing to produce it at that price make it. Except that that hasn’t worked in recent years. When everything got moved online and you didn’t need a delivery truck to come to your neighborhood and throw a paper on your stoop to get the news of the previous day, people stopped paying for it. Media companies ran, screaming from subscriber models, opting for megaclick ad-based models, or settling into niches and funding with events or trips or something people have to pay for that’s not strictly their articles.

Iles thinks we’re coming to the end of all that. He looks at Netflix and Spotify and Apple Music.

“In nearly every area of media, consumer taste has come back up to paying for content,” he said. “We’re beginning to see a correction to the mean. I think people realize that news is valuable and we’re starting to see consumer behavior shift.”

And so Iles thinks he can build the tools, the infrastructure, to bring a new media landscape into existence. It would exist on the blockchain so that writers could be paid automatically with smart contracts and so that readers could govern the publication on their own.

Iles’s career has been in marketing and analytics, but he studied journalism as an undergraduate at Duke and has always cared about it. For Civil, he’s partnered with Tom McGeveran, a former editor who cofounded Capital New York in 2010 and led it to an acquisition by Politico in 2013. (McGeveran and fellow Capital New York cofounder Josh Benson left Politico in January 2017.) The pair are looking to start with a fleet of 75 to 150 participating journalists. In a blog post, Iles says he hopes to raise $2.5 million by the planned November start date. He hopes to do this through traditional venture investing rather than through an initial coin offering or ICO.

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