Study: In donations, 'citizen journalists' hit a wall

A new study of online start-up financing offers only a glimmer of hope for self-employed reporters like me, trying to make a living as "citizen journalists" through voluntary contributions from readers.

The study by two Belgian university researchers looked at 88 ventures -- including Gannett Blog -- using so-called crowdfunding to generate income. The authors say their work is the first of its kind, although the findings are still preliminary. (Read the full report.)

The ventures studied are in a range of industries, including politics, music and sports. About 16% were devoted to journalism. The authors, Thomas Lambert and Armin Schwienbacher, found that most of the money raised came from donations, and was given in return for a service or product, rather than an ownership stake. Also, non-profits were far more successful than for-profits in hitting crowdfunding goals.

These early results offer hard evidence of the challenges faced by many citizen journalists trying to make money after losing jobs. Overall, for example, non-profits raised about 200% of what they sought. For-profits, on the other hand, raised an amount that can't be expressed in a statistically meaningful way, in terms of success. So, donations are, indeed, a source of income -- but an unreliable one that depends too much on altruism.

Crowdfunding gets its name from the better known crowdsourcing -- where, for example, newspapers use the Internet to appeal for reporting assistance from large numbers of readers (the "crowd").

Donations, to paywalls
The study shows that voluntary donation efforts by newspapers such as the Miami Herald aren't likely to succeed. Indeed, the Herald stopped soliciting donations not long after it started in mid-December. It's clear that we self-employed bloggers will need a more reliable source of income, such as mandatory subscription fees. That's the direction The New York Times is taking early next year.

Newspapers have the resources to develop the sophisticated software to collect those fees. But citizen journalists will find it much tougher, unless popular publishing software like Blogger -- which I use -- starts offering that option.

Lambert and Schwienbacher did their study via an online survey; they're both at the Université catholique de Louvain in Belgium; Schwienbacher is also affiliated with the University of Amsterdam Business School.

And here's my occasional pitch...
I'm not planning mandatory subscriptions. I keep this blog as a public service, and a small source of supplemental income.

I began asking for your donations late last month -- far too late to reach my $4,000 quarterly goal. Still, with less than a week in this quarter, I've raised only $612 in contributions, plus another $139 from advertising. Plus, much of that ad revenue was collected as far back as January. So, if you have a chance, please consider throwing a couple bucks into my virtual tip jar, to keep this blog going. And to those who've already contributed: Thank you, very much!

I'm trying to earn $4,000 quarterly, mostly through sponsorships of $5 per reader, plus limited ad sales. Please use the "Donate" tool in the green rail, upper right. Or mail cash/checks payable to: Jim Hopkins, 584 Castro St. #823, San Francisco, Calif., 94114-2594.