Civil’s Bold Plan for the News Crisis: ‘Flip the Business Model on Its Head’

Quality journalism—most especially at the local level—is in a crisis so deep and broad that its very survival has become a boldface question mark. Publishers are reacting mostly by tweaking their failing business models.

The answer is not more tweaks, says Matthew Iles, CEO and co-founder of the new platform Civil. It’s “flipping the incentive model on its head. We need a radical new business model or we will see journalism eradicated.”

In this Q&A, Matt Coolidge, head of marketing and a co-founder at Civil, explains how this “new economy for journalism” oriented around unifying publishers and their audiences is working to flip the business model for news through such innovative approaches as blockchain technology.

Sept. 18 is Civil’s big day. What’s happening?

It’s a milestone for us—it’s the date that our token sale goes live. That will represent the act of “decentralizing the network” —or to put it another way, when the Civil Media Company, which invented this platform and underlying technology called Civil, will officially hand control of the network over to a global community of participants who hold CVL tokens.

CVL tokens are how you will make your voice heard and engage in different transactions across the Civil economy, from voting on community governance, to supporting journalists via peer-to-peer payments that allow them to capture 100% of the value they create, to launching or sponsoring the launch of a newsroom.

Currently, you can pre-register for the sale. (Those interested in doing so should go to civil.co to learn more about the process.)

What’s really exciting about this is that we expect Civil to be the first time many people have interacted with blockchain-based technology — which is explained by a “non-blockchain-y person” here. If this grand social experiment—a community, not a hedge fund or media holding company, will control the distribution model—succeeds, it will be because we’ve attracted a global community of people who come because they care about journalism, and they want to help promote a better way forward for the industry.

Civil is built to be an active, participatory network. If you’re simply looking for the “next Bitcoin,” you should look elsewhere. This is about rethinking the incentive structure that drives journalism and creating a model that rewards quality, not quantity. We’re able to create such a system for journalism by applying blockchain and cryptoeconomics so that producing ethical journalism based on a clear, transparent ruleset is the primary incentive—and is what will propel the network’s growth.

You see a global community of “civically engaged individuals”—“Citizens” in Civil’s definition—who, through the power of their CVL tokens, will create a “hub for quality, sustainable journalism.” What’s the basis for this confidence when newsrooms everywhere are encountering very mixed results in convincing readers to pay for just this kind of journalism?

At the highest level, we think it’s about reimagining the incentives that lead people to pay for journalism. We are creating a network of independent newsrooms, all of which will be underpinned by the same, universal journalism ethics policy, and we are empowering the entire economy—journalists, readers/supporters, developers, etc.—to play an active role in its governance and evolution. If you want something to change on Civil, you have the power to make it happen. No single entity, not even the Civil Media Company itself, can unilaterally enforce a policy change across the network, à la Facebook, Twitter, or other popular media distribution platforms.

We want people to come to Civil for ideological purposes—because journalism matters, and it needs to be supported. On top of that, though, we’re creating economic incentives, where taking actions that promote ethical journalism on Civil can lead to economic rewards via CVL. Much more context on that front can be found in our CEO’s post from last Friday.

We’re building an economy. We’re not a publisher ourselves but rather a platform that unites many independent news outlets, all of whom adhere to the same, transparent code of journalistic ethics (the Civil Constitution) that allows those who write/record/design/develop journalism to capture 100% of the value they create.

To put this in greater perspective, consider Civil’s competitive landscape. We have no interest in “competing” with publishers. We hope existing publications, assuming they meet the standards outlined in our Constitution, will consider publishing on Civil. We want to attract those who are fed up with Facebook, Twitter, and YouTube’s inability to consistently or effectively enforce ethical journalism standards on their respective platforms.

If we can prove our ability to be a platform that’s truly capable of serving ethical journalism, and keeping bad actors off, we can absolutely build such a global community and [do so] in relatively short order.

Civil emphasizes the importance of its initial network consisting of “mission-aligned’ participants. What are you doing to ensure that will happen?

We’re doing that in two ways:

The first is through our token sale that begins Sept. 18. We’re selling CVL as a consumer token, an emerging framework meant to ensure utility-specific tokens are responsibly designed and distributed. To buy CVL, you must verify your identity, prove that you know how to responsibly purchase and store cryptocurrency, and that you understand how CVL works and intend to use it for its stated purpose.

It’s critically important to ensure we attract people who truly wish to participate in this network versus those who want to buy CVL for purely speculative purposes. We’re explicitly prohibiting speculators from buying CVL. These standards will remain in place for at least the first 12 months of Civil, so it won’t be possible for somebody who wants to speculate to simply wait until the token sale is over and then try to buy CVL on the secondary market.

The second way is we’re ensuring we’ll meet our network goals is we’ve reserved a significant portion of CVL, 33 million of the maximum total of 100 million CVL tokens, for selling/gifting to mission-aligned partners. Think: journalism organizations and nonprofits who want to be part of the network, as well as developers who will come on to help build additional apps/tools/services for the community. (Read the “direct monetization” portion of this post, about our own business model, for more context on that front.) You can view some of our initial partners here. We just announced a major collaboration with the Associated Press around blockchain-based content licensing.

If Civil works as you envision it, will news publishers, especially at the local level, no longer have to depend on Facebook and Google for traffic? Will their own digital real estate become their new “center of gravity”?

That is absolutely our goal. It’s an ambitious one to be sure, but Civil is committed to returning the power back to journalists and letting them be less reliant on paying tech platforms to distribute / amplify their content. That’s the major reason that The Civil Media Company is not—and will never—take any transaction fees from reader-newsrooms payments. We believe those who create content should be able to capture 100% of the value they create.

Since Civil will not benefit from how quality journalism is funded, how does it sustain itself?

The short answer is that we plan to build an “app store model” where we will retain transactional cuts of apps/tools/services that are sold/run on Civil. (See this link for more information.)

How many news organizations, especially local ones, have come to Civil with serious proposals for partnerships?

The process doesn’t officially open until the platform launches in October, but we’ve already received well over 500 such inquiries.

If Civil’s “radical new business model” works with its initial “First Fleet Newsrooms,” how soon do you see it making significant progress in redefining how news is produced, consumed, and financed everywhere?

This is a tough question to answer in a limited space! We hope to support hundreds of newsrooms—and more importantly, see them reach sustainability—within the first year. But “significant progress in redefining how news is produced, consumed, and financed” is a major challenge and one that I think we’ll be focused on for years to come.

Tom Grubisich (@TomGrubisich) has written “The New News” column for Street Fight since 2011. He is also working on a book about the history, present, and future of Charleston, S.C.