Journalism can also be a good investment

Of course, the fact that only companies which have managed to grow are listed could be seen as a shortcoming. This is known as ‘survivor bias’: it can lead to decisions being made on the basis of incomplete data relating only to those cases that have ‘survived’ a selection process.

However, Erdelyi explains, there are several reasons why this limitation does not negate the value and purpose of the research. ‘We acknowledge the survivor bias present in this work, and an entire chapter is devoted to start-ups that fail. The problem with focusing solely on the difficulties, however, is that whilst you might secure some donations or win a few grants, investments require stories of opportunity. Above all, we wanted to show that success is still possible.”

Success, at a time of enormous change in the media sector, seems to come about in many different ways, often all at once. “I think that perhaps in ten years’ time, many news organisations will operate more like ‘talent agencies’, in which the editorial team or the publisher will have different roles. I think we need to keep an open mind about what constitutes a multimedia company and what journalism is,” comments Erdelyi.

This is a view shared by Turi Munthe, an entrepreneur and investor in the media sector who contributed to the report. In his analysis, Munthe highlights how the latest developments in the internet, particularly artificial intelligence, are already having a devastating impact on advertising and traffic.

As with any major change, however, this will also open up new opportunities. “It creates space for young people to set up their own publications and products – be they podcast networks, teams of content creators, or whatever,” explains Munthe. “Journalism will be practised differently and will have much more diverse revenue streams. As a media investor, I used to joke that I wouldn’t look at a news organisation that didn’t have at least seven different sources of revenue.”

Of the ‘survivors’ analysed in the study, only one is Italian: Will Media, a social media-native platform founded in 2020. ‘Actually, I don’t want to single out Italia as an exception,’ comments Munthe, ‘in the world of media start-ups, there are plenty here too. There’s a tendency to always say that this country doesn’t work, that we aren’t modern, that we aren’t contemporary. The truth is that the sector is buzzing pretty much everywhere.”

One aspect, however, that sets the Italian market apart from that of other countries – particularly in Central and Northern Europe – is the public’s reluctance to pay for a news subscription. Almost all the businesses analysed in the Centre for Sustainable Media’s study have managed to generate a substantial proportion of their revenue from subscription schemes, and the only Italian organisation considered here is an exception to this trend.

“There are still some challenges in this regard,” admits Munthe, “but almost everyone is working on it.” The changes in the market over recent years are forcing even the most traditional and established organisations to contend with new formats, new media companies, content creators and independent publications. To adapt and continue to thrive, the report’s findings may offer some guidance.

“Medium-sized publications, in particular, are in the most precarious position,” says Munthe. “Those who, in addition to editorial content, manage to build communities will survive.” ‘Community’ is a word that comes up often. A bond to be forged with the public, a sense of accountability within newsrooms, a new relationship between the media and users. A roadmap to be followed, both by start-up media organisations and those already in existence, because the promise of quality journalism also depends on financial sustainability. The message is clear: it’s not easy, it takes patience, but it can be done.