Media: National Public Radio's Digital Makeover

As senior vice president and general manager of the NYTimes.com, Vivian Schiller presided over one of the industry's best-read Web sites. But six months ago, Schiller stunned media watchers when she defected from the financially troubled Times to become CEO of National Public Radio. With the relaunch of NPR.org, today is a kind of coming-out party for Schiller. The renovated Web site, featuring a cleaner look and easier navigation—is the linchpin, she explained to NEWSWEEK last week, of a strategy to transform NPR into the No. 1 destination for free news on and beyond the radio. "We have to be a multiplatform play," she said. For Schiller, that means building on NPR's reputation as a broadcaster of national and international news, by extending its reach into local news. She plans on relying more on local member stations to fill what she sees as a "scary" void in local coverage as hometown daily newspapers fold.

Schiller spoke to NEWSWEEK's Johnnie L. Roberts about why newspapers shouldn't become not-for-profit ventures, why she believes its' "delusional" to charge readers for online news, and the "slippery slope" that the Times would embark upon were it to seek philanthropic support for news-gathering. Excerpts:

Why was it necessary to relaunch NPR.org?
This is an organization that's in transformation into becoming a fully functional news content organization, not just a radio company. As part of that, we've been training our journalists to become multiplatform journalists, not only radio—not that radio is not important to our core. We have been adding more and more content to our Web site to make it a much richer experience, not just a companion for radio, but a destination in its own right. When we launch, it'll be a much friendlier destination that allows you to find what you're looking for.

Does your emphasis on the Web risk overshadowing radio?
Radio is our core, our heart and soul. It's where most of our audience is. But we have to make sure that we serve the audience wherever they want it. Of course, there's traditional radio with massive, massive audience. But where else is audio listening going? We need to own that space. We're the No. 1 most downloaded podcast in news and information.

How will it work? Do you expect listeners to bypass the sites of the local station and come to NRP.org?
In creating all this digital content, it's not just to service NPR.org. We're giving them more digital content that they can pull down and use on their site. One of the major focuses of our digital initiative is to give stations the tools, the resources, the knowledge, and the infrastructure, so they can create a great experience in their communities. The [local] station presence is going to be much more visible on the redesign.

Why all the emphasis on the local stations in connection with the Web site relaunch?
That's where a big void is happening in journalism now. It's the worst at the local level. I'm worried about locals. It's scary. It happens to be where the biggest crisis in journalism is happening. [Take the L.A. Times as an example.] They've closed bureaus all over the world. It's a travesty. We can go market by market. We want to increase the output and platforms on which stations create content in local communities, with a focus on accountability journalism. [Editor's note published July 29: In the first version of this story, Schiller incorrectly stated that the Times had shut down its investigative unit.]

Accountability journalism?
Some people call it investigative journalism. That just to me means so many things. So I narrow it to accountability journalism—being the watchdog for public institutions and public individuals.

So local is simply the biggest opportunity?
The reason that I came to NPR and left other big national news organizations is because NPR has something thoses organizations don't have. In all of public radio, there are 8,000 people spread around the country. They are in every community. [They have a] physical presence and a presence in the hearts of minds of the audience in those communities.

There's a lot of talk in the newspaper industry about the 'NPR model'—the idea of becoming a nonprofit venture as an answer to the financial decline brought on by impact of the Web and by the recession. Is going nonprofit a good idea?
A lot of media pundits have been saying the salvation for commercial media is to become a not for profit. I laugh when I see that. The notion is that you declare yourself not for profit, and poof, all of your problems go away. Well guess what, if you're a not for profit, you still have to raise all the money that you're spending and then some, so you have a surplus when the economy goes off a cliff. It's incredibly naive.

Proponents say, just create an endowment?
Well, in order to create an endowment that's going to fully support the operating budget of a large national-international news organization, that endowment would have to about $8 billion—no exaggeration.

A large national and international news organization like, say, The New York Times? Lately, it has been toying with the notion of philanthropic support for some of its journalism. How would that work?
I suppose that a commercial news organization could continue with their existing revenue streams and ask money from foundations and individuals. Ask for donations, right. The problem is, if I'm a donor, how are you going to explain to me how my money is going to be used when you're giving out dividends to shareholders?

Would a donor, for example, in effect indirectly subsidize the company's payment of 14 percent finance charges on its borrowing from Carlos Slim?
Yes, that's the problem. That's sort of the beauty of a not-for-profit, like ourselves. We're beholden to no one. No financier. Our gifts come with no strings attached, or we won't accept them. Nobody is getting rich off of it. It's a big issue. So then there's a notion, only our foreign coverage will be philanthropic, for instance. In a multiplatform world, you can't separate those things. When they start asking philanthropists for donations, it's a slippery slope and it becomes very very murky.

Surely, The New York Times would disclose all of this?
Yes, the Times is all into transparency. To me, any legitimate, quality enterprise would need to be explaining exactly how the money would be used. And that's what gets into this issue. Is some fraction of that going to pay off debt? Is it going to Carlos Slim? Or another financier, if it's some other newspaper and not The New York Times.

While employed by The New York Times , you helped the newspaper stop charging for online content. Now it's reconsidering. Generally, why do you oppose paying for content?
I am a staunch believer that people will not in large numbers pay for news content online. It's almost like there's mass delusion going on in the industry—They're saying we really really need it, that we didn't put up a pay wall 15 years ago, so let's do it now. In other words, they think that wanting it so badly will automatically actually change the behavior of the audience. The world doesn't work that way. Frankly, if all the news organizations locked pinkies, and said we're all going to put up a big fat pay wall, you know what, more traffic for us. News is a commodity; I'm sorry to say.

But the Times did get people to pay, right?
We far exceeded our expectation—225,000 subscribers paid $50 a year, in addition to the home delivery subscribers, who got all of the Web for free. But guess what, that's $10 million. Instead of 225,000 who pay the $50, let's say it's one million subscribers. OK. That's $50 million a year. That's not going to save any newspaper. It's going to kill your advertising base. The numbers don't work.

What must they do?
I believe the national newspapers are going to be fine. The New York Times and the news site are profitable. There's a misconception that New York Times loses money. It makes a lot of money. For national newspapers like the Times or the Wall Street Journal, there's still a lot of money there. So [the Times is] trying figure out their [debt-repayment] problems. I think they'll have to probably cut more expenses, undoubtedly. They are not going to go under. The quality isn't going to take a nosedive.