Internet start-ups are challenging the traditional separation between advertising and editorial, between fundraising and content production, in ways big media companies could never have gotten away with.

Still, in the face of the media industry's financial conundrum, is this wall about to come down? Should it?

'If journalists had to fundraise in the same way as NGOs, wouldn't that also make them more accountable to their readers?,' asked Astrid Schmeltzer Dybkjaer recently in an op-ed on Information.dk (via Journalisten.dk).

The old way broke, what now?

As inspiration, she cited how the folks behind the podcast This American Life, who are actively soliciting listeners for donations, goes about financing their work. Among internet start-ups this, and other "new" ways of raising money, are not so unusual, but will we eventually see mainstream media in desperation adopt such fundraising methods as well? Could they possibly do so without losing their credibility? Or could it be that they actually don't have any credibility to loose in this respect?

"To all those saying 'sorry I'm just a journalist, I don't sell advertising' I say: tough: that's the way it is now. We tried it the other way and it broke," said former Birmingham Post editor Marc Reeves in his keynote to Journalism.co.uk's excellent Newsrewired-event late June. Reeves, who is currently the editor of internet start-up BusinessDesk.com West Midlands, went on to say:

"That artificial divide we created when we put the noisy people in a room marked 'advertising' and the studious types in another labelled 'editorial' was the biggest mistake newspapers and other media ever made. It allowed journalists to insulate themselves from the business they were in to the point of revelling in their detachment. I've worked with generations of hacks to whom the very idea of passing on a sales lead was regarded as a murderous betrayal of the memory of CP Scott. No wonder so many didn't see the meltdown coming.

"And to those who say: "I can't sell advertising", I ask how many death knocks have you done? Exactly, so don't tell me you can't sell a little ad space."

His keynote received standing ovations. It was indeed a very interesting talk, well delivered - do read it in full here if you haven't already - but I was reminded of Mecom-boss David Montgomery telling the Norwegian Journalist union (NJ) that all journalists are salesmen back in 2007, and I can promise you it was far from well received. Here's an excerpt of my transcript from the latter event:

Newspapers to sell lingerie and wine

Montgomery: "I'm here because I think journalists will have to change. The old fashioned model of print cannot sustain itself... If we don't change radically, and I do mean radically, it will be bad for print, bad for democracy, bad across the board."

The guy moderating the debate (I think this might have been IJ's Gunnar Bodahl Johansen) quotes Mecom's preliminary results which states that Mecom will use proven UK techniques to improve its business. He asks Montgomery which techniques this refers to, to which Montgomery answers "partly marketing techniques" and talks of the importance of convergence. The moderator then says that another technique might be mixing journalism with commercial endeavours. He says there is much concern in Norway that Mecom will force its newspapers to do so, and highlights how Montgomery has proposed that newspapers will sell commercial products like books, wine, lingerie and DVDs.

Montgomery: "We have to have deeper and wider relationship with our readers. One person, one paper is not a good business model for us. In Drammen we have introduced a ticket service, which enriches the service for the community."

Montgomery: "journalists are salesmen"

Ann Margit Austenå (NJ-leader at the time): "Montgomery likes to present himself as a journalist and a publisher, but I see him mainly as a salesman. Mixing commercial and editorial operations will diminish the credibility of the product. A journalist wouldn't do that, but a salesman would.

Montgomery: "Thanks for the compliment. I'm not at all shy about being called a salesman, Every journalist is a salesperson: to convey information, to sell information to the public – it is a special skill. If you're not a salesman in journalism, then what are you?

Ann Margit Austenå vehemently denied that journalists saw themselves that way and the debate went on along similar lines. So Norwegian union representatives definitely do not see themselves as salespeople, and I doubt that will have changed much since this debate took place. In fact, if you get more than 50 per cent of your income from other things than journalism, such as PR and marketing, you are not eligible to be a member of the Norwegian Journalist Union and there have been cases where people who wanted a union membership have been rejected because their job had commercial and/or PR tasks assigned to it.

Also, the code of conduct Norwegian media has agreed to uphold asks that members of the press reject any attempt to tear down the wall between advertising and editorial.

Start-ups vs. media conglomerates

Ethical codes aside, I can't really see journalists of any stripes embrace fundraising or advertisement sales as part of their jobs, or am I overlooking something?

As someone who's co-founded three fully or partly advertisement-funded publications in my student days I've done my share of selling ads, negotiating deals with printers and most other tasks connected to publishing, but being start-ups we didn't have much choice in the matter. We simply didn't have enough hands to afford to be picky about which tasks we would like to do or not.

That said, we didn't write about our advertisers either, but, at least at two of those publications, I don't think we gave much thought to any potential ethical dilemmas of selling ads and writing articles for the same magazines. It is perhaps unjust of me to compare student publications with "proper" start-ups, but I think being a start-up puts you in a unique position - and multi-tasking in this way is just a matter of necessity.

Start-ups can get away with this, and even be praised for it, but would be an entirely different matter if say News Corp or Mecom would start requiring its journalists to sell ads or sponsorship. Can't you just picture the outrage?

Serving the niche

Of course, so far I've not addressed Reeves' thoughts on serving a niche, which are key to his argument. In his words:

"If serving a niche, you have to abandon the old editorial - advertising divisions of traditional media. You've got to understand and relate to your audience in totality because it's more likely that your reader and your advertiser is one and the same person. That's the nature of a niche - it's a concentration down on to a specific interest, whether it's a hobby, a business interest or a tiny geographical area."

In his keynote, Reeves argued that building relationships with the community you serve is absolutely crucial when serving a niche as BusinessDesk.com does. That, of course, is an argument you could easily extend to a company like Mecom, at least in Norway where it owns a large group of regional and local newspapers in addition to a number of specialist websites.

Mecom's approach has been to centralise advertisement sales, an approach I've often heard Mecom journalists at smaller local titles express concern about as they fear it will estrange local advertisers such as the local plumber or mechanic.

Hyper local journalist-photographer cum ad salesman

I remember Rick Waghorn, the former journalist turned journalism entrepreneur, argued that when media pundit Roy Greenslade took up his role as a hyper local blogger for The Brighton Argus he should also have secured an ad from the newsagent he wrote his first post about.

"...if Roy had been empowered to walk out of that door with not only his first hyper-local news story in the bag and a picture on his Mrs’ mobile, but also his first hyper-local advertiser sorted for a fiver a week, then I think we all might be slightly richer for the experience...And, yes, it might only have been a tiny step in the right direction... But it would still be one, tiny step towards our ultimate goal of delivering a sustainable hyper-local news platform for the people of this country," he wrote.

Now, transfer that to Argus-owner Newsquest, or to Mecom or News Corp for that matter: it's just not going to happen, is it? The journalist union wouldn't allow it for one, and in many countries it would be able to block any such attempts.

So in mainstream news organizations we're seeing the traditional separation between advertisement and editorial being challenged in different, more subtle, ways instead.

A Porous Wall

In an article entitled "A Porous Wall" in American Journalism Review last year Natalie Pompilio asked if credibility takes a hit when news organizations, in their struggle to survive, blur the line between editorial and advertising.

Among other sources, she quoted Skip Foster, "a former editor and now publisher of the Star in Shelby, North Carolina" who said "a different game is afoot when marketing and advertising decisions directly affect the number of newsroom bodies left to cover the news.

"If somebody comes to us willing to pay the premium rate to do something that doesn't fit into my initial set of standards, I'll listen," he said. "We're not going to do anything that's masquerading as news, but the rest is gray."

The article is worth reading in full and describes a number of "missteps" by big newspapers which did indeed blur, if not distort, the lines between advertising and editorial. It concludes with a quote on 'ethics or not, it's all about survival'.

Desperate people make desperate choices

Personally I think that is looking at the media industry's financial conundrum from a self-defeating perspective. Desperate people, and companies – which we often forget are made up by people – make desperate choices. With all the choice out there today, of course people will be turned off by news sites so cluttered with advertisement that it's almost impossible to read the actual content; with media organisations trying to deceive their readers or asking them to pay to read something which doesn't serve their needs or interests.

Too often media organisations think about business models from the premise that their current conundrum is down to their readers (or their advertisers) not their own products: It's all somebody or something else's fault.

I think it is more a matter of rebuilding trust. And here we come back to credibility of course, another issue I haven't addressed much so far in this post. To be honest I don't think the media has that much credibility to lose. Certainly, as someone who's had stints working both as a citizen journalism editor and a moderator, my experience, as I noted in this post, is that the people we are supposed to serve, our readers, rarely see us as objective or think we have no political or business ties:

It's all about trust

"They're just not quite sure what those biases which they feel must be dictating the news agenda are, so we often find ourselves accused of being racists and cultural relativists, or socialists and conservatives in the comment section of the same article."

I'm reminded of JP Rangaswami's old but excellent post on how it's all about trust (which I blogged about here):

"Trust used to be something that bound small groups together. Over time we tried to scale trust. It didn’t scale. And what happened instead was Big Everything. In an Assembly-Line meets Broadcast world. Big Everything broke trust. Big Media lied. Big Content Producer reduced our choices. Big Pipe and Big Device reduced it further. Big Firm wrongsized away. And Big Government did what it liked.

"Now, with the web and with communities and with social software and with the inheritance of Moore and Metcalfe, we’ve had a chance to rebuild trust. And we’re rebuilding trust. Slowly. Putting the shattered pieces together. Disaggregation, to be followed by reaggregation over time..." (do check out the full post)

I think the question is more one of how we can use all the new tools the web offers to rebuild that trust most effectively, which again comes down to actually serving our readers who, for the niche publication, may also be our advertisers. It gets complicated. Or does it? Haven't journalists always been forced to make difficult editorial and ethical choices every day? But let's at least start to be transparent about these choices, I think that's a good, and much overdue, start...