Editorial expenses (55 percent) remained the largest budget item in 2013 and have grown slightly in proportion to total expenses since 2011. Editorial expenses account for over half of total costs for 70 percent of the organizations. Meanwhile, general and administrative costs (14 percent) have declined as a share of total expenses, perhaps because they are fixed costs which now make up a smaller percent of total budgets which have grown.

Organizations whose budget exceeded $500,000 allocated a larger share of their expenses to marketing and development and to technology. It’s possible that while organizations are smaller, they invest primarily in content production, and it is not until reaching a certain size that they feel positioned to invest more heavily in “future-oriented” core competencies and functions.

As news organizations grow, they also tend to hire more full-time employees and use fewer part-timers and freelancers. Across the local, state and regional news organizations in the study, part-timers and freelancers constitute about 60 percent of staff. In contrast, at national news organizations, which tend to be larger, 85 percent of their staffs are full-time employees.

Sharing Costs through

Cost-saving measures are helping sites run their operations as lean as possible. Several sites have used partnerships in innovative ways that help them to share costs on the editorial/production process.

New England Center for Investigative Reporting (NECIR) has a partnership with WGBH in Boston in which the radio station covers a number of editorial and marketing expenses in exchange for access to the content the center generates. The radio station pays for one of the center’s full-time reporters, half of the salary of an editor, and half of the cost of a freelance Web producer, as well as providing office space. In addition, WGBH works with the center on four co-branded live events per year, providing marketing, logistics, event space and food; WGBH and the center split profits from the events. Finally, WGBH promotes the center on the air, including running ads for its summer training programs. The value of WGBH’s contributions to the center amounts to nearly $300,000 annually.

Charlottesville Tomorrow develops content with The Daily Progress, a local for-profit newspaper in Charlottesville. In exchange it receives free use of the Daily Progress printing press for a yearly voter guide, free advertising in the newspaper’s pages and on its website, and free marketing for its events. The two organizations plan their content together to make sure there’s no overlap in their stories. No money changes hands in this partnership, and Charlottesville Tomorrow prefers it that way.

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