Journalism needs a radically new operating paradigm. Media innovation and consumer behavior trends over the past 20 years have eroded the business model of journalism, leading to shrinking coverage throughout the ecosystem, increasing reliance on an unsympathetic advertising industry, and record-low public trust in mainstream media. However, this same wave of innovation also yielded progress in social networking, global marketplaces, and massively collaborative self-governing systems, including the recent invention and development of blockchain, cryptocurrencies, and cryptoeconomic business models.
We propose a solution called Civil, an Ethereum-based decentralized platform that can be used to create “newsrooms” and “stations” — blockchain-based marketplaces where citizens and journalists form communities around a shared purpose and set of standards, financially support factual reporting and investigative work, and substantially limit misinformation through effective collaborative-editing methods. The net result is a self-sustaining global marketplace for journalism that is free from ads, fake news, and outside influence.
Journalism in the 21st century
Traditionally, journalism relied on a combination of subscription and advertising revenue. The advent of the Internet changed all this. The vertically integrated cost structure (i.e. owning delivery trucks, printing presses) was virtually worthless overnight but still collecting rent. Newspapers lost ownership of the customer relationship as people’s “front page to the world” soon became Google and then Facebook. Consumers developed a deep resistance to paying for any content online, and advertising dollars translated to digital at a fraction of their print prices.
This shift put dramatic pressure on journalism’s traditional business model over the past 20 years. This manifested itself in three distinct ways:
Investigative, niche and local journalism have been hardest hit. Pre-Internet, print newspapers bundled together many areas of coverage (e.g. business, sports, lifestyle) in order to attract larger subscriber bases, then used that larger circulation to charge more for advertising. This self-fulfilling dynamic favored winner-take-most outcomes in the space, with most U.S. cities seeing 1–2 major newspapers and only a handful of “national” brands. This meant the newspaper business typically generated solid profits, and they funded the more expensive investigative and niche work out of these proceeds. But as everything became unbundled, it became harder to justify funding newsdesks at a loss. Local journalism became unsustainable in many places for similar reasons: consumers’ free access to near-infinite choice and Craigslist-like classified sites meant a swift drop in overall revenue without a commensurate decrease in expenses. The result? In 1900, there were more than 500 U.S. cities with 2+ newspapers. In 2017, there are just 10 such cities.
The Internet erased the cost of publishing and distribution, enabling a global rush of new voices (including many amateurs). With consumers spending increasingly more time online yet unwilling to pay for content throughout much of the 21st century, companies that could monetize attention at scale became the predominant business model of the Internet. To stay alive in this clicks-for-cash economy, publishers were aligned to drive as much traffic to their site as possible at all times in order to make their numbers. But because they no longer owned the direct relationship with the reader, they suddenly found themselves having to play by Google’s and then Facebook’s rules. Digital advertising has boomed as an industry, but virtually all the winnings have accrued to the top: Google and Facebook account for nearly 80% of all ad dollars spent online. Everyone else, of which news is just a fraction, is left fighting for the scraps.
Trust in media
Now we find ourselves here: the era of fake news. The decline in trust can be traced to the business model issues above. It started with frustrating but innocent-enough tactics for driving ad revenue at the expense of user experience like slideshow articles, cheap memes and hyperbolic clickbait. It became exacerbated by trolls, algorithmic echo chambers, and viral hackers looking to maliciously sway public opinion or simply get rich quick. “Fake news” originally referred to fraudsters peddling completely false but often emotionally charged stories in the hope it would “go viral” on social media so they could earn ad money from the web traffic back to their site. This all reached a boiling point in the 2016 election and beyond when the phrase soon became a political weapon to cast doubt on any unfavorable news. It all signifies how our deeply divided society no longer shares the same picture of reality: 62% of the public believe the media is biased and 55% believe news organizations are “often inaccurate”.
There is a silver lining in all of this: people are paying for content again, including most recently, the news.
The New York Times and Washington Post have enjoyed significant increases to their subscriber business this year. Niche media is seeing gains too, with outlets like The Marshall Project, The Information and Stratechery growing large, dedicated and paying audiences.
But it’s not enough. Despite Internet-enabled improvements to the free flow of information such as openness, speed and lower costs, we still don’t have a truly Internet-native business model that directly supports journalism’s primary purpose: “to provide citizens with the information they need to be free and self-governing.”
There have been many attempts to address the declining value of news: filtering algorithms to stave off fake news; higher-priced ad units disguised as bonafide content; easily gamed paywalls; as well as government-sponsored and non-profit organizations that understandably choose to avoid the business model problem altogether. However, until a self-sustaining form of funding quality journalism is widely adopted, everyday people will increasingly distrust the government, the media and each other.
Energizing journalism by rewiring how it works
We are building a new operating model for journalism based on three core solutions:
Many of the most successful new companies in the past 20 years are online marketplaces, including eBay, Amazon and Airbnb. Rather than owning the inventory and supply chain, marketplaces excel by rapidly connecting buyers and sellers. The result is a low-overhead, zero-marginal-cost structure that infinitely scales and — this is the most important part! — gets better the more people use it. The “network effect” caused when more customers drives more sellers which drives more customers — all while improving the system’s data-driven tools like ratings and recommendations — is the hallmark of what makes online marketplaces so successful and defensible.
Civil aims to create a marketplace model for journalism where citizens and journalists connect around shared interests and standards. But as discussed above, content marketplaces have suffered unique drawbacks to date. Unlike direct marketplaces between buyers and sellers, content marketplaces primarily monetize with a 3-party system including publishers, consumers and advertisers. Unlike physical goods and services, content is relatively inexpensive to create (even copy). These facts make it possible for anonymous black hats to cheaply produce and spread fake, malicious content in pursuit of clicks-for-cash ad dollars or nefarious propagandist aims. Therefore, we need to design a marketplace system that’s both open and ethical.
The Internet is also famous for its acts of mass collaboration, notably Wikipedia, Linux and open-source in general. These mostly volunteer organizations have harnessed global workforces orders of magnitude larger than any corporation often yielding remarkably high-quality and rapid results. Notably, traditional management structures break down in these organizations not only because of the sheer scale and complexity but also because contributors are more motivated by passion, autonomy and social forces. The best examples are known for their strong culture where members exhibit a deep sense of personal responsibility for the organization’s mission, values and overall health.
Civil aims to design a fair, flexible and open governance system in the image of our journalistic purpose that will guide the inner-workings of our news marketplace ecosystem. However, this approach is not without its pitfalls too. Lack of voter participation and unexpected concentration of power can bring swift ends to once promising, even well-intentioned governance projects. Where there are incentives, especially economic as in our model, there’s risk of tampering as people try to game the system for financial gain at the expense of the network. Therefore, it’s imperative our marketplace-governance system is equipped to incentivize journalism and very little else.
Recent years saw the emergence of a technology collectively termed blockchain. At the core of the innovation is “trustless finality”, the system’s ability to globally record and distribute data updates without relying on a trusted centralized entity. The first such network, Bitcoin, came online in 2009. It demonstrated that trustless finality (based, in Bitcoin’s case, on a “proof-of-work mining” algorithm) allows the creation of scarce, digital assets (i.e. cryptocurrencies and tokens) that have economic value and can be transferred in a global peer-to-peer exchange without requiring centralized issuance or enforcement.
Cryptocurrencies enable organizations to design cryptoeconomic business models where desired activity is incentivized and undesirable activity is penalized in a fully decentralized, community-operated way. Civil is looking to create just such a model for journalism. It will promote and reward originality and accuracy while enabling journalists to earn a stable living reporting on issues they feel passionate about, all without resorting to ad-based monetization. At the basis of our economy is the Civil token (designated as CVL). With the advent of blockchain-based decentralization, we intend to create a fair and stable news marketplace free of manipulation and misaligned incentives.
Civil: Self-Sustaining Journalism
The intent of Civil is to create a mesh network of self-governing news marketplaces where newsmaking, fact-checking and platform sustainability are economically rewarded. The result is a completely unbundled and decentralized news ecosystem where simultaneously anyone can create, contribute and support only what they want, and where trolling, echo chambers and misinformation are economically infeasible.
Newsrooms, Stations & Fact-Checking-As-A-Service
At Civil, we believe we need to design and bootstrap three different marketplace models that interconnect within our broader ecosystem. We cover them each at a high level for context, then dive deeper into the inner workings of each later on.
Newsrooms allow citizens to pool funding to support coverage for a specific topic. The more citizens, the more funding, the more journalists will be drawn to cover it. In this way, Newsrooms efficiently enable coverage of niche and local topics while scaling up to serve nationally and globally popular topics as well.
Stations allow journalists to productize and price their work to their own dedicated audience however they want, from recurring tips (think: Patreon) to major projects (think: Kickstarter). Stations give journalists a turnkey and autonomous way to monetize a loyal community.
Fact-checking allows citizens and journalists to collaborate on improving the quality of reporting by harnessing the power of the community. This same system also prevents libel, plagiarism, falsehoods, misinformation and simple errors from spreading unfettered throughout the network, and facilitates Civil’s commitment to helping citizens become more knowledgeable consumers of news media.
Cryptoeconomics: Introducing The CVL Token
Fundamentally, citizens will join Civil because they want to engage with good journalism, and the CVL token is their key. In this section, we summarize the ways in which we envision the CVL token used throughout the network both by citizens as well as journalists.
Because Civil is predominantly a two-sided marketplace with recurring fees for access and participation, the demand on CVL tokens is likely to compound as the network grows because even early members will need to continue ‘re-upping’ their holdings. Meanwhile, journalists (especially full-timers) will most likely look to sell their CVL tokens in exchange for fiat in order to fund their livelihoods. Therefore, we expect the typical CVL token to experience high velocity throughout the system. We will not employ an inflationary aspect to the currency, but instead distribute a fixed amount over time — some at our upcoming token launch later this year, the rest at a later date. Even as the price of CVL tokens fluctuates, we expect Newsrooms and Stations to dynamically adjust their pricing to optimize their member acquisition and retention goals.
Newsrooms: Competition, Banks & Governance
Newsrooms are driven by what citizens want to know. Citizens pool their CVL tokens to support coverage for a specific topic: the more citizens, the more funding, the more journalists will be drawn to cover it. Not only does this efficiently enable chartered news marketplaces to spring up organically in response to demand, but also allows for a healthy dose of competition between journalists as well.
Civil is founded on the belief that the best way for citizens to form their own conclusions about a given topic is to shine an array of diverse (and accurate) perspectives on it. We call this approach “floodlighting,” and it will be written into every Newsroom’s governance in order to guide the journalist admission process and content recommendation algorithms so citizens see content they’re both likely to support and oppose. We believe this will mitigate the echo chamber effect so prevalent in today’s Internet media.
Journalists must apply to join a Newsroom, and its members vote to accept or reject. Once accepted, journalists automatically and evenly split some guaranteed minimum distribution of the overall token pool, as determined by the Newsroom governance. Beyond that, Newsroom members may distribute additional tokens however they want among the Newsroom’s journalists, presumably based on merit.
In this way, Newsrooms also act as a programmable bank thanks to Civil’s underlying blockchain technology. Citizens and journalists enter into smart contracts together determined by their collective governance decisions in order to collect, distribute and track all token payments throughout the Newsroom in a trustless and transparent way without any centralized entity.
This section shows how we mean Newsrooms (as well as Stations and Fact-Checking-as-a-Service) are self-governed. With input from the community, Civil will draft a Constitution that governs its network-wide ethics, enforcement and operations. The goal is to grant the ecosystem as much freedom as possible to blossom into whatever it wants to become while ensuring just enough rules to maintain cohesion and civility. While every Newsroom and Station will share the same foundational constitution, each individual Newsroom and Station are distinguished by its unique charter, which supporting members create and maintain with 100% autonomy.
Stations: Dedicated Perspectives
Stations are driven by what journalists want to report. Journalists write their own Station’s charter, articulating both their journalistic focus as well as their products and pricing. Journalists may charge a recurring fee for a weekly column, raise money in advance of a large project, both at the same time, and more. They are their own shopkeeper, successful only insofar as their ability to attract and retain paying citizens.
We imagine the most successful journalists on Civil will stand out for their larger-than-average Station business. Journalists may view Newsrooms as highly competitive, somewhat uncertain financial opportunities, but terrific outlets for attracting new supporters to their Station. Indeed, Newsroom activity should help fuel Station growth.
Because journalists must be practicing in one or more Newsrooms to start a Station, Stations are thought to “launch” out of associated or relevant Newsrooms. These linkages may drive many network-wide insights and benefits, but at least one is fact-checking support. Just like Newsrooms, Stations must allocate a portion of funding to fact-checking. Running a Station is a privilege on Civil, and this arrangement ensures our accuracy standards are maintained throughout the network.
Civil believes independent fact-checking is an essential element of great journalism, which is why so many publications make fact-checking a permanent part of their newsrooms through a research desk or copy desk. With “fake news” lighting up our lexicon, Civil intends to harness the power of our community to bring aggressive and transparent fact-checking to the network through a collaborative, marketplace solution using CVL tokens that maintains our commitment to decentralization, accuracy and news literacy. Of course, our system must be designed to prevent or penalize bad acts and actors (plagiarists, fake news generators, etc.), but our primary orientation is that journalists and fact-checkers are collaborators rather than antagonists.
“The market cap of the protocol always grows faster than the combined value of the applications built on top, since the success of the application layer drives further speculation at the protocol layer.” — Joel Monegro, USV
Civil will open-source much of its codebase and also create API endpoints in order to build both proprietary and third-party applications on top of its protocol. We envision both non-profit and for-profit opportunities above and beyond the core cryptoeconomy expressed above. Such applications we’ve begun to imagine include:
Capturing content directly into Civil could prove originality and even veracity for such things as location and time. We see ourselves supporting all media including text, graphics, photography, video, audio, data and software, so the variety of input apps possible is equally diverse. We also see existing content needing to be ‘pulled’ into Civil, especially primary documents and key sourcing material, thus creating a library of searchable references for journalists to cite with confidence in their veracity.
Civil is a social network and cryptoeconomic marketplace in one, and communication applications will be key to our fulfilling that purpose. From community forums and public chat experiences like Reddit or Slack, to one-on-one, encrypted messaging for sensitive scenarios like whistleblowing and anonymous sources, enabling the Civil community at large to communicate effectively will be key to our long-term success.
Polling & Analytics
We are incredibly bullish about Civil’s ability to unlock a new future for public opinion polling, and this is just one of our many data-driven possibilities. Other valuable applications will provide journalists with real-time performance dashboards on their content, community and finances. Still others may use machine learning to create improved recommendation algorithms or other valuable connections throughout our network.
We imagine piecemeal newsmaking services springing up on Civil such as fact-checking, reporting, editing, writing, photography, videography, data analysis and visualizations, software development and graphic design for journalists to hire for one-off projects or form long-term relationships. We even see more operational services such as legal counsel and pricing optimization possibly taking hold.
There may not be one preferred way to consume Civil content, but instead several. Whether newsletter digests, mobile feeds, push notifications or voice interaction, our members will want and need to consume Civil content in a variety of ways known and still unknown. Even a browser extension that lets you know whether you’re viewing Civil-approved content somewhere else online could be valuable. We expect to see several different popular applications in this specific space over time.
Roadmap: Let’s change the world
We are becoming technically capable of creating a global, cooperative economy for vetted information and civil debate. Now we just need the will to do it. We started Civil because we believe we can build a self-sustaining, decentralized system for addressing journalism’s thorniest problems as long as we commit to working together toward a common cause.
The next significant milestone in our roadmap is launching our CVL tokens in the next few months. Here’s how we’re going to get there:
Grow our community
Civil needs to grow a large, diverse and collaborative community of journalists and engaged citizens in order to succeed.
- Journalists: Apply to become of our First Fleet, the first journalists granted access to participate on Civil.
- Engaged citizens: Join the conversation on our mailing list, Slack, Twitter, and here on Medium. Be the first to hear details about our upcoming token launch and how you can participate.
We will hold open discussions with our community about 1) the elements of journalism Civil must hold dear, 2) the advent of cryptoeconomic business models, and 3) building a decentralization organization. Join us!
Now that we have a better idea what Civil needs to do, it’s time to build it. Our team will be focused on 3 key areas over the next few months:
- Cryptoeconomics — Although we believe the foundation is laid out well here, we still need to do deep-diving on how certain specifics will work and fit together.
- Smart contracts — We are seeking engineers skilled and knowledgeable in smart contract development. Go here to learn more about this and other engineering roles currently open.
- Product design — We are seeking product designers skilled and knowledgeable in highly intuitive user experience. Go here to learn more about this and other design roles currently open.
We want to reach certain goals prior to our CVL token launch:
- 10,000 community members across email and Slack,
- 100 First Fleet journalists committed to 12–24 inaugural newsrooms,
- Completed prototype that everyone can use.
Team & Acknowledgements
Matthew Iles is the founder of Civil, leading strategy, product and team-building. He studied journalism at Duke University before an 8-year career in digital marketing and startup entrepreneurship. He believes journalism is core to a healthy society, but that legacy business models are holding it back. He started Civil to energize journalism for the 21st century by rewiring how it works using emerging social technologies. For more, read his posts “What if the news were run by the people?” and “Why Civil?”
Stephanie Soussloff leads research and development at Civil. After studying geography, economics and social entrepreneurship at Middlebury College, she dove headfirst into the New York startup scene as a customer-centric analyst. She is excited about Civil’s potential to strengthen and empower communities globally.
Lillian Ruiz leads brand and community at Civil. She studied history at Wesleyan University before beginning her career in the digital marketing space, where she has served startup media companies and non-profits alike. Lillian comes to Civil energized by its paradigm shifting vision of a fully autonomous media landscape, and is eager to share its story with new audiences.
Civil currently has job openings across engineering and design with plans to grow to 10 people by the end of the year. Learn more here.
- CoinFund: Aleksandr Bulkin and Jake Brukhman are co-founders of CoinFund LLC, a blockchain technology research and consulting company that expertly designs cryptoeconomic systems with their clients. They are responsible for vetting our game-theory mechanics and technical feasibility.
- Tom McGeveran, Josh Benson and Katherine Lehr are longtime journalists who teamed up to establish and oversee POLITICO’s state operations. They’re currently working together on a new media endeavor. They are responsible for helping to define Civil’s “by journalists, for journalists” brand voice and recruiting reputable reporters to join our ranks.
- Chris Padovano is a New York-based attorney and the founder of Decentralized Legal. His practice specializes in the legal and regulatory implications of blockchain tokens and distributed software. He is responsible for guiding the ethical and legal path forward for building our decentralized community.
We didn’t reference any of their work specifically here, but these people have been highly influential to our thinking: Eric Ries, steve blank, Brian Robertson, Jay Rosen, Charlie O’Donnell, Fred Wilson, Joel Monegro, Nick Grossman, Brad Burnham, Ben Thompson, Fred Ehrsam, Satoshi Nakamoto, Ted Nelson, The Coral Project, Hearken, Marc Andreessen, bhorowitz, Chris Dixon, Peter Thiel, Vitalik Buterin, Frederic Filloux, Alex Moazed, Nicholas L. Johnson, Sangeet Paul Choudary, Jason Fried, DHH, John Wooden.
Thanks to Katie Neufeld Iles, Lauren Ramsby, John Ness, Blake Eskin, Alex Felix, Brandon Nygard, Jerry Weinstein, Chris Crowley, Matt Coolidge, Ryan Zampardo, Alex Hardy, Jono Schafler, Ed Staples, Sawyer Carter Jacobs, Eric Richmond, Stefan Pepe, Lindsay Ullman, and David Aaron Levine for their valuable input.
Identity design by Kim Lincon.