I recently blogged about the many benefits that I hope will come to America with the passage of the JOBS Act. Now that the US Senate has passed the JOBS Act (with an amendment that I support), the bill has gone back to the House of Representatives for final approval before President Obama signs it into law. Despite my skepticism about the ability of Congress to pass any legislation in this toxic and partisan political climate, I am pleasantly surprised that it looks like the JOBS Act should go through with bipartisan support.
My general thesis is that if the “people” can now invest in new ventures, then they will be more apt to use products and services that cater to small groups/communities, and more likely to shun products, services, and information that comes from large corporations that are geared for the masses. (Of course, it may take a couple of years to see these effects, but I am hopeful that fragmentation can create diversity in spheres of life where Americans now have too few choices.)
While other commentators have focused on the overall benefits and drawbacks for investors, businesses, regulators, and consumers, I will list potential ways that the new crowdfunding legislation can influence and disrupt journalism. My theories on winners and losers from the JOBS Act:
1. Communities can rally around creating publications that they control, rather than leaving sub-par newspapers in the hands of publishers motivated by the bottom line rather than creating high quality community content. (Look out Patch and legacy publishers!) The potential to revive local journalism in places that are currently without local news sources is the most promising development that I see. But legacy media organizations should be on guard, because disruption born out of frustration may be just around the corner.
2. Niche publications will be able to get off the ground more easily. If a fragmented community of 1,000 people (I’m thinking an online community for this example), spread throughout America, wanted to hire one person to work to create content, they could hypothetically each donate $30 to a venture that could create a niche publication with a professional or semi-professional journalist/curator at the helm.
3. Television networks and cable channels should be scared because YouTube is already slicing up the market, but enthusiasts of various types of content that don’t achieve the critical masses needed for channels that cater to advertisers may now have their opportunity to band together to create more desirable programming…and make it profitable.
4. Television news should be a prime target for entrepreneurs at the local and national levels, as it has remained virtually unchanged for such a long time. I foresee new formats developing, and I believe the crowd will control how they develop.
5. Crowdfunded radio stations may destroy the traditional for-profit ones. Watch out ClearChannel. Look out for an indy radio explosion…(most likely based on the Internet).
6. Lone bloggers and journalists with strong personal brands (or with the ability to build strong personal brands) will now be able to have investors rally behind them. This could create a major revolution for sole proprietors, ending the struggles that freelancers face in terms of tax burdens. Another advantage is that talented people may now be more willing to go off on their own rather than remain with corporations that under-utilize talented journalists’ skills and abilities.