By Gina Cuclis

The news that wealthy San Francisco financier Warren Hellman has teamed up with KQED-FM and UC Berkeley's Graduate School of Journalism to create a nonprofit Bay Area local news website has local media observers wondering if this will hasten the demise of the area's troubled daily newspapers.

The trio last night announced the creation of the Bay Area News Project saying it plans "to provide high-quality, original coverage of Bay Area civic and community news." Hellman, co-founder of the private equity firm Hellman & Friedman, is providing $5 million in seed money. KQED-FM and UC Berkeley will provide journalism expertise and labor. Once formed, the Bay Area News Project will file for tax exempt 501(c) status and seek to be funded primarily by donations. Its website says over the next few months it "will begin hiring a staff of professional journalists." The site provides an e-mail address for submitting resumes.

The Nonprofit Model

Having newspapers become nonprofit entities has been one of the ideas suggested by academics, politicians and others concerned about the future of the newspaper business. I wrote in July about the Newspaper Revitalization Act, which is intended to assist newspapers that want to make the transition. However, creating an entirely new nonprofit organization to provide local news is another matter. San Francisco is not the first US metro area to have this type of news organization. Similar local news sites exist for San Diego, Seattle and a couple other major cities.

The Potential Threat

In addition to providing local news online, the Bay Area News Project intends to feed stories to media partners. One potential partner is the New York Times, which previously announced plans to launch a San Francisco edition. They've reportedly been in talks for months.

What the San Francisco Chronicle and other troubled Bay Area daily papers don't need is additional competition. In the last five years, Bay Area newspapers have collectively reduced their staffs by 50%. This has naturally led to a decline in coverage of local politics, issues and other community affairs. The decline in local coverage is Hellman's motivation for starting the new organization.

Hellman said in a press release: “The Bay Area has a voracious appetite for news and is one of the most engaged and community-minded regions in the nation."

When asked by the New York Times if he thought his news project would accelerate the decline of troubled newspapers, Hellman said: “'I think that’s a reasonable question. I think that demise might be inevitable, anyway. This might put journalism, broadly defined, on a much more stable foundation.”"

SF Chronicle Publisher Frank Vega's statements in the Chronicle's article about the Bay Area News Project sound like someone remaining positive in the face of bad news.

The North Bay Connection

I think initially the nonprofit news site will have little impact on the Santa Rosa Press Democrat. However, it will be interesting to see what happens if and when the NY Times joins the effort. The Times owns the Press Democrat. It's been rumored off and on that the Times has wanted to sell the PD. If the Bay Area News Project is successful and grows, could the PD end up being swallowed into the Times' San Francisco edition? What do you think?