Washington, D.C., 2014—By 2009, we were at an impasse. The news business—newspapers in particular—was collapsing, and there was no obvious way to reconstitute it as a business that was capable of providing serious public-interest journalism. Paradoxically, though, the collapse of newspapers as a viable business didn’t reflect a collapse in the public desire for quality news.

We can rightly blame the convergence of portable computers and the Internet for this collapse. Real-time statistics on who is reading what, and when, revealed to advertisers, for the first time, the true scope and engagement of the news audience. The printed page had provided no such information, and that had allowed publishers to overcharge for their inventory—the display of the ad, not the actual reading of the ad, drove revenue. With no leverage to negotiate a better deal, advertisers had accepted this state of affairs. But by 2009, this was the reality from an advertiser’s perspective: real-time statistics on their consumption of ads that often showed a stunningly low return on investment and an oversupply of Web pages providing advertising inventory. The balance of power shifted to advertisers. As a result, online advertising generated a fraction of the revenue, per reader, that print advertising once had generated.

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