“The idea that the proper role of a news agency is to be aware of incredibly important information … and just sort of sit on it while you dot your i’s and cross your t’s is what creates that sort of culture you have in Toronto where you have a mayor with a substance abuse problem that everyone knew about it and no one says it.”

Cook was speaking to CBC Radio after the latest twists in a bizarre political scandal over a video — witnessed by Cook and two Toronto Star reporters — that allegedly shows Toronto Mayor Rob Ford sucking on a crack pipe and calling the leader of Canada’s Liberal Party a “faggot.” Gawker fanned the flames of the scandal by asking the public to donate to a “crack-starter” fund to purchase the video from drug dealers.

The crowdfunding campaign reached its goal of $200,000 this weekend even after Cook had posted an update warning that Gawker had lost touch with the tipster who had connected the reporters to the video owners. (Update: Cook says he will give them a month to collect the money.)

The situation is proving an international embarrassment to Toronto, which is struggling how to reconcile its self-perception as a diverse and cosmopolitan city with its buffoonish, crack-smoking mayor. The Star continues to report new details about associates pictured with Ford (at right) killed and wounded in a homicide.

The media attention to the story has not only spread news of the scandal, but touched off debates about journalistic probity and the contrasting reporting styles of Canada and the United States.

Jeffrey Dvorkin, a former NPR ombudsman who debated Cook on the CBC interview, asked if it’s right to give the crowd-funded money to people who might use it to buy guns (the money has yet to be distributed and will be given to a Canadian charity if it is not paid to the video owners.)

Cook countered that paying sources is a routine part of journalism, citing a major political expense scandal in the UK that only came to light after the Telegraph paid a whistle-blower.

Cook also called Canadian media “timid” and questioned why the national newspaper, The Globe and Mail, sat on information for 18 months that purportedly revealed Ford family ties to drug dealing white supremacism.

In response to Dvorkin’s accusations that Gawker was getting “click-throughs,” Cook noted that a “Canadian reader of Gawker is worthless to us” [for advertising reasons] and repeated that a story about the mayor of North America’s fourth-biggest city smoking crack is important in its own right.

In case you missed it, the controversy turns on Toronto’s buffoonish mayor, Rob Ford, who has embarrassed the city numerous times in the past but has now outdone himself: Reporters from Gawker and the Toronto Star claim to have witnessed a clear video tape that shows Hizzoner sucking on a glass crack pipe and calling the leader of Canada’s Liberal party, Justin Trudeau, “a faggot.”

The video in question is now in possession of shadowy figures who want cash for it. The Star, a respected newspaper, turned down an offer to sell it for $40,000 and Gawker, which says the price is now $200,000, has taken to Indiegogo – a site normally used to raise money for artsy people — to ask the public to buy the video. The “Rob Ford Crackstarter” (see pic at right) has 10 days to reach its goal and has already pulled in $26,000 as of Friday afternoon.

Gawker’s gambit raises some very juicy ethical questions. First, while bringing down crack-smoking mayors is clearly in the public interest (see Barry, Marion), it’s less clear whether it’s acceptable to pay people who are likely serious criminals in order to advance the story.

And while check-book journalism has been around for centuries, turning it over to the public could have unforeseen consequences. Until now, publicly funded journalism has been largely been contained to organizations like Pro Publica that launch investigations into things like patient safety and vote buying. Is the world ready for a publicly funded version of TMZ where everyone can pool money to see celebrity’s private lives?

For now, the political dimensions of the scandal are moving too fast to assess the media fallout. We’ll report back next week on what happens to the tape — and the money collected by Gawker.

(Image by Chris Howey via Shutterstock)

If launching the project via Kickstarter was a gamble — and one that apparently took a certain amount of convincing before Planet Money’s corporate masters would sign off on it, according to Blumberg — it certainly seems to have paid off: the campaign hit its goal in a single day, and has since raised about $300,000 or six times as much as it was originally looking for (the audio of my interview with Blumberg is on SoundCloud and also embedded below).

Crowdfunding and public radio both go direct

Blumberg, who works for This American Life and created the Planet Money show in 2008 along with NPR economics reporter Adam Davidson, said that when the show decided to set up the T-shirt project — an idea that stemmed from a book by Pietra Rivoli called “The Travels of a T-Shirt in the Global Economy” — he thought Kickstarter was the most obvious way of allowing listeners to not only follow the experiment, but to become participants in it as well.

“We wanted to try and figure out a way to do the project, to do the journalism, but also to sell the T-shirts to people who wanted them, as a way of involving them in the project — so you can either guess about how many you need and borrow the money or sort of get it pre-funded, or you could just go on Kickstarter and find out exactly.”

One of the reasons why it seemed like such a good fit, Blumberg said, is that public radio and the NPR model already involve reaching out to listeners and supporters directly, so it seemed natural to blend the two (a public radio podcast called 99% Invisible took a similar route last year and raised more than $180,000).

“The other part about Kickstarter is that it’s just a great way of sort of involving folks in the project as you go along, and… it felt like with our audience there’d be some interesting overlap there between Kickstarter and public radio — it felt like they would sort of feed on each other. The public radio audience and the Kickstarter model are so close anyway, so why not combine them — it’s sort of surprising that it hasn’t happened before.”

The internet turns everything into public radio

In fact, Blumberg said, it feels like “the internet is driving the entire world towards a public-radio model” in a way, as more media companies — and even individuals such as Daily Dish blogger Andrew Sullivan, who is relying on direct reader funding for support — try to find a way of surviving when advertising revenue is declining and other business models are not obvious.

“You can get lots of stuff for free now, and so the trick is to get people to pay for stuff they can get for free. It’s a trick that public radio has gotten pretty good at, but now other people are sort of eclipsing us — Kickstarter is very ingenious in the way you can involve people in the story, you can build all sorts of different levels, and it’s very very easy. So part of it is about learning what we can from our Kickstarter experience and then feeding that back into the public-radio world.”

Blumberg said that he was pleasantly surprised at the amount of money the project has been able to raise, and that he originally expected it would take most of the campaign’s time limit to even get to the $50,000 goal. The majority of the money raised will go towards travel and production costs, as well as the cost of buying and making the shirts, he said — and anything left over will be used to create a development fund for NPR member stations and put on a series of workshops about the kind of reporting Planet Money does.

A chance for a public-funding revolution

And will evangelizing Kickstarter be part of that program? Blumberg said that the project seems to be doing its own evangelizing, just because of the overwhelming response, which he says executives at NPR and throughout the public-media world are watching closely and are “very excited about.” The American Life producer said he also hopes the project will spark more discussion about the ways in which public radio can use crowdfunding platforms.

“Public radio has been a little insulated from some of the ways the internet has changed other media organizations, but the internet is upending radio as well, in a way that I think can be very advantageous, it just depends on how you do it. I think there’s always been a realization within the public radio system that there’s revolutionary potential, and I think this will add to that conversation and hopefully move it forward.”

Blumberg said that he believes public radio can learn a lot from seeing how crowdfunding works in practice with a focused project like the T-shirt campaign, and that the connection between fans and creators that Kickstarter and other platforms help to create is very much like what public media has been doing for some time without the internet. “I feel like we’ve been out ahead of this whole thing for a long time,” he says, “and we didn’t even know it.”

Post and thumbnail photos courtesy of Flickr user Christian Scholz and Shutterstock / Wilson Rosa and Shutterstock / higyu

Apple and the horrible, no good, very bad Maps app

The Amazing iOS 6 Maps Tumblr

The September launch of the iPhone 5 was marred by the disastrous reception Apple’s new Maps app received. Parody social media accounts popped up within hours, as disappointed users complained of poor or missing location data. CEO Tim Cook felt compelled to make a public apology, and it’s thought that the episode was the last straw that caused Cook to send SVP Scott Forstall packing. To rub extra salt in the wound, Google’s own Maps app for iPhone was greeted with the Twitter equivalent of a Hallelujah chorus when it arrived last week – and was downloaded 10 million times in 48 hours. – Erica Ogg

Google’s media player that never got a chance to play

Google surprised many in June when it announced the Nexus Q, a wireless digital content player dubbed as “the first social streaming media player.” But not all surprises are good ones. The small orb-shaped device launched at an introductory price of $299, triple that of the more capable Apple TV. And aside from the high price point, the Q offered no media services save Google’s own Play store for movies, television shows and music. The unique DJ function — allowing anyone’s Android device on the same network to mix the music — was hardly enough to justify the Q, which Google suspended indefinitely in July. — Kevin C. Tofel

Facebook’s troubled IPO

The initial public offering of the world’s largest social network was supposed to be the tide that lifted all technology boats, but the IPO instead turned into a stock-market train wreck and crushed the hopes of many other tech-stock hopefuls in the process. Thanks to a combination of mismanagement by the NASDAQ stock exchange (which used a new trading system for the issue) and a misreading of the initial demand by Facebook and its brokers — which resulted in an over-supply of stock — the company’s share price tumbled by more than 50 percent in the days and weeks following the offering. The company still wound up raising more than $16 billion, but the episode gave the tech darling a black eye as far as some investors were concerned, and likely set the market for tech-stock issues back by months, if not longer. — Mathew Ingram 

Two words: HP and Autonomy

The $11.1 billion purchase of Autonomy by Hewlett-Packard may have been announced in 2011, but the enormity of the screw-up didn’t fully surface till 2012. In May, HP management booted former Autonomy CEO Mike Lynch, and in November the company asked authorities in the U.S. and U.K. to look into Autonomy’s accounting practices prior to the buyout. That process is ostensibly now underway. Nevertheless, after airing all this dirty laundry in the November earnings call, HP CEO Meg Whitman asserted that HP remains “100 percent committed to Autonomy.” For the record, HP took a loss of $6.85 billion for the full fiscal year ended October 31, 2012 — most of that from an $8 billion writedown related to the Autonomy business. — Barb Darrow 

Nate Silver’s an idiot and Romney wins in a landslide

Except…Nate Silver isn’t and Mitt Romney didn’t. Silver, the founder of the New York Times‘ popular FiveThirtyEight politics blog, and several other notable statisticians mathematically predicted Barack Obama’s reelection with perfect or near-perfect accuracy. Meanwhile, Karl Rove sputtered through election night on Fox News, futilely defending his prediction like a child trying to convince a teacher a dog ate his homework. Maybe there’s something to this data analysis after all. Go figure. – Derrick Harris 

Amanda Palmer crowdfunding fubar

Alt-rock fave Amanda Palmer experienced the downside of social network savviness in September after she raised $1.2 million on Kickstarter to fund her new CD — then solicited musicians to play for free on her subsequent concert tour. Reaction was heated and Palmer quickly regrouped, saying she would pay more than beer, hugs and “merch” for the help. The alternate theory is that this was all a massive publicity stunt — in which case, it was hugely successful. (Palmer has since cancelled her 2013 tour to help a friend deal with cancer.) — Barb Darrow 

Twitter gags NBC Olympics critic

What do you when someone says mean things about your friends? You shut them up; at least, that’s what Twitter did during the London Olympics when it suspended the account of journalist Guy Adams, who tweeted snarky things about the TV coverage of Twitter’s corporate partner NBC. Twitter blamed an internal communications snafu and restored the journalist’s account two days later. Still, the incident became Twitter’s first full-blown PR crisis and a reminder of its growing shadow over our media lives. — Jeff Roberts 

The Western Mail’s caption fail

Tweeters celebrate epic #fails on an almost minute-by-minute basis. And for digital media aficionados, ye olde newspaper sub-editing and caption errors rank high on that dreary list. But there was none more epic in 2012 than Welsh newspaper the Western Mail, which committed what was labeled “the worst caption fail of all time” when it identified a photo of an airport manager, who died when the plane he was travelling in hit a mountain, with “LOL.” Although British prime minister David Cameron may think the acronym stands for “lots of love”, everyone else knows not to “laugh out loud.” The internet was not amused. Nor was Western Mail publisher Trinity Mirror, which responded, “We apologize for any offense this error may have caused.” – Robert Andrews

AT&T’s face-off over FaceTime

Trying to convince your customers, the public and your regulators that you’re just a big, cuddly carrier without an anticompetitive bone in your body? Maybe blocking a wildly popular app that happens to compete directly with your core service isn’t the best way to score points. Oh, but wait, AT&T didn’t block FaceTime over its cellular networks. You could use Apple’s video chat app to your heart’s content if you signed up for one AT&T’s (more expensive) family share plans. It’s not every day that a carrier stifles competition and jilts its customers for more money in a single brush stroke, but Ma Bell is a very efficient painter. Eventually consumer protests and the threat of the FCC involvement caused AT&T to backtrack. It offered FaceTime over cellular to more subscribers, and sheepishly claimed it was just protecting its customers from the inevitable network overload FaceTime would bring. Okay, but if AT&T’s new fangled 4G networks can’t handle video, what was the point in building them? Email and Twitter updates? — Kevin Fitchard

Bravo’s Silicon Valley startup trainwreck

Silicon Valley has been abuzz with Randi Zuckerberg’s Bravo reality show “Start-Ups: Silicon Valley,” which attempted to portray the craaaazy lives of startup founders and their companies in the Wild West. However, the show has been widely panned by techies and journalists in the Valley, who are obviously underwhelmed by shots of people in the pool with iPads and dialogue like ”Silicon Valley is just…balls to the wall.” Of course there’s an element of hilarity to the shenanigans associated with tech startups in the Valley, but it doesn’t appear that Zuckerberg’s show will be the one to effectively dramatize it. And now that the final episodes are being downgraded to a 4 PM PST time slot, looks like the show’s on its way out. – Eliza Kern

J.K. Rowling’s unreadable book

Getty Images

J. K. Rowling fans who’d preordered the ebook edition of her hotly anticipated new novel, The Casual Vacancy, were in for a surprise on September 27: Thanks to improper formatting by publisher Hachette, the ebook was literally unreadable, with a choice of two type sizes — microscopic or massive. Hachette pushed out a new file later in the day, but this was one of the biggest books of the year, and in 2012 there’s no excuse for failing to test an ebook before you release it. – Laura Owen 

VeriFone copies Square’s user agreement

VeriFone launched its mobile payment acceptance system Sail to compete with Square. But it went a little too far in emulating Square when it copied big chunks of wording from Square’s user agreement. When called on it by GigaOM, VeriFone cut about a third of its user agreement out to eliminate the copied text. – Ryan Kim

So who didn’t suffer a data breach?

Shutterstock/deepspacedave

So much for consumer confidence. In 2012, several of the biggest names in tech were forced to ask for users’ forgiveness after hackers gained access to customer records. In January, Zappos CEO Tony Hsieh apologized after hackers accessed names, email, billing and shipping address and scrambled passwords for potentially 24 million customers. And, in June, Yahoo, LinkedIn , Last.fm and eHarmony followed up with confessions of their own after a spate of hack attacks that compromised user passwords. In April, electronic transaction processing provider Global Payments also confirmed a data breach of 1.5 million credit cards. – Ki Mae Heussner

It is great for culture to have these innovative new artefacts join the fray. But crowdfunding is not just for newcomers — blasts from the past can also get a second life by leveraging the same kinds of direct-funding mechanisms. That’s something I realised while observing two new crowdfunding projects this week:

• X Factor UK reject Janet Devlin is using PledgeMusic to finance the release of her upcoming debut album. In a music industry that has become risk-averse, The X Factor TV show, like crowdfunding networks, is itself a prolonged exercise in testing the viability of a potential act before signing. Devlin was voted out during the 2011 season’s eighth episode. That should have put paid to her pop music aspirations. But those ambitions are now allowed to live on by a crowdfunding initiative that refuses to let go of the fans the young singer nevertheless amassed during the show.
• Revered computer game developer David Braben is using Kickstarter to try funding development of a re-make for his lauded 1980s space exploration classic Elite. The title wowed the first generation of video gamers with its wide-open space-scape and wireframe crafts in 1984, when it occupied just 22k of memory. Now Braben says: “Elite: Dangerous is the game I have wanted Frontier to make for a very long time. We have had a couple of false starts on this over the years. We have been preparing; laying the technology and design foundations for when the time is right. And that time is now.”

In each case, crowdfunding sites are allowing creators to reboot failed ambitions. As they do so, are they trying to subvert a kind of cultural natural selection that has already given them ample opportunity to make it big? To desperately relive a future that they were not destined to see?

Not necessarily. In this world, you take what opportunities are available. Devlin may have been offered a record contract within minutes of her exit from the TV show, and her PledgeMusic effort may seem curiously professional already, with a tour already seemingly planned — but she appears to be approaching her recording genuinely independently.

Elite: Dangerous would not be the first “blast from the past” to be remade for games lovers. Such titles as Duke Nukem have recently been re-released for spangly 3D console engines, while Super Mario’s ever-advancing franchise is routinely remade by a new take on its classical save-the-princess narrative.

Indeed, we appear to live in a time of pronounced cultural revivalism. Hi-def remakes appear on our cinema screen at a rate of knots, boy-bands reform after acrimonious splits — all designed to extract money, a second time, from audiences who, back in the day, could spend only pocket money but who, now in their 30s or 40s, are the prime targets for buying high-priced arena gig tickets and 3D multiplex seats.

Until now, these revivalist cultural experiences have been the preserve of the same kinds of big-media culture producers and puppeteers who financed their blockbusters a generation ago.

But now, just like the brand-new innovative outputs that can be funding by the likes of Kickstarter, out-of-favour practitioners who never quite made it or whose glory days are long gone can also start anew. Not only does the new rub shoulders with the old, in our long-tail age – it is also mingling with the renewed, in what is simultaneously a virgin start and a curious afterlife for content.

Crowdfunding site Kickstarter also processes payments through Amazon, but has not been affected by the change.

Amazon told Unglue.it CEO Eric Hellman that it is not approving new crowdfunding accounts due to “regulatory burdens” and “contractual obligations.” Unglue.it has been “required to void all pending authorizations,” though the one book that has already been unlocked – Oral Literature in Africa, a title aimed primarily at academics and librarians that raised $7,578 from 259 supporters — is not affected.

While some commenters on Twitter suspect Amazon of trying to take down a smaller ebook company, another small company received a similar notice and Hellman told me “it sounded like they want to be able to reverse course once they figure out how to meet their obligations efficiently.” Amazon’s policy is likely to affect any company that wants to process crowdfunding payments through the site. Paypal has a recommended process for crowdfunding payments and crowdfunding sites like Indiegogo and Togather process their payments through Paypal. A Paypal company rep did not respond to my request for comment, but a Paypal developer on Quora notes that any site processing crowdfunding payments, as well as any business oriented around them, has to worry about anti-money laundering policies. Hellman told Library Journal blog The Digital Shift that Paypal is still processing Unglue.it’s application.

Update: An Amazon spokesman told me, “We support a wide variety of businesses, but we have regulatory obligations as a licensed money services business for how we operate. Unfortunately, Unglue.it’s model is not the same as some other crowdfunding services and at this time does not allow us to meet those obligations.”

Under increasing financial pressure from the web and the decline of print advertising, newspapers and other traditional media outlets have been laying off staff and trying to fill the gap with services such as Journatic — the hyperlocal aggregator that uses offshore workers — or simply doing without things like copy editors. But are there other solutions to that reporting gap? Crowdsourcing journalism through sites like Reddit could be one, but crowdfunding could be another: One journalist in Michigan has raised funding through a Kickstarter campaign so he can travel around the U.S. interviewing people about the upcoming election. Could crowdfunding allow other journalists to do investigative or in-depth projects as well?

Media blogger Jim Romenesko first called attention to the campaign by Chris Killian, a journalist from Kalamazoo who came up with the idea of driving through swing states like Iowa, Pennsylvania and New Hampshire in order to take what he calls the “pulse of the people.” On Sunday, just a few days after Romenesko’s report, Killian said he had reached his campaign goal, although it should be noted that it was not overly ambitious: He was only looking for $2,500 that he could use for living expenses, since he is planning to live and work out of his 1984 Volkswagen camper van ($2,000 of the total figure is for gas).

Could journalists crowdfund major projects?

Killian says he wants to get what he calls “grass-roots, organic and sincere stories” from everyday people about their lives and the economic prospects in their part of the U.S. He said he plans to talk to people of all political stripes and ask them “what we need to do differently to tackle the big challenges that we need to face to grow and prosper. Is the American Dream still alive?” The Michigan-based journalist, who is a staff writer for the newspaper in Kalamazoo but is also a freelance writer, says video and audio interviews will be available on a website for the project, called “Swing State Stories.”

Without meaning any offense to Killian, his project is definitely somewhat eccentric, and the amount he is asking for seems almost absurdly low. That’s especially when we are used to reading about a school-bus monitor who got more than $500,000 after being bullied by her charges or a young boy whose cardboard arcade at his father’s auto-parts store led to more than $200,000 being donated to his college fund. But could the core idea — raising money from potential readers for a specific project — work in principle for other journalistic pursuits? And would it work for mainstream media outlets, or just individuals?

The idea of crowdfunding journalism isn’t a new one: Journalist and entrepreneur David Cohn started a company called Spot.us in 2008 to do exactly that and had some notable successes, such as a feature on the “garbage patch” in the Pacific Ocean, a joint project with the New York Times. Earlier this year the company was acquired by American Public Media and merged with the Public Insight Network, and the website says it has more than 15,000 contributors and 110 publishing partners (Cohn has since moved on to a new project, a media startup called Circa).

Crowdfunding might work better for individuals

It’s probably fair to say Spot.us isn’t really a household name, however — at least, not in the same way that Kickstarter has become the poster child for crowdfunding of both products and causes (although the bus-monitor fundraising came through competitor Indiegogo). In that sense, using Kickstarter might be more likely to win journalists some awareness and credibility if they started a campaign for a specific research project, the way Killian has. I have seen estimates from newspaper editors that the typical investigative project requires about $200,000 in funding for a paper to pursue. Could that amount be crowdfunded? Perhaps.

That said, however, I’m not sure whether a platform like Kickstarter or Indiegogo or even Spot.us would work that well if a campaign were to be started by a major newspaper or the owner of a chain like Advance Publications, which has been laying off staff and shutting down printing at some of its newspapers. That kind of behavior isn’t likely to endear readers to the media outlet or make them want to donate money to it, whereas a unique or even eccentric project from an individual journalist like Killian seems to be more in the spirit of a Kickstarter campaign. Indie musician Amanda Palmer raised $1 million for a record and tour, but a record label would be unlikely to see the same kind of success.

It would be interesting to see other journalists experiment with the kind of thing Killian is doing, however. There have been some projects that fit a similar mold, including one in which an independent cartoonist and war correspondent raised money for a reporting trip to Afghanistan in 2010. Maybe Morgan Jones, the 18-year-old who turned a Reddit thread into a journalistic outlet during the recent shootings in Colorado, could raise money to turn his account on the site into a permanent reporting gig.

Update: I would be remiss if I didn’t mention one of the most prominent journalism-oriented Kickstarter campaigns — namely, a project called Matter, which is focused on publishing in-depth science journalism. According to co-founder Bobbie Johnson (Full disclosure: Bobbie is a GigaOM colleague who is based in England) the campaign is the best-financed journalism project ever on Kickstarter.

Post and thumbnail images courtesy of Flickr user Tracy O.

We have already seen Kickstarter, the popular crowdfunding platform, used to finance some fairly interesting media experiments, including books from authors like Seth Godin, record albums by artists like Amanda Palmer and even an entire magazine in the case of Matter. But could a publisher use the service to crowdfund its way out of the advertising-revenue trap in which many media companies find themselves? Penny Arcade, which publishes online comics and puts on related events, is trying to do exactly that with an ambitious Kickstarter campaign aimed at replacing the revenue it currently gets from advertising with funding from fans. But will it work? And could it provide a model for other media companies?

Penny Arcade is anything but a traditional publisher: It began as a simple video-game-oriented webcomic that writer Jerry Holkins and artist Mike Krahulik posted semi-regularly online in the late 1990s, and it has become a regular series with a number of associated real-world products (including several video games) and its own gaming conference called PAX. It is one of the longest-running webcomics around, and Holkins and Krahulik have made their living by publishing it for the past several years — in part by running advertising on the site where the comics appear.

Returning to a reader-centric model

In the early days of the comic, Holkins says the two founders managed to run everything through direct donations and sales of related products, but as the site grew bigger they figured they had to sell out and offer advertising in order to survive. But in the description of the Kickstarter campaign and a related blog post, he said eventually he and Krahulik wondered whether the platform would allow them to raise enough money to go back to a fully reader-funded model:

I think we had assumed it wasn’t possible to do it that way anymore — to operate a site at this scale without advertising dollars — but it occurred to us that we’d never actually asked. People often want to know how they can support the site in a way that doesn’t involve t-shirts or looking at advertising, and I think we may have a way. What I’m saying is that we want to sell out, and we would love to sell out to you.

The initial goal for the campaign, which ends on Aug. 15, is to raise $250,000, which the two founders say will allow them to dispense with banner advertising. If more money is raised, Holkins says the two will “restore old services we used to offer, convert the entire site to a Creative Commons license, and ultimately remove every ad from the site for an entire year.” The Penny Arcade founder says the larger idea behind the campaign is to become a company “that succeeds by making things, specifically things for you.”

The two co-founders have also made it fun for participants in the Kickstarter fund-raising effort by including bizarre or unusual offers as part of the different tiers of funding. So the $1 pledge says one character “will shout out your name as he chases a duck” and for $25 or more, another “will name your pet.” Higher pledge amounts come with a chance to be one of 50 people on the set when Penny Arcade films a movie version of the comic, and for a $5,000 donation a fan gets to come to Penny Arcade headquarters and hang out for an evening of pizza and games with the creators and other staff.

Could other publishers follow this model?

One of the people watching the campaign is Rob “Commander Taco” Malda, who founded the online community Slashdot and is now working on digital projects for the Washington Post and mentioned it on Twitter and his Google+ page. Could a Kickstarter campaign have saved Slashdot from having to be sold multiple times to different companies as it tried to keep the servers behind the community running? It’s an interesting question. Crowdfunding seems to have become so well established that it could theoretically give website publishers a lot more financial freedom.

Penny Arcade is doing a Kickstarter to remove all ads from the site for a year. This sort of thing really excites me. kickstarter.com/projects/57510…

—
Rob Malda (@cmdrtaco) July 10, 2012

The Penny Arcade experiment has a humorous tone, but the intent behind it is a serious one. By turning to its readers, Penny Arcade wants to become a totally reader-centric business that answers only to its fans and supporters. In some ways it’s the ultimate extension of the model the New York Times and other traditional publishers have taken with paywalls and other subscription plans, except Penny Arcade has come at it from the opposite direction: Instead of hitting readers with a paywall when they try to read something, it is asking for funding up front before the content has even been created.

Targeted publications like the Financial Times and the Economist seem to already be on the road toward this kind of model, with subscriptions surging ahead of advertising to make up more than half of the revenues at the FT in a recent period. Is this a model other media entities could pursue? Perhaps. But they would need to have as devoted a fan base as Penny Arcade, which by late Tuesday had already come up with almost a third of the amount the site was looking for in less than 24 hours.

Post and thumbnail images courtesy of Flickr user Christian Scholz

Comedian Louis CK raised some eyebrows earlier this year when he sold downloads of a live show through his website and pulled in more than $1 million in about a week, despite the fact that fans could easily download the content for free. Now, he has done it again: instead of a traditional tour, he decided to sell tickets through his website, and sold $4.5-million worth in under 48 hours. Content creators of all kinds — authors, musicians and others — would do well to learn from his example, and that of others like Amanda Palmer, who recently financed a new album and tour through Kickstarter. The main lesson? Building a community is more important than ever.

Louis CK (whose real name is Louis Szekely) was far from being an unknown when he launched his download experiment in December: he had a show on Comedy Central the FX network that was fairly successful, and had appeared on late-night talk shows — but he was far from being a top-tier name. But one thing CK did have was a community of fans, and he tapped into that when he offered a self-financed show to them as both a live-stream and a download. And he deliberately didn’t encrypt the show with digital-rights management locks or barriers, because he said he wanted to make it as frictionless as possible for fans.

As I pointed out at the time, media companies of all kinds could learn a lot from that approach — including the lack of DRM controls and the power of the community that CK was able to draw on. Tens of thousands of fans paid $5 for that show even though they could have easily downloaded it for nothing. His latest move, in which he offered single-price tickets for a 39-city tour through his website, built on that community and created a sold-out $4.5-million tour in less than 48 hours. That’s an incredibly powerful example of going direct to your fans.

Can giving content away result in more money?

This kind of model isn’t necessarily restricted to individuals either, as Union Square Ventures partner Andrew Weissman points out in a blog post about the TED conference entitled “What If We Give It Away.” As he notes, the conference has spent the past couple of years giving its content away for nothing — via videos on its website and elsewhere, and also through the branding of free TED spinoffs called TEDx conferences in cities around the world. As Weissman notes:

[B]y giving away what one would generally think of as a company’s (a media entity) greatest assets – its content, brand and business processes – the business has grown enormously in just a few short years.

On the individual front, musician Amanda Palmer is another great example of this approach: she quit her record label in 2010 and decided recently to fund a new album and tour directly by allowing her fans to donate through Kickstarter. Her original goal was $100,000 — but she blew through that figure in a matter of hours after the launch, and by the end of the campaign had raised ten times that amount or almost $1.2 million. In return for the funds, fans get a variety of rewards, including a signed art book, an invitation to special dinners and parties for fans in a number of cities, and so on.

One thing that’s important to note about both of these examples is that CK and Palmer didn’t just pull in a huge amount of money and walk off to do whatever they wanted with it: both of them have spent a lot of time detailing what exactly will happen to the funds, with Palmer in particular posting an itemized breakdown of her expenses for the album and the tour so that her fan community realizes what is involved. Louis CK, meanwhile, gave a substantial portion of the money he made from his downloadable show to charity, and wrote about that.

Building on those “1,000 true fans”

Authors can also benefit from this kind of community, and there are any number of examples: self-published young-adult fiction writer Amanda Hocking made more than $2 million without an agent or a traditional publisher by distributing her e-books through Amazon’s Kindle platform, and author John Green managed to get his new e-book to the number one spot on the best-seller list before the book was even completed — because his community of fans was already connected to him on multiple levels, including Twitter, Facebook and YouTube.

This kind of community engagement has always been important: the band The Grateful Dead was legendary for allowing fans to tape its live shows and share that content, and other artists such as Jonathan Coulton have also made a living while still giving away much of their content for free (Coulton is also a thoughtful commenter on the issues around copyright infringement). Radiohead and Girl Talk have both used the “pay what you want” model for album downloads, which show — just as Louis CK has — that fans will pay even when they can get the content for nothing.

What has happened is that the web and social media — along with crowdfunding platforms such as Kickstarter and Indiegogo — have added more horsepower to the concept that Wired magazine founding editor Kevin Kelly described as “1,000 True Fans.” In that model, trying to become the next global superstar through traditional media is replaced by connecting with a loyal fan base and then engaging with them, whether it’s to fund a tour or an album or a book (marketer and author Seth Godin is funding his new book through Kickstarter).

Can anyone make use of this new model? Obviously it helps to have already established a brand, as Louis CK and Amanda Palmer have (or Seth Godin and TED). And there may be no easy parallel to the concert tour when it comes to some kinds of content — but the power of connecting directly to your fans, however small that group might be, can’t be underestimated. And whether its record labels or publishing houses or media companies, former intermediaries and gatekeepers of all kinds are going to have to try a lot harder to prove that they are adding some value to that process in order to survive.

Post and thumbnail images courtesy of Flickr users Christian Scholz and Giuseppe Bognanni

“We’re big fans of numbers here at Kickstarter, and we’ve shared many Kickstarter stats and trends on this blog,” the company said. “Those posts have typically been tied to milestones, but we’ve always wanted a way to share our numbers consistently.”

For each category, Kickstarter Stats displays the total number of projects that have launched, the number of live projects, total dollars raised, success rate and other metrics. It also breaks down the categories by successful and unsuccessful projects. The latter piece is particularly interesting in light of the recent attention around the difficulty of finding failed projects on the platform.

In a recent interview with Om, Kickstarter cofounder Perry Chen Om talked about how Kickstarter is less of a company and more of a movement. Seeing the aggregate activity on the site and the range of categories it impacts (from theater and film to publishing and design) certainly provides evidence for that.

Here are just a few interesting stats:

• Over $250 million has been pledged to Kickstarter projects
• Over $215 million has been pledged to successful projects
• Seven projects have raised more than $1 million
• Over 7,000 projects (13 percent) have never received a single pledge
• 60,786 projects have been launched on the site
• Over 4,000 projects are live right now