Politico has teamed up with Reuters to expand the coverage of its fledgling wire service. Reuters will add its own articles and content to Politico's network of over 60 newspapers and 100 website partners.
In addition to free content from Politico, partner newspapers will have access to up to 10 Reuters articles and photographs each day to use in print or on the Web. Politico will sell advertising on the content and share the revenue with its partners.
According to The New York Times:
The service is a much smaller version of the Associated Press' wire service, which delivers news to 1,400 newspaper clients. But the business model addresses a major problem that newspapers are currently dealing with. With budgets and staff sizes shrinking, newspapers are having trouble maintaining their standards of coverage. And they're increasingly having trouble paying for wire copy. A.P. is struggling to retain its clients, and CNN has also recently joined the wire service fray.
The Times questions Politico's ability to attract advertisers to its new service in the current economy, but that's not really the problem —
it really doesn't matter how much advertising revenue Politico brings in. At this point, newspapers are looking for ways to stop bleeding money. Ad revenue on top of that is icing.
The real question is whether Politico can transition from a niche political site to a useful national service. The partnership with
Reuters will help in those efforts, but Reuters does not really cover local news, a major service that the A.P. provides newspapers.
"At some point you have to share ad revenues," says Daniel Taylor, an analyst with Yankee Group. "Maybe the price we pay for the Internet is not actually having local news."
UPDATE: This post has been updated to with information on the partners in the Politico network.
