It’s hardly surprising that Web journalists should be fast, competitive, ruthless, sensationalist — and willing to do most anything for the story. It will be messy — and fun!

— Nick Denton, founder of Gawker Media discussing his decision to pay $5,000 for a next-generation iPhone found in a California bar, which his blog turned into a national news story.

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Steve will also be presenting a session on innovation on November 18. That live blog is also available online.

Gawker.com gladly engages in "checkbook journalism", paying sources for tips.

With all the attention garnered by the “balloon boy” story, any information available about the boy and his family became fodder for news outlets. Amid all the coverage, one online news site was able to score a rather valuable interview — one with a Denver college student who supposedly had knowledge of a plan by the family to mislead authorities and manufacture the ensuing media frenzy.

The interview to date has drawn about 500,000 hits to the site, Gawker.com. Gawker is the flagship blog in the Gawker blog network, which in October drew 394 million pageviews. The site thrives on aggregating and commenting on the day’s most controversial stories, often posting scandalous photos and employing racy language. It’s often called a gossip blog, and the company’s CEO has embraced the chaos created by the site’s commenters and regular contributors. But that wasn’t what got Gawker the exclusive story.

Gawker landed the balloon boy interview by cutting the interviewee a check. It’s not the first time Gawker has paid a source for a story. Last year, the company offered $10,000 to anyone who could provide an unretouched magazine cover photo of Faith Hill, which it eventually published. Nobody has revealed publicly how much the student made from the deal; he asked for $5,000 to $8,000 in a story on Business Insider’s website, but Gawker’s editor says they didn’t pay “near that much”.

Gawker’s practices are commonplace in entertainment journalism, TV news shows sometimes pay interview subjects licensing fees and outside the U.S. mainstream organizations engage in checkbook journalism. Gawker wants to use the model to break stories outside of those realms, though. Last year they offered tipsters $7.50 for every 1,000 pageviews.

Gawker CEO Nick Denton, courtesy of Flickr user Mathowie

For Gawker’s CEO, Nick Denton, there’s little regard for more traditional journalism ethics that would frown on the practice. In fact, Gawker’s the practices have been applied to the site’s writers, too.

Earlier this year, each writer was given a target number of pageviews he or she was expected to bring in. The target was based on each writer’s base salary, and if a writer exceeded that target he or she was rewarded proportionally. If, for example, a writer went 5 percent over the target, there was a 5 percent bonus in store. The company previously tried this with site-wide figures, and rewarded a site’s entire newsroom with bonuses for bumps in pageviews.

Gawker’s CEO, Nick Denton, explained the reasoning behind the practice in a memo to staffers: “It’s only on the internet that a writer’s contributions can be measured.” And to Denton, in an online news environment where ad revenue is based on pageviews, rewarding those who draw them in makes sense.

“Advertising people say that the internet is special, because the audience’s engagement is so much more measurable than that of newspaper readers, or television viewers,” he wrote in the memo. “Which makes it so bizarre that most writers, on the internet as in print, are paid for the sheer brute quantity of their output.”

Denton’s referencing the site’s previous payment method, which paid writers per post. That doesn’t recognize the way online news sites make money, though, Denton says. Gawker learned that quantity was important early on, as blogs that produced on a more regular basis drew in more readers than the less frequent posters. But after a certain point, an increase in postings led to only marginal increases in pageviews.

That’s what has the company turning to tipsters and hunting down exclusive stories, which can drawn 10 to 20 times the traffic as other posts. That’s also what has Denton playing with new ways to pay freelance writers; pageview bonuses are his way of paying for quantity not quality.

But some, such as Publishing 2.0 blogger Scott Karp, argue that the practice will reward stories that appeal to prurient interests rather than what’s considered good journalism in the traditional sense.

“The downsides of this approach are obvious — the incentive rewards content that is salacious, titillating, slanderous, nasty, etc. — anything that appeals to the base interests of a mass audience,” Karp wrote.

But Karp also thinks Gawker’s practices can be used to reward good original content; the system just unfortunately appeals to both the original and engaging, and the salacious. Mark Glaser, of PBS’s MediaShift, thinks the practice can also distract journalists from the journalism.

“Paying a blogger or journalist based on page views puts the onus on the writer to get traffic and takes away from their main job of research and writing,” Glaser wrote.

Glaser also asserts that the practice, while employed online, actually screams of “old media” by emphasizing mass audiences rather than small, engaged niche audiences that are more prevalent in the new more fragmented media landscape.

Practices like those employed at Gawker have wide implications for other areas of media, especially for those that work mostly on a freelance basis.

Do performance bonuses encourage yellow journalism by encouraging writers to play to what’s popular rather than what’s newsworthy in the traditional sense? Will the pay-for-views model reach into other freelance industries, such as magazine publishing? Can paying for news tips become an effective tool outside of entertainment journalism now that publishers can quantify their ROI on such an investment? Can the value of a news story be measured by the views (and therefore revenue) that it draws in? What about the maintaining of the reader-publisher relationship?

or €110,000 from the UK’s Daily Telegraph to buy information that broke one of the country’s biggest government scandals in recent history

A story is a story. We’re not squeamish about the means. And the paroxysms of the j-school ethicists add to the satisfaction.

— Gawker CEO Nick Denton, in an interview with the Wall Street Journal’s All Things Digital

TechCrunch.com has been criticized for its use of "process journalism" in reporting news about the tech industry.

As the Web has provided whole new avenues to tell stories, it has also created new methods of information gathering, some of which challenge some of the most basic principles of traditional journalism. Among the most controversial new ways of developing stories is what is being called “process journalism.”

And that’s not process journalism in the public affairs context –incremental reporting on governmental processes or deliberations. This is turning reporting into an open process in which the public is clued in from the time a news organization receives the news tip, at times an unverified one.

One of the news organizations held up as the king of process journalism is TechCrunch. TechCrunch, one of the most popular tech blogs out there, had approached 2 million visitors last month (for perspective, the New York Times had 16.7 million and CNN had 29 million).

TechCrunch is known for breaking stories out of Silicon Valley long before they reach traditional media, but they often do so by blasting rumors or unconfirmed tips across the Internet, at times sending stock prices tumbling (or soaring). They do so with full transparency – disclosing that what they’re printing is thinly sourced or just a rumor. It’s a practice that defies traditional journalistic values, but has been defended as a product of the Internet age.

And it has worked for TechCrunch. They posted rumors of Google’s acquisition of YouTube days before it was public and created a $6 billion swing in Yahoo’s share price on reports that the company was about to enter into a search partnership with Google.

So what is it about the Internet that makes this rapid-fire reporting work for sites like TechCrunch? It’s mainly the fact that they can update their posts as many times as necessary, never having to settle on a final product. That’s a sharp contrast to a TV station or newspaper.

In online news, there’s no deadline or no fixed newscast time. Instead, the story can evolve as long as the story stays alive. Mass-produced media don’t have that luxury. The story is more episodic by nature, and there are a fixed number of times the story can be printed or aired.

If the New York Times prints a rumor – a rumor in the truest sense of the word – it’s going to sit on the newsstand all day even if they found it to be untrue five minutes after their deadline. If TechCrunch posts a rumor and has it squashed five minutes later, the post can be immediately amended.

Explains Jeff Jarvis, a journalism professor at The City University of New York: “It’s a matter of timing, of the order of things, of the process of journalism. Newspaper people see their articles as finished products of their work. Bloggers see their posts as part of the process of learning.”

TechCrunch founder Michael Arrington; photo by Flickr user Joi

And that’s exactly how bloggers like TechCrunch founder Michael Arrington use their posts – as tools to learn more. “The fact is that we sometimes can’t get to the end story without going through this process,” Arrington writes. “CEOs don’t always take our calls when we’re asking about speculative rumors. But when a story is up and posted, it’s amazing how many people come out of the woodwork to give us additional information.”

Cluing readers in at the earliest stage crates a more loyal readership that feels closer to the process, Arrington says, and represents the highest form of transparency. He argues that his organization’s methods put them in a position to hold officials’ feet to the fire and drive the reporting process. And often, the site’s readers get involved as well when well-connected readers turn into valuable tipsters.

He also argues that this process often kicks off the reporting process for larger, traditional news organizations. “The only people who don’t like it are competitors who like to point out that a story was partially wrong, and that they got it right later. But the fact is that they didn’t even know there was a story to begin with. Our original post kicked off the process, and they, like us, started digging for the absolute truth.”

Like many of the stories in the blogosphere, the reporting techniques online are still evolving, with major implications for online news.

Will different standards emerge online than what exist in print? What does this mean for public relations professionals who are faced with a rumor being blasted across the Internet? Does process journalism performed by bloggers leave room for long-form, analytical journalism by mainstream organizations who no longer have to worry about simply being first? How does process journalism vary from cable news, political trial balloons or rumors about coaching changes that regularly appear in the sports pages?