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Star Observer turns to crowdfunding as legal costs threaten its future

A series of legal settlements and threats have pushed Australia’s oldest gay newspaper to the brink.

Australia’s oldest gay newspaper has turned to crowdfunding to stay afloat, after legal costs following a series of defamation threats and settlements put its future in jeopardy.

In a crowdfunding application on Pozible, the Star Observer’s chairman, publisher and editor called on readers to pledge $75,000 towards the publication, after a “perfect storm” of factors left it in danger of closure.

It’s been a tumultuous few years for the Star Observer. Founded in 1979 as The Sydney Star, an Oxford Street-centric local rag, the newspaper merged its Melbourne and Sydney editions to create a national newspaper in November 2011. In April this year, the Star Observer underwent another change — from a weekly newspaper to a monthly magazine-style product. At the time, publisher and CEO Daniel Bone said the change would help the publication focus more on features and investigations, while news could be covered in a more timely manner through the publication’s website.

“Times are tough for all newspapers, and Star Observer is no exception,” Bone told Joy FM in March. Four months on, the publication still uploads five to 10 news stories a day on its website, keeping that ticking over as its reporters focus on long-form content for the print publication.

Speaking to Crikey yesterday, Bone said readers had responded very well to the long-form content. “We’re covering a lot we weren’t able to before,” he said, and nominated the upcoming August issue as his favourite in years. But securing advertising in what is, in format and content style, a new publication has taken some time to get off the ground. And legal payments and costs have stretched the group.

It’s not as easy as you’d imagine to convince large organisations or corporate to market products within the gay community,” Rice said.”

The Star Observer has long prided itself on being the Australian gay and lesbian community’s journal of record, and it does its share of investigative reporting. But it has been vulnerable to legal threats. In 2009, the Sydney Star Observer, as one of the pre-merger papers was called, reported on the circumstances surrounding a police officer who was suspended for telling a man in custody that he was “rooting a bloke”, a reference to the incarcerated man’s transgender partner.

The police officer brought a defamation suit against the paper and others in a protracted legal case, and the Star Observer’s publishers eventually settled. And Crikey understands there may be other legal threats to the paper. In an interview, chairman Sebastian Rice said the costs of legal advice had already been incurred. “There’s a series of legal cases we’ve worked through or almost worked through. [The crowdfunding campaign is] to help us get through the ongoing threats.”

The money, if successfully raised, will also help restructure the business. A failure to raise it could be dire — potentially leading to job losses or the scaling back of coverage.

“If we don’t end up raising money … we’ll still be facing these threats and won’t have the money to help us do that,” Rice said. “That will have an immediate effect on how we can deliver services into the future. We’re a small organisation. We rely a lot on people who work very long hours and often volunteer significant amounts of their time.”

The Star Observer has expanded its coverage and brief in recent years, becoming national in focus and vastly growing its audience through its website. But it’s been forced to make do with fewer resources. It’s funded almost entirely by advertising and so has been vulnerable to the shrinking ad rates plaguing the media industry. And while the paper has expanded and the number of advertisers willing to book ads in the gay publication is growing,  its national audience requires national advertisers. And this can be a tough ask.“It’s not as easy as you’d imagine to convince large organisations or corporate to market products within the gay community,” Rice said.

Still, when Crikey spoke to him, Rice was hopeful of raising the money. “We have a significant reader base,” he said. “We have 100,000 online readers a month. And the circulation for our printed magazine is another 13,000 or so. None of these readers would normally pay anything to enjoy our product. But we’re confident there’s enough grassroots support out there for people to contribute some pocket change.”

The campaign has so far raised nearly $10,000, with 16 days left to run.

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