[Each week, our friend Ken Doctor — author of Newsonomics and longtime watcher of the business side of digital news — writes about the economics of the news business for the Lab.]

Overnight, it seems, journalism has been transformed from a daily grind to an heroic quest. Rupert Murdoch has dubbed his adventure to get readers to pay for tablet (and other) content Alesia (after a Roman/Gauls battle) and now public radio formally launches Project Argo. Ah, journalists pursuing the golden fleece. Forget Woodstein — the pursuit of journalism itself is now an against-all-odds mythic trip against budget monsters and business model slayers.

If last year was the year of massive cutting, this is the year of new news creation popping up from unusual quarters. AOL’s Patch is probably the biggest hiring agent, with more than 400 new full-time jobs covering local communities. Sites like TBD.com and Bay Citizen are crafting new products and strategies and hiring dozens of journalists. Now Argo pushes forward, in a quest to stick a new flag of public media in terra incognita, and is hiring journalists in the process.

Argo is intended to bring a high level of attention to hot button topics, covered from a regional perspective. “We want to be the best means of authoritative coverage,” NPR Digital Media G.M. Kinsey Wilson told me recently. [We want] to be the top-of-mind choice for issues like immigration [now covered out of L.A. by KPCC with the Argo site Multi-American].”

Coverage is handled by the increasingly familiar reporter/blogger/curator, finding the most relevant coverage for readers. Largely providing a single new full-time position for each new site, “hosts” come from some impressive reporting backgrounds, like WBUR’s Carey Goldberg, former Boston bureau chief of The New York Times, and Rachel Zimmerman, former health and medicine reporter for The Wall Street Journal. Much of the content — and there’s an impressive amount at launch — is text, not audio.

At first, Argo seems hard to put in context. It’s public radio becoming public media becoming locally topical, but in ways that can inform more than local audiences — which we used to think of as public radio listeners, but who are now public media listeners and readers. Got that?

I’ve talked to a number of people in the emerging public media landscape — a fairly merry lot of Argonauts and other dragon slayers who see lots of upside — so let’s take a look at the emerging newsonomics of projects like Argo.

By the raw numbers, Argo is a $3 million investment. That’s not much by traditional journalism standards, but in this day and age, it wins headlines, like the minor economic development miracle of a new big-box store being covered on the Metro front. The money comes both from a foundation — the omnipresent Knight Foundation at $1 million — and from the Corporation for Public Broadcasting at $2 million.

That Knight funding reminds us of the good that’s still being done by the once dependable profits of newspaper companies, as Knight Ridder funding built one of the 25 foundations in the country, one that has been instrumental in seeding sprouts of the new new journalism.

That CPB funding reminds us that our tax dollars have been supporting news for more than four decades now, even as the debate rages abstractly on whether it’s a good idea to have “government” in the news business. NPR’s news effort — supported by members, philanthropists like Joan Kroc and yes, our tax dollars — makes a pretty good case that some government funding is a good idea, especially if we compare NPR radio news to what is elsewhere generally available in the growing desert of commercial radio news coverage.

Argo itself is 12 sites, produced by 14 public radio stations (two sites are jointly produced), each specializing in major topics like education, health, immigration, and ocean health, and exploring that topic regionally. Journalists are hired by individual public radio stations, each of which applied for the funding. The initial funding is intended to sustain the sites through the end of next year — and to provide “prototype products,” according to Wilson.

So that funding is one of the first things that tells us about the business of this effort. Like Silicon Valley startups, the effort is about building a product that seems to meet a clear audience need, building that audience — and then finding a sustainable business model. That’s what has built companies for decades in the valley, and it’s in contrast to how much of the journalism business has long gotten funded.

Looking under the covers, though, here are three more things to watch about the emerging economic model underneath Argo:

• It’s local and vertical. In the conundrum that the web has been for newsies, publishers often felt compelled to choose “local” or “vertical,” the fancy term for topical. Of course, readers’ concerns encompass both, and an education site that focuses on local education (such as Minnesota Public Radio’s Argo site On Campus) creates double value and may multiply audience. Even though, it’s “local,” just as WBUR’s CommonHealth, it will find national audiences as well.
• It’s built for networking. Public radio used to a fairly one-way street, with national NPR and then Public Radio International and American Public Radio essentially licensing or syndicating shows to local stations, of which there are more than 250. Now built on increasingly flexible technologies like NPR’s emerging API and PRX’s exchange, local stations can increasingly both syndicate their own work, Argo-funded and other, to each other — and pick up other stations’ work more easily. In a sense, we see an alternative wire in creation, especially as the Public Media Platform goes forward.
• It builds on public radio stations’ local news push. A number of stations represented in Argo have also begun building out their local/regional/statewide news presences. KQED, in the Bay Area, which is launching MindShift through Argo, just hired eight new news staffers as it launched KQEDNews.org (Good piece by MediaShift’s Katie Donnelly on the initiative and its context.) So in KQED’s case, as in WBUR’s, KPCC in L.A.’s, and Oregon Public Broadcasting’s, the topical initiative receives more play due to the expanded news reach — and the expanded news reach gets more public notice because of the new topical coverage.

Each of those factors are multipliers, multipliers of public radio’s emerging digital news business. They multiply audience. They multiple the ability to get members and membership income. They multiply sponsorship opportunities, the “advertising” of public radio. That’s on the business level. On the journalism level, public radio’s news values — the closest to newspaper’s traditional ones — get to flex their muscles, another early test of just how far public media wants to go in filling the yawning local news vacuum.