What If Rupert Murdoch Tried to Out-Patch Patch | Street Fight

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What If Rupert Murdoch Tried to Out-Patch Patch

0 Comments 28 February 2012 by

For many media companies, AOL’s $160+ million Patch experiment probably looks like a cautionary tale. With the network’s more than 860 town-sized sites bleeding money month after month, many major players might be tempted to see their troubles as a sign that the concept of a scaled hyperlocal news network remains an elusive white whale, forever confounding foolish Ahabs.

But here’s a thought: What if Rupert Murdoch’s News Corporation decided to create its own version of Patch. Could the company that brings you Fox News also deliver the news from your block? And could it do that better — and more profitably — than Patch has?

The answer is: maybe. But would Murdoch really want to go local?

There’s certainly money in local — a huge, growing market of untapped advertising dollars that are migrating from print to online. And Murdoch has never been known to shy away from a challenge.

One advantage he’d have is that Patch’s fits and starts have provided a solid beginning point for any large corporation attempting to go hyperlocal on a massive scale. News Corp could avoid a few, if not all, of the mistakes that AOL has made. Media analyst Ken Doctor said in an interview that any new investment in news would “feed investor unrest.” But there are still some reasons to believe the venture could work.

News Corp already has Australian properties that could tie in nicely with a local content play. In Australia, News Limited runs TrueLocal, a local directory site that receives 8.6 million business searches every month. There would certainly be value in having editorial tie-ins (although how much might be an issue).

News Corp could own the education space (and stick it to the Times Company at the same time, a double bonus).

On American shores, News Corp owns the New York Post and Fox’s local affiliates. But it’s the company’s forays into for-profit education that could be a prime target for hyperlocal efforts.

The New York Times has been experimenting recently with education sites that are a combination of hyperlocal (because they deal with individual schools or districts) and universal (because they focus on educational issues). News Corp has a robust and expanding for-profit education division, led by Joel Klein, the former chancellor of the New York City Department of Education. It is not a huge stretch to see how a local angle could benefit this effort.

“They could do that,” said Doctor. “The Wireless Generation purchase pushed them that way. They could do it as an education play rather than a news play, although there is some potential overlap there.”

Doctor says it could be similar to Bloomberg doing Bloomberg Government on a national level: “If Bloomberg is successful in that in terms of servicing the contractor business that works for the Federal government, which is a huge number of people, then they are planning on taking that to other streams. It’s similar in a sense that News Corp. integrating [Wireless Generation] and making it their own is the first step, but in terms of local that’s an interesting theory.”

News Corp could own the education space by taking it local (and stick it to the Times Company at the same time, a double bonus). Imagine, a fleet of educational sites in major cities around the country, all talking about similar issues. Murdoch wants to help move education into the 21st century — not the least because his company stands to profit — and this would be a prime way to share knowledge. Done right, advertising on the sites could be sold both locally and nationally.

An education-focused local network would not be cheap. But it wouldn’t cost as much as Patch — especially not initially. And while $160 million is not nothing, Rupert Murdoch has shown he has some patience for editorial experiments that initially put him in the hole (see: The Daily and its projected $30 million shortfall). And a News Corp local play in education idea could lift up the entire space.

But according to Doctor, people hoping to see a News Corp Patch rival shouldn’t hold their breath: “It’s a nationally- and globally-oriented company. The news operations are about 20% of the company, and if you look at those operations, they are in Britain, the U.S., and Australia. They are generally internationally-oriented. That’s the kind of journalism they do; that’s the way they sell advertising. I don’t think they have the local journalism roots, and I don’t think they have the local sales organization or mindset.”

But hey, when there’s a market opportunity, there’s often a way — especially for Murdoch.

Noah Davis is senior editor at Street Fight. He previously covered media at mediabistro.com and Business Insider as well as during multiple stints of full-time freelancing. He has written for The Wall Street Journal, NYMag.com, Wired.com, SportsIllustrated.com, and many other publications.


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