I respectfully disagree with Bob Garfield. I’ll come out and say it. I admire his work and enjoy his program. But on the question of hyperlocal media, I believe Bob is wrong. In an interview with Borrell Associates, Garfield said that hyperlocal news ventures are doomed and that no one outlet can attain the critical mass necessary to deliver the local news professionally and profitably in the future. I beg to differ and will reiterate some of the themes I have covered in the past but are worth repeating.
First, let’s cover where Bob is right. Applying the traditional advertising-driven model and corporate structures to hyperlocal will not work. Most hyperlocal efforts by big corporations such as AOL and Gannett have either not been profitable or not been profitable enough to merit continuation. Some Patch sites, according to AOL CEO Tim Armstrong, are now profitable and it’s possible that Patch could scale to run profitably.
Still, there are no barriers to entry to the hyperlocal market and competition comes not only from traditional suburban papers but also from all manner of local mommy blogs, local sports sites, and restaurant review sites such as Yelp. Bottom line? The economics of a news outlet must be radically different, even at the national level and moreso at the hyperlocal level where the audience sizes are relatively modest in comparison.
Those economics can be made to work, however, given the right amount of elbow grease, advertising smarts and, most importantly, a commitment and connection to the community. I’ve written a number of times about West Seattle Blog, a mom-and-pop hyperlocal blog that pulls in over 1 million page views per month and is solidly profitable. At West Seattle, a day of postings could include a dozen items, each piece unique and expressly local. Often, these posts are timely. A dozen news posts a day is about four times more than what I have seen in my local Patch blogs. It takes commitment to get that many posts up per day. It’s a grind. But it’s doable and it drives traffic, if the posts are substantive and valuable.
West Seattle uses a rotating cadre of display ads purchased by community-minded local merchants. This is fairly crude in terms of advertising. But it works. So I wonder what the economics would be like when more sophisticated forms of advertising work their way down to the hyperlocal level? By this I mean ads that could more easily target user behavior or deliver content from the advertisers to site visitors. Rather than just a rotating list of ads, sports sections could only carry ads for sporting goods stores, school supplies, electronics and restaurants. With Twitter and other real-time microblogging tools, merchants can integrate hourly deals into the local blog spots in order to, say, take advantage of bad weather (BOGO hot cocoa at the local coffee shop, anyone?).
At the same time, Garfield’s comment rings false because it seems to ignore the entire recent history of online media. Tech blogs running on shoestring budgets as compared to their traditional media tech pub brethren break news; garner equal if not higher levels of page views; and become, for all intents and purposes, mainstream media. They were able to do so by tapping technology developments that enabled dirt-cheap online publishing and the Internet, a research tool that made it infinitely easier to write content quickly and authoritatively.
What’s more, we are in the first inning of the development of these types of tools. Palantir builds amazing tools that allow users to quickly pull together and visualize a huge variety of government data sets, providing insights that previously required months or years to glean. OpenCalais, from Thomson Reuters, is an open source data parsing tool that can help reporters pull out highly-relevant contextual information from reams of text documents (court files, for example). Narrative Science (yes, I write about them a lot) takes structured data and turns it into consumable prose. Tackable, Rawporter and Meporter enable distribution assignments and make it far easier for even small groups of individuals armed with smartphones that have HD video capture and high-resolution cameras to crowdsource news gathering.
It’s so early in the new news game that I’d venture online news will enjoy more significant changes in the next decade than it has in the last — and that’s saying something, considering that the last decade saw the rise of the broadband Internet and smartphone saturation. Ironically, the very same week that Garfield nailed the coffin shut on hyperlocal, we read about how NPR used localized Facebook targeting to jack traffic on some of its articles. Smart! Very smart!
So, the point being, the models are still forming but I have no doubt that we will see a vibrant ecosystem of profitable hyperlocal publications. They will not be as profitable as the old quasi-monopolistic news system when a single daily drove the news cycle for an entire town. They will need to be driven by passion and commitment because the necessary dose of community participation can smell naked profiteering like a skunk trapped in an In-n-Out Burger bathroom.
They will need tech chops to keep their cost structures low, to take advantage of developing tools that empower detailed data-driven reporting, and to deliver the types of content-driven, audience-driven ads that will be required to best serve both advertisers and readers. In an era when the community commons has been replaced by Facebook, the news that feeds healthy communities must change and will change. Last time I checked, Facebook was doing pretty well. Give it time and hyperlocal will do well, too.
Alex Salkever is an executive at a cloud computing company and a former technology editor of BusinessWeek.com. The views expressed in his column are his own and not those of his employer. His Personal Fight column appears every Wednesday on Street Fight.