Will Hyper-Local News Work?!?

Listeners of the World,

OurTown, Patch, Topix, Everyblock, Placeblogger, The Loop, Outside.in, and the list goes on and on and on........these are "Hyper-Local News" and "Local News Aggregation" sites that have been founded in the last 5 years. Many different people and large corporations have been trying to fill the huge "white space" on the web that is hyper-local news, and in my opinion nobody has figured out the special recipe just yet!

There are many different factors to take in when starting a hyper local news site, some that just leave many scratching their heads. You need to create a model that will allow your contributors (or local editors) to make money giving them an incentive to contribute in the first place, while keeping in mind that you need a way to turn a profit as well to be able to keep the network alive! This I have found is the main problems with bigger networks (Patch, Topix, etc.). They create this network, but do not build in enough ways to generate revenue to actually let them make a profit......I mean from reports it looks like the most successful network is Patch with its 22 Million in revenue, but then you look at its spent which is 160 million!! That does not add up very friendly for the folks over at AOL.

Another main problem is figuring out the right workload for the individual editor / contributor. Many of the bigger networks have found that hiring someone within the actual area is the best way to go (which is the same for us here at OurTown), but then the question comes of how much to we expect out of this person? Many put the person in charge of all the content that goes on the site, where others put then in charge of the entire site, and others put them in charge of every aspect of the site. It becomes very hard to judge what a person can and cannot handle and with most of the sites just adding more and more work to each editor one begins to wonder how is all of the work going to get done?

Next problem is finding the right people for the job! There are many people out their that love to write, but you have to find someone with a "hyper-local news mindset" - meaning someone who is willing to work hard, write stories, curate an entire site, answer questions, be out in the community, become a self-promoter, plus more! It is not enough to just love writing to become an editor in most cases, which makes it a lot harder on the company to get enough of the right people in the door. Let's take two of the biggest networks in Patch and Topix.....It took Patch 160 million to get under 1000 local editors (that should get you a lot more) and then Topix got to around 3000 contributors, but then it turned into childish commentary and scandals instead of news that matters for the community. So in any case it is very hard to get a good amount of the same minded people who will make it work!

The last big problem I will mention here is getting the right viewership for these sites. There are many choices for news across the board (Newspaper / TV / Radio / Magazine / Internet) and some people (hard to believe, but true) just don't care about what is happening locally. They care more about world and national events, which is fine, but not the focus of a hyper local news site. You need the people who care about what is going on in the community, and people who care about the little story (little by national sites standards). You need to be able to reach out and touch the community, get the conversation started on YOUR SITE. That is the key!

Now with all of these problems, questions, and issues from above....one may ask - why even try? Well the reason is simple and that is because it's important and people really do care about that type of news. We have changed OurTown a lot since the site first went live, and I am sure we will be changing it a lot more in the future. We feel that we are really close to getting the "right recipe" and hopefully one of will get it!

Your OurTown Superhero,

Chris

Patch.com expanding...but at what cost?

Listeners of the World,

Traditional news had transformed over the past decade from local and national newspapers / magazines to online / hyper local and global news sites! With this transition local newspapers are dying out while the national papers are making huge cut backs and scrambling to get their news online. This has lead to many different online news sources that take a different approach to local news. Many are taking a hyper local approach to give their viewers true local news that won’t be covered by the bigger news sources. Because of this, sites like OurTown, Topix, Americantowns, Everyblock, and others have become very popular and are now trying to take over the whole hyper local space which most experts value in the billions!

Since there are so many different online news options in today’s world I decided to look over many of the sites to see how they are planning to take over the space, and one stood out from the rest…….Patch.com. Patch is an up incoming hyper local website that is now in about 24 states covering over 100 cites which seems very impressive, but how did they manage to accomplish this? Well from what I have read and research about Patch it is a interesting and bumpy ride…..so hang on!

Patch started as a small hyper local news start up in California founded by Tim Armstrong (Now CEO of AOL) which was sold to AOL in June of 2009 for $7M. Of course this was after Mr. Armstrong became the CEO of AOL (which gave him a nice early payday I might add). After the purchase AOL then decided to pour $50M into Patch that same year.

Then AOL went on a “buying spree” of online news sources like Techcrunch, and HuffingtonPost trying to strengthen their online news site – Patch.com. Once they purchased these sites they started having their articles appear on patch and then made Arianna Huffington the in charge to oversee Patch.com.

Now will all this money / purchases being poured and combined into Patch it is hard to say how one competes with them in this space, but you also have to ask – how long can they keep this up? The amount of money they are spending eclipses almost all of the other hyper local sites budgets combined! Many experts and Ex-Patch employees say the business model isn’t sustainable and that as of right now they can’t understand how they will recoup all this money they are pouring into it.

Patch boasts about their sales force of over 100 people to help sell advertising on their sites, but when you go to a Patch site…..you don’t see too much advertising on it! Also they boast about their great updated business directory that in reality leaves out a lot of newer small business and is obtained in a “not so upfront” way. I have talked many business owners and ex-directory employees from Patch and have learned about many unsavory techniques that they use to get the business information and pictures! I have also talked some individuals about their local editors and journalism staff who they call ruthless and disrespectful when it comes to not wanting to cooperate with giving them information on a story (which a lot of their articles aren’t news at all).

Overall Patch.com has a good strong base of local sites and viewers, but at the cost of over $100M! They don’t seem to be generating a lot of local ad sales and their stories are becoming less and less news breaking. Patch is in the lead for obtaining the online hyper local space, but at what cost…….

Your OurTown Superhero,

Chris

Patch!!!!!

Listeners of the World,

If you haven't heard (which I would find it hard to believe at this point) the internet giant known as AOL has created its own hyper local news site named Patch.com! Many people have been talking about and learning about the new site over the past year as it has tried to move across the US. Below is some of what we have learned!

Patch functions in similar ways to OurTown with having a local editor from each area being in charge of the individual site. But, Patch is very different in the way that local editors are paid a base pay and do not get anything for the local ads. They also are spending about 30 million a quarter to run the site itself! Both sites promote communities on a very local platform and are setup for people to contribute articles, photos, events, etc. And both sites focus in on local stories and businesses.

Many people have tried to look at Patch and come up a business plan that makes sense or lets them turn a profit.........and many have failed to do so. I have heard from current Patch editors and former employees that there seems to be a lot of confusion/waste in the process and do not believe that Patch will be a success. Also, many articles have been written about Patch.....calling it un-newsworthy.....waste of money......flawed business plan and so on. They have not been too nice to Patch even though it seems like the site has been gaining a lot of attention!

Even with all of this we see Patch as a big competitor and are shaping our new site to be able to overcome this giant! We will have different features and focuses from what Patch is doing, which we think will win in the end.

Many say it will fail, and they think it's the future. Only time will tell, and only you will decided!

Your OurTown Superhero,

Chris