This today in CommonWealth Magazine –
Trying to Patch the sinking news lifeboat
Soccer is the game of the future, its deriders have long said, and always will be. After the latest news that Patch, the pet project of AOL CEO Tim Armstrong, has laid off two-thirds of its remaining staff, you have to wonder if hyperlocal news sites are becoming the European football of journalism.
About two weeks ago, AOL turned over its majority stake in Patch to Hale Global, a technology investment firm specializing in turning around troubled assets. In Patch, it has its work cut out for it, as the reporting and aggregating sites have lost up to $300 million since Armstrong launched them in 2007 when he was at Google.
The ax fell on hundreds of staffers in a cold conference call by Patch COO Leigh Zarelli Lewis, whose blunt, matter-of-fact, mass-firing contrasts with the hyperlocal focus the company tried to build its foundation on. Unsurprisingly, one of the enterprising (now-unemployed) journalists on the conference call recorded it and handed it over to media blogger Jim Romenesko.
“Hi everyone, it’s Leigh Zarelli Lewis. Patch is being restructured in connection with the creation of the joint venture with Hale Global. Hale Global has decided which Patch employees will receive an offer of employment to move forward in accordance with their vision for Patch and which will not. Unfortunately, your role has been eliminated and you will no longer have a role at Patch and today will be your last day of employment with the company. …Thank you again and best of luck.”
Romenesko says as many as two-thirds of the staffers at the 900 sites in 23 states were laid off, while Fox Business says just 100 staffers – reporters, editors, and advertising reps – remain to populate and sell space on the sites. Patch officials say all the sites will remain active but it’s hard to imagine they’ll be more than zombie sites, aggregating local feeds and offering bloggers a place to write. In Massachusetts, one of Patch’s prime regions, there are at least 82 sites. But who remains where is anybody’s guess.
Patch’s problems are not surprising to anyone who has watched. Back in August, AOL laid off nearly half of the 1,100 Patch staffers and the constant hemorrhaging of money nearly cost Armstrong his job. Not only is Patch competing with hyperlocal sites that are truly boots-on-the-ground in their communities, it is butting heads with legacy media that are also trying to leverage their news-gathering organizations and lay claim to their surrounding regions.
When GateHouse Media was formed about six years ago, it bought up more than 500 existing daily and weekly newspapers around the country, including such venerable institutions as the 175-year-old Patriot Ledger in Quincy and the State Journal-Register in Springfield, Illinois, where Abraham Lincoln awaited word of who would be the Republican presidential nominee in 1860. But while those outlets gave the company instant access and instant credibility, the idea was to turn those assets into hyperlocal sites, which they dubbed Wicked Local. But, given the recent sale and bankruptcy of GateHouse, they, too, have yet to figure out a way to monetize their sites.
The Boston Globe also dabbled in hyperlocal content, launching the Your Town sites on boston.com. But the sites are mostly aggregators and bloggers, failing so far to live up to the hope and promise of their launch.
It’s a vexing problem, how to make a living off providing news, especially at the local level. Local media critic and Northeastern University professor Dan Kennedy examined new age journalism in his book “Wired City,” focusing mainly on the New Haven Independent. But Kennedy also spotlighted some other seemingly successful ventures at the local and national level.
And there clearly are success stories. Here in Massachusetts, Universal Hub and The Dig have been able to find their niches. Perhaps that’s the lesson for megaplayers such as Patch and GateHouse. All news is local. The operators should be as well.