Jul 2, 2010

It’s a small economy (formerly world) after all.

On Thursday I attributed the failure of The New York Times’ hyperlocal project in New Jersey to a bad business model. Its reliance on unpaid labor meant there was no need to generate revenue, which proved to be its Achilles’ heel when the volunteers and student interns didn’t materialize.

I still think this model sucked, but it wasn’t just a bad business model. It was the wrong business model for that area. Here’s why.

To keep the New Jersey Local running, The Times would have needed a large pool of unpaid student interns. They have that for their New York hyperlocal sites, with more than 480,000 students in the City University system, which includes a J-school and at least two colleges with strong writing programs. CUNY’s J-school already mans the Brooklyn Local, while students from New York University’s journalism program will work the upcoming East Village Local in Manhattan.

The Local didn’t have that in its New Jersey beat, which covered Maplewood, Millburn and South Orange in Essex County. Seton Hall University sits in the middle of South Orange but has an enrollment of only 10,000 students. Nearby Montclair State University has 18,000 students, and the Newark campus of Rutgers University has 11,500 students. There wasn’t enough wiggle room for error or missed partnerships.

The take-home lesson from the New Jersey Local experiment is this: Hyperlocal business models aren’t always about scale. What works in a large market won’t necessarily shrink to fit a small market. Instead, hyperlocalists must put attention into their beats’ microeconomies. If a neighborhood can’t support a news outlet’s business  model, then that model needs revision.

For example, my former hyperlocal site’s business model relied on advertising revenue. However, my coverage area was underdeveloped as far as businesses and services go — advertisers didn’t exist, and The Great Recession didn’t help. On the flip side (and contrary to what was happening across the larger region), the neighborhood had plenty of homeowners’ associations unaffected by the mortgage crisis and very active in civic affairs.

My for-profit company spent three years trying to tap blood from the advertising stone. It would have been better off as a nonprofit funded through donations from those homeowners’ associations. Woulda, coulda, shoulda.

Scale does not equal sustainability or solvency. That goes for The New York Times and independent hyperlocal outlets. But an appreciation for what a neighborhood can support will go a long way.

Photo courtesy of Flickr user pillowhead designs.

Jul 1, 2010

Why did The New York Times fail in New Jersey?

As I’ve mentioned previously, I have a love-hate relationship with The New York Times — love the writing, hate the elitist aftertaste.

Thus it was with both sadness and schadenfreude that I learned Wednesday of the demise of its hyperlocal project “The Local” in northern New Jersey. Just like that, The Times pulled the plug on The Local’s coverage of Maplewood, Millburn and South Orange and dumped its archive on hyperlocal pioneer BaristaNet, Business Insider reported.

Why did The Times’ “experiment” fail in New Jersey when it’s met some success in Brooklyn and is expanding into Manhattan’s East Village? What happened?

The way I see it, the New Jersey Local was hit with a one-two punch as it swaggered out of its corner. First, the news site saw editorial turnover in December, twelve months into what would eventually be a 15-month run. It can’t be easy for any news enterprise to recover from that kind of blow so early in its operations.

More troublesome (to me, anyway) was its business plan. The website’s goal was to rely on volunteer writers and unpaid student interns for its content. The Times already leans on students from CUNY’s J-school and New York University to fuel its Local sites in New York, yet it couldn’t ink a deal with Seton Hall University, which sits smack in the middle of what was the New Jersey Local’s South Orange beat.

In the end, “it couldn’t find the right partnership,” Times associate managing editor Jim Schachter told Business Insider. On top of that, the Jersey website didn’t have the resources to hire a full-time reporter, Schachter added.

Of course it didn’t have the resources to pay a reporter. The Local had no intentions of paying its other contributors or student interns, and an unpaid labor force means no overhead and no need to create sustainable revenue streams. It never anticipated the need to hire someone when the volunteer pool ran dry and the student interns never materialized.

One might also make the argument that The Times left too heavy an editorial imprint on the Jersey Local. The Old Gray Lady has an uptight, institutional voice that works on Park Avenue but not necessarily on South Orange Avenue. Conversely, BaristaNet’s tone is more engaging and, arguably, better suited to local and hyperlocal coverage.

But don’t blame the Jersey Local’s demise on competition from AOL’s Patch affiliate. According to Compete.com, the Jersey Local had 19,635 unique visitors in May, compared with 7,745 for Patch’s South Orange site.

Image courtesy of Flickr user Zooomabooma.

Feb 1, 2010

Stay classy, journalism!

In a terrific blog post, UC-Berkeley J-School adjunct Alan D Mutter equated dirt-cheap “filler” journalism — the fluffy kind performed for “exposure” or some pittance of a fee — with empty calories. That kind of content fills pages but offers nothing to local, state and national conversations and devalues quality journalism. And it’s why journalists should demand compensation equivalent to their time and labor, he argued.

Can I get an amen?

Mutter’s argument against devaluation is why I fear the marriage of big news outlets with local journalism schools. For example, The New York Times last month announced it was partnering with CUNY J-School to produce content for two of its hyperlocal ventures in Brooklyn. The J-school students will be responsible for reporting as well as recruiting citizen journalists, while their professors will keep editorial tabs on things.

It’s great that budding journalists will earn experience, but will they be paid fairly for their work? I hope so, but I won’t bet the bank on that one. Instead, the Times-CUNY arrangement smells like the exploitation of a relatively skilled labor force willing to work for nothing more than a byline, exposure and a good grade.

Teaching student and citizen journalists that craft and livelihood are incompatible is the wrong lesson. Instead, quality journalism should be rewarded, unless the craft is willing to lose true talent to higher-paying positions in marketing and public relations.

And what does this say about The New York Times, a company that pays its staff reporters $92,500 annually, according to The Newspaper Guild? It tells me they’re willing to offer good hyperlocal news, if only because it’s the publishing world’s revenue flavor of the month. But it also tells me they’re not willing to pay for reporters who will stick around after graduation.

Transient reporters aren’t good for any beat, but especially for the hyperlocal one. It takes time to develop contacts and to learn a neighborhood’s quirks. If a newsroom flushes that away with each graduating class, then any prospect for hardcore investigative reporting is lost.

Let’s teach student and citizen journalists the true value of their work.

Photo courtesy of Flickr user Stephen Poff.

Full disclosure: The New York Times isn’t the only publication working with journalism students and citizen journalists, but I do enjoy picking on them.

Jan 21, 2010

I can haz pay wall?

Full disclosure: I have a love-hate relationship with The New York Times. Its snooty, aloof tone rubs me as elitist, yet its comprehensive coverage and generally strong writing keep me coming back.

It’s for the latter that I would pay a monthly subscription to jump The Times’ pay wall, announced Wednesday. Don’t know what it’ll cost me. Don’t really care. Just give me unlimited access to Mark Bittman, and send me the damn bill.

But how does this announcement pay off for hyperlocal news sites?

First, it reminds news consumers of the concept of supply and demand. If readers are jonesing for information, then the journalist producing that content should be compensated appropriately for providing the fix.

Second (and perhaps more importantly), the pay wall concept reminds hyperlocal journalists that their time and energy are worth more than the reader’s appreciative pat on the back. Hyperlocal news has civic value. Now let’s give it monetary value.

That’s not to say that readers will pay to read about local businesses or municipal politicians. Believe it or not, that kind of news eventually leaches into the community, whether the hyperlocal news source reports it or not.

Instead, hyperlocal news sites can repackage distinct material as “premium” content. Weekly entertainment calendars, restaurant reviews, and real-estate articles can be placed behind a pay wall (or under a guard kitty, above) or emailed to readers for a subscription fee.

For some publications, this means no additional work beyond billing and distribution, though those are no small tasks. For others, it may mean producing new content. Either way, it’s one revenue stream to consider, made possible by The New York Times.

Photo courtesy of Flickr user dominicmercier.