Hyperlocal News Needs Social Networking

I’ve argued for some time that hyperlocal news is the future of newspapers and today’s article in the NYT points out several ventures that are trying out this model. These startups, however, don’t really utilize social networking, and they are missing out on something big. I think that is because they are thinking of social networking as Facebook or MySpace, which is very self-oriented. The kind of social networking that will work in hyperlocal news, however, is the old-fashion “community” features that were popular in the early days of the Internet. Well-organized forums and discussion boards are key elements.

Hyperlocal newspapers need to highly engage their readers primarly for three reasons. 1) Readers can provide content. 2) Readers create market, and 3) Readers attract readers.

No.1 is pretty simple. In an environment where a newspaper is run by one or two editors (who should have very strong editorial standards and good journalistic skills) there is always a need for citizen reporters. If there is a fire, your best bet is that the people in the building, people across from the building, and people on the street are going to provide the fastest news. A Twitter-like “breaking news” feed can be added to the site; even if some people put up wrong information, the turnover of the content will be so fast that it won’t really matter that much. Citizen reporters can also be a good source in providing community events news.

No. 2 is interesting in that it brings back the old cash cow of legacy newspapers. Although ads can help with revenue, there is nothing like the old-fashioned classified that can build profits through microtransactions. Although there are sites such as Craigslist or Monster, there is a limit to what they can do for a hyperlocal community. Allowing people to post classifieds for a small fee (but allowing people to view it for free) is a way to get more traffic to the site and bring in some money. Hyperlocal newspapers can also charge for featured obits, marriages, or other corporate/family PR.

No. 3 is a no-brainer. Hyperlocal news is bound to attract discussion, and it is the discussion that will keep readers coming back. The important thing is that the commenting tools should be more sophisticated. Most commenting tools now are linear, but they should be arranged in a way that give them hierarchy, because sometimes you want to comment on a comment instead of on the original article. Because there is a slight learning curve for people who do not use the Internet, the Knight Foundation should not be funding individual newspaper projects. Rather, it should be using that money to create an easy-t0-use site builder and educate journalists how to utilize this business model.

Using social networking tools to get readers involved is extremely important, because at the end of the day, they will be the ones paying for the newspaper. Let’s look at the figures:

Simple and not-so-simple answer to future of newspapers

My dad was in town for a conference last week and so we went down to New Haven to see my sister for a few hours, where most of the conversation that we had (when not playing games on the Wii) was about the Kindle 2. Now my sister is a digital native, my dad is an elderly gadget whore, but both are voracious consumers of a range of multimedia (from text to audio and video), so it was interesting to listen to their thoughts about the Kindle.

Having been in the print industry for several years and being currently involved in a case where the recording industry is suing a student for downloading files via p2p, I worry about the future of the Internet. I disagree with Jonathan Zittrain because I don’t think that people will want tethered devices because they want more security (so you could say I’m a fan for all the wrong reasons). As far as I see it, people are pretty simple; as long as someone else takes care of the security, they’ll be fine– so it doesn’t matter whether or not the device is tethered or open; the thing that does matter is whether or not there is a good A/S system that can shoulder all responsibilities and an interface that is easy to navigate.

However, I agree with JZ that tethered devices are dangerous; and I think it will be the content vendors that push for tethered devices, because those devices allow the content vendor to monetize their content (take a look at iphone apps for example… you also probably know the argument about how the nyt can save money buying their readers kindles. Newspapers and record companies could continue to make money if they could control content through tethered devices. It would be different from DRM because people could be allowed to share via blutooth, which still has enough physical constraints that it is not as damaging as p2p. It’s great that content developers have a way to monetize but the model can be abused. Look at the iTunes store– apple is in a god-like position to control the prices of the songs Had it not been for competitors like Amazon, Apple may have raised all prices of its songs instead of lowering some and raising some.

You may argue that in a DRM-free environment, people could always download songs on their PC and transfer it to their phones, or ipods, or whatever. But what happens in a world where the majority of people don’t have separate computers? We’ve been talking about convergence for such a long time, but convergence has mainly happened between mobile gadgets. For instance, now the iphone is an ipod, phone, multimedia player, and mobile game console rolled into one. But we are soon looking at an age of mobile computing– where there will be no need to have a separate computer and a smartphone.

Of course, developers, graphic designers, and people who use the computer for professional purposes may still need desktop computers, but the bulk of the population won’t.When on the go, they will use their mobile devices; at home, they can then plug in that device to a large screen that can double as a TV. What with the falling prices of flat screens, I wouldn’t be surprised if, in the future, all classrooms were equipped with flat screens at every desk and all rooms at home have flat screens.

I’ve strayed to a completely different topic. Let me go back to the Kindle.

Before we kill ourselves with pessimism, we can be excited about the fact that people are willing to pay for quality content on these tethered devices. (I know my father and sister are not a fair representation of the rest of the world, but still.) How do we apply this to the general Internet? Why is someone willing to pay for the NYT on the Kindle but not on the Internet? Well, for one thing, everything’s for free on the Internet, so duh, why would you pay for it? But the NYT tried the premium model and even that didn’t work out, right?

In the end, I think it’s about financial transactions. People are willing to pay for content as long as it’s super-easy. (I’d love to do some experiments on this) So this changes the questions we should be asking. How do we make online payment easier? Does this mean we should let ISPs be the middlemen for all online transactions? How will we maintain security of financial transactions when everything is virtual?

A Pulitzer Prize for Global Journalism

The Pulitzer Prize is the shining medallion for journalists, one that is revered, flaunted, and used to prove one’s contribution to the industry. Yet it is only about America. In the journalism category, newspapers must be U.S. papers; in the letters category, publications must be those published in the US by American authors, the only exception being if you write about US history.

That’s fine. Certainly Pulitzer doesn’t have obligations to cover the entire world, and for literary works, there is the Nobel Prize although it would be nice and more along the lines of true journalism if it weren’t so nationalistic (The Nobel is incomparable to the Pulitzer- far less are given out every year).  I just think it’s very sad that the award that has become the staple of recognizing what is good journalism and not is only focusing on the United States. It’s even more disappointing that they are accepting online news but not global news.

You may argue that other countries have their own awards, but no award is internationally renowned as the Pulitzer. In Korea, there is a journalism award, but your publication has to be a member of the Newspaper Association in order for your article to be considered. That is not fair, because a newspaper’s alliance with a labor group is a political decision, which shouldn’t affect decisions in which articles are good or not. Forgive me if I am sour about this because the paper I used to work for was one of the three biggest national papers and we weren’t a part of association (actually seceded from the association but that’s another story).

It is true that journalistic standards, ethics, and such in other countries are in some cases, not on par with U.S. standards. But sometimes they are, and sometimes, there is a lot of excellent reporting. Those efforts should be acknowledged. Newspaper design, for instance, is acknowledged by the Society for News Design, and you can see that a lot of amazing designs come from all around the world.

There are a number of small prizes for a global community, like the Bastiat, Knight Awards, and numerous others, but they all cater to a specific topic or demographic.

It would be wonderful if some organization could begin a global journalism awards that is comprehensive like the Pulitzer. Especially now, with new media endangering quality journalism, such incentives are needed to inspire journalists. Journalists don’t work for money- they never have- all they want is to communicate to the public, hoping their efforts in seking truth will be respected. Journalists are being stripped of their honor and without honor, there is no reason to be a journalist.

Future Business Model for Newspapers

I love print. I’m sensitive to the paper- the texture, the weight, the smell. Did you know that thinner paper is more expensive to print than the 100g glossy ones? The paper itself may be slightly cheaper, but thin paper could tear and so the presses have to run slower. Of course, if you are shipping or making prints more than 50,000, thinner paper is cheaper- which is why you see more glossy, thick paper in magazines. Of course, magazines’ editorials lean towards the “glossier” side too, so you may see it as a chicken and egg thing. I love fonts, the graphic design of print layout, the beauty of words… all of which seem to have lesser meaning as we move into the digital age of news.

But how will newspapers survive? Clearly their current business model (relying 90% on print advertising) is not sustainable. Ethan Zuckerman suggests that newspapers’ CPM doesn’t make sense. I agree, but only because now, we have the web as an alternative for marketing. The high CPM of newspapers in the past was the cost advertisers paid not only to encourage sales of their products, but to also sell their brand, make an ego statement. It was a price they were willing to pay, and that high price barrier made advertising in newspapers all the more supportive of their ego.

Then comes along web advertising, which is, in many aspects, entirely different. Web advertising is not so much making a statement, but getting sales. Conveniently, one can track how effective one’s web ad is. Print media now has competition, and competition (in the free market) drives down the price, right? With more advertising mediums (Internet, mobile… who knows what will come next?) it’s inevitable that advertising prices go down. Newspapers should have seen it earlier- it was so obvious- and quickly adjusted their business model.

Will web ads make up for their losses? Never in a billion years. Do the math, it’s not going to work. Even if all the articles were porn-laced content that gets high traffic, it won’t work. That is why- in addition to the journalistic reasons- it’s not financially worth it to write trashy articles. It may get you a few extra bucks, but it won’t be enough to pay another full-time, quality reporter. So what do we do? You can only cut capital costs (printing, delivering, etc) to a certain extent and cutting human resources (your reporters and editors) may save in the short-term, but will put you out of business in the long term because if you don’t have good, original content, no one will bother to read you anymore.

I don’t have a solution for national newspapers, but I have a suggestion for regional newspapers– something that would only work when it is targeting a community that is geographically specific. Local papers should actively engage citizen reporting to produce real-time news only for its (free) website, and publish a weekly paper newspaper that contains more feature stories, op-eds, lifestyle stories, etc. (A couple pages can be used to publish briefs on major stories from the past week) The reason this needs to cover a small area is so people can personally relate to information that they would otherwise have no access to. National news can be obtained everywhere and it will be impossible with a small staff to cover anything better than what other papers have covered.

Social networking is a key point in getting people to visit the website, by letting them pitch tips, and participate in discussions. I found that online forums take on more life when they are hyper local, because the issue at hand is always very close to heart.

The local paper shouldn’t have more than five full-time employees and doesn’t require a huge office– it doesn’t have to have an office at all, except that the weekly paper production would be easier if the staff were together. Frankly, I think two or three editors is all that it takes to run a local paper, as long as it actively engages the community, utilizing freelancers, collaborating with local bloggers, etc.

In addition to print and web ads, local newspapers have the advantage of making money from hosting local events because it has such strong ties to the local community and its brand name. When I was running Ewhaian.com, I had no idea this could be an actual way to earn money until I saw that offline events were bringing in much more money than online ads, and that the events were not only profitable in terms of finances, but also good in bringing more content and more people to the site. Of course, this involves having people who are event planners, not necessarily journalists.

We are at the brink of facing at least a decade of degrading journalism. Newspapers have to wake up. Here is an interesting business model about a regional paper that is charging its readers and working on technology to make a “closed” web site. I don’t know if that’s the right direction, but it is an unique success case.