What We Know About the Business of Digital Journalism

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Columbia Journalism School | Tow Center for Digital Journalismsions. Though pricing is by the month, the site will oblige advertisers who wouldrather buy by the amount of traffic—hence the guarantee. And the Dispatch’smodest entry-level rates compare favorably with print alternatives.One of the Dispatch’s biggest challenges has been to forecast the amount ofad space, or inventory, it will have each month, because this fluctuates greatlydepending on how much traffic the site gets. On occasion, the site has had toturn advertisers away. To deepen and diversify its inventory without taking ontoo much risk in increased editorial costs, Hopfinger plans to bring establishedAlaskan blogs into the Dispatch under a revenue-sharing agreement.At first glance, the statewide profile of the Dispatch seems to set it apart fromsmaller local sites. But Rogoff and Hopfinger stress that Alaska’s agenda-settersconstitute a kind of village, one spread among Anchorage, Juneau, Washingtonand Houston. They share a narrow and well-defined set of interests: federal funding,government regulation, the oil industry (hence the Houston link), transportation,Sarah Palin and so on. One of the site’s most successful features is its “BushPilot” blog, focused on the small-scale aviation so critical to Alaskan life.“It’s like a small town,” Hopfinger says. “The flipside of that is there are fewerpeople and fewer businesses.” But he adds that the Dispatch has benefited fromthe kind of boosterism that smaller community sites enjoy. “You get an opportunityas an underdog. People want to see us succeed,” he says.An emphasis on a small and well-defined community sets apart most of theonline-only local news outlets that began to dot the Web about five years ago.These run, generally, from professionally staffed hard-news outlets such as theDispatch to news-oriented community blogs like Baristanet and West SeattleBlog. Wherever each site falls along that spectrum, none of these grass-rootsventures has either the assets or the built-in costs of local sites backed by establishednewspapers or television stations. (For a detailed discussion of costs,see Chapter 7.)The grass-roots sites also face a different set of problems than do large-scale,networked hyperlocal ventures such as Patch, and, to a lesser extent, the originalTBD. Patch is hardly a legacy newsroom. But it does have to succeed on ascale that justifies AOL’s vast editorial, infrastructural and ad-sales investmentsLocal and Niche Sites: The Advantages of Being Small 43
The Story So Far: What We Know About the Business of Digital Journalism(and that compensates for the company’s declining income as an Internet serviceprovider.) If only a few of the 700-plus Patch sites take root and thrive in theircommunities, that won’t be enough for the enterprise to succeed; for the businessto make sense, the bulk of them have to work.Landscape of local online newsLocal and “hyperlocal” news sites vary both in their coverage footprint and in theiraffiliation with traditional print or broadcast outlets. Many of the success stories inonline journalism appear in the bottom left quadrant: small, grass-roots ventureswithout corporate backing or ties to established newsrooms.online / offlineTBDJournal-Registersingle local siteLoudoun Extraincreasing scaleAlaska DispatchBaristanetBatavianincreasing legacy assetsMain Street ConnectPatchEveryBlocknational site networkonline onlySOURCE: Authors’ analysisThese distinctions suggest two axes for plotting the local news ventures workingonline, depicted in the chart shown here. The vertical axis distinguishes online-onlyoutlets from those that also have traditional print or broadcast assets.The horizontal axis arrays organizations according to their editorial footprint:single-site, hyperlocal outlets covering a community or neighborhood; sites orsmall site networks covering a cluster of communities; and site networks with aregional or national scale.44
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