2014 – The Year The Hyperlocal Dream Ended?

At the start of the year I confidently expected and publicly predicted that 2014 would be one of profound change in local media in the UK. In the event nothing that significant happened. Read what is written below with that health warning in mind.

Anyone that reads Private Eye or follows @mediaguido knows that there is an increasingly fraught division in newsrooms between print and digital. One side points out that they make all the money, the other points out that they have all the readers. This split is just as evident and often just as bitter in local news organisations maybe more so as the ratio of readership between print and digital has moved far further in favour of the latter in the regionals.

Anyone who thinks there is no appetite for local news should look at the growth numbers seen for the web sites of the regional press particularly in the metropolitan areas of England. Even allowing for the apples and pears nature of the comparison between someone who picks up a newspaper and someone who visits a newspaper web site, regional publishers probably had their highest ever readership in 2014 if you add print and digital audience.

The year however was a continuation of the trend of closure and lay offs concentrated in content creation because very little money is made from this explosion in readers.

The argument used by the digital faction in local news organisations is that print only makes all the money because of market distortion not because digital is fundamentally more difficult to monetise. The main way the playing field is skewed is by the requirement for statutory notices to be put in the print edition of the newspaper. I argued sometime ago that the increased willingness of the local newspaper groups to trumpet their digital success was a prelude to them adopting the idea that public notices could be put on their online editions. This view was based on conversations with people on the digital side of the industry who were arguing that profitability would increase despite the likely reduction in cost for local authorities. This is because print titles that were over dependent on an effective subsidy from the local authority would close and the costs saved would be outweighed by the revenue increase for the digital side.

The love of print remains within the DNA of the regional newspaper industry and even when Eric Pickles made a call for a ’21st century approach’ to statutory notices the response from both local authorities and regional media was deafening silence according to insiders at the DCLG. That Councils stonewalled the call is not hard to understand as Pickles made it clear that the exclusion of third party media from the process was not on the agenda. Every local authority in the country longs for the day when they don’t have to pay for putting notices in newspapers. The lack of response from the regional media groups is more complex to understand. There were some in the local newspaper industry who saw this as the last chance to set the agenda for the development of local media for the next decade. They feel that the ‘dinosaurs’ in their organisations got the upper hand on the issue and, out of fear that accepting that accepting that some notices could be published digitally was the thin end of the wedge, opted to do nothing.

What the consequences of this are going to be won’t be known until after the election. Labour’s Digital Government Review will inevitably look more favourably on the demands of the local authorities. Whilst a wholesale move to publication of notices on Council web sites is unlikely, it is inconceivable that they would pass up the opportunity to implement measures that would be popular, encourage use of technology and save money. The cost would be born by the local newspaper industry but the big metropolitan newspapers which tend to cover Labour supporting areas are less dependent on public notice revenues for survival so the closures would be in smaller towns and rural areas which tend to elect non-Labour MPs.

The decision would then need to be made as to whether retaining a small number of staff to continue publishing news digitally would be economically viable. The sales efforts of many publishers are so wedded to print that they may decide ‘no’ but given the relatively low cost of staying in the game and the ownership of an already substantial audience many will continue.

Independent hyperlocals do seem to be getting squeezed by the renewed energy in digital of the larger publishers. Numbers produced by Dave Harte of the Birmingham School of Media showed a decline in the number of hyperlocal publishers over the last year. (I was going to link to this very interesting research but his site was down at the time of writing). Even allowing for the demise of the Local People Network the underlying numbers are depressing and Mr Harte’s methodology includes any sites which have had a single update in the last five months – a very generous definition of what should be defined as active.

To add to what was a miserable year for the sector, NESTA, who were tasked with rescuing the independent hyperlocals with potfuls of public money, seem to have come to the conclusion that the existing publishers were part of the problem not the solution. This resulted in the truly perverse decision to fund to the tune of £800,000 an enterprise called TownFizz which was basically a clone of the aforementioned Local People. The daftness of this idea was made even more evident after one hyperlocal independent had to ditch fund raising plans because of the competitive threat offered by TownFizz.

The hyperlocal scene in London remains quite robust with most of the commercially sustainable sites in the country being based here. However, there haven’t really been any successful launches for the last three years. The established sites are consolidating their position but new sites are not emerging to cover areas even where a news vacuum has emerged with the demise of the local paper. As far as I can tell there have been no new sites launched in Kensington and Chelsea or Westminster as a result of the shuttering of the newspapers covering those boroughs.

The failure of the independents to fill the news gap is quite worrying as, if Labour do win the next election (or become the largest party in a coalition) and they adopt a scorched earth policy towards local media by reducing or turning off the flow of public subsidy, the expectation that the internet will step forward to fill the gap will be misplaced.

What we have seen in 2014 is confirmation, if it were needed, that the appetite for local news remains huge. This news does need to be professionally produced and the ability to do this remains concentrated in the larger regional publishers. The independent hyperlocals are being squeezed for readership by the resurgent digital efforts of ‘big’media who look set for the time-being to continue to enjoy the fruits of the public notice related subsidy.

In 2015 the most likely scenario is that a Labour led Government will in some way reduce that subsidy but the capacity of independent hyperlocals to fill the gap is in doubt. There will be fewer journalist covering local news and it may well be that 2014 comes to represent the peak of local news readership in this country.


About londonhyperlocal

Musing on the change face of local news provision in London
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