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Summary:

AOL has agreed to acquire Outside.in, a hyper-local news aggregator, for substantially less than investors put into the company. Like many other experiments in hyper-local news, it failed to connect with the communities it was supposed to be serving, and that is the kiss of death.

Birdhouses
photo: See-ming Lee

According to multiple news reports this morning, AOL has agreed to acquire hyper-local news aggregator Outside.in for a sum reported to be less than $10 million, substantially below the $14.4 million the company has raised from venture funds and other sources. After four years of trying, the service has more or less failed to become much more than a local aggregator, pulling in automated feeds of news, blogs and keyword searches based on location. And that’s because it was all data and no community — in other words, all brains and no heart.

There is a business in doing this, but not a very big one, and that’s because simply aggregating data isn’t going to produce enough traffic or engagement to get advertisers interested. As Marshall Kirkpatrick notes, the field is littered with hyper-local experiments that have not really succeeded. Why? I think it’s because many of these, including Outside.in, focus too much on the how of hyper-local — the automated feeds and the aggregation of news sources, which sites like Everyblock (which was bought by MSNBC in 2009) and Topix do with algorithms — rather than the why. And the why is simple: to serve a community. Unless a site can do that, it will fail.

So how do you do that? The most successful community news operations — like a startup called Sacramento Press, which continues to grow rapidly despite the presence of a traditional newspaper competitor in the McClatchy paper The Sacramento Bee, or a Danish newspaper project called JydskeVestkysten, which has thousands of community-based correspondents who submit content for a series of hyper-local sites — come from the communities that they serve. They aren’t data aggregators that are imposed on those towns and regions by some external source, but come from within them.

The easiest way to see whether a hyper-local site is working or not is to look at the comments. Are there heated discussions going on in the comments on stories? If not, then the site is likely to be a ghost town. History is filled with local news experiments like Backfence — which was founded by former Washington Post staffer Mark Potts and shut down in 2007 — and Dan Gillmor’s Bayosphere, which never really managed to connect with the communities they were supposed to be serving, despite all the best intentions (among the newer startups trying to take a community-first approach is OpenFile, a kind of pro-am local journalism startup based in Toronto).

In the comments at Read/Write Web, the founder of Everyblock, programmer and entrepreneur Adrian Holovaty, said that his service is trying to add more community to its sites by focusing on comments and discussion around the issues — and that’s a good thing, because without it, there is nothing but a collection of automated data, and no one is going to form a strong relationship with that. Some have argued in the wake of local site TBD’s closure in Washington that hyper-local simply doesn’t scale as a business, something journalism professor Jay Rosen also wondered about in a recent comment on Twitter. But it certainly doesn’t scale if the community never buys into the idea.

Topix, which says it is one of the largest local news services on the web, started out doing the news aggregation thing just like Outside.in and Everyblock, co-founder Chris Tolles said recently in an interview with me, and then almost accidentally started to become a community hub for lots of small towns and regions that didn’t have anywhere else to talk about the issues. Topix has focused on expanding those kinds of discussions, by targeting local hubs with features such as election-based polls during the recent mid-term elections, in order to spark more debate and engagement.

This is the central challenge for AOL and its Patch.com effort, which has already spent over $50 million launching hyper-local news operations in almost a thousand cities across the United States. The sites are designed to be one-man or one-woman units, with a local journalist (in many cases, one that came from a traditional media outlet) as the core of the operation, writing local news but also pulling in other local content from blogs, government sources and elsewhere. And most of the sites appear to highlight the comments from readers prominently, which is a smart move.

But can this massive, manufacturing-style effort from a web behemoth manage to connect with enough towns on a grassroots level and really become a core part of those communities? Because without that, AOL is pouring money into a bottomless pit.

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Post and thumbnail photos courtesy of Flickr users See Ming-Lee and George Kelly

  1. No, a McDonald’s-esque operation can’t and won’t succeed, for exactly the reason you cite, and BLESS YOU for citing it … we have evangelized it for a couple years now, as one of the success stories in community-born, community-collaborative online-only neighborhood news. The only REAL scale in “hyperlocal” is springing up from the grass roots, not spray-on mass-quantity grass seed like P*tch. The Outside*in acquisition/merger/whatever is to me just a beacon shining on those sites’ inescapable fate, a monoculture sprawl of aggregation once the parent company realizes top-down/templatized does not work. No offense to the many fine newspeople who are toiling for P*tches right now … I hope more will consider going into business for themselves, starting their own community-news operations, with more freedom, more ability to truly serve the community, if that’s what they really want to do. You don’t need bloated traditional-media infrastructure to try to prop you up. And you don’t want national ads and national partnerships to infest your local site like weeds. Of the community, for the community, with the community.

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    1. Thanks for the comment, Tracy — West Seattle Blog is a great example of a community site that really seems to get the community aspect of local news.

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  2. I am all in favor of a good local news outlet. I saw you mention Topix in your story, however, and I cringed. That company is awful. Their lack of moderation and refusal to require users to register has turned a once good idea into an awful site where the attacks on people are like none I have ever seen and that is not good business. It destroys communities not builds them and manages to run off many people while inviting more cowards to come in and post trash. Hopefully another company will provide a good forum for discussion without taking the low road that the Topix company has.

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  3. Matthew, Thanks for this article. I started an Australian hyper local more than 2 years ago called StreetCorner. We now have 5 sites in Sydney. From our experience localism is about giving local issues a platform and helping people to get action on the issues that matter to them. It isn’t about ‘passive news’, it’s about making things happen. The stories that get the most comments are always the ones that people want action on, be that a development or environmental problem. We now have a lot of Mayor’s, State Politicians and Councillors publishing on our sites and this has also been powerful.

    Today the majority of our news is created by the community themselves, not Streetcorner though we do still publish local news. We do not aggregate from other sources because have never really seen the value in that nor the demand from the community.

    Direct dialogue with local decision makers brings benefits for all, including for the politicans who are prepared to engage. We have more to do to make our sites even more useful to the community and so our next version of Streetcorner, due for release in 2011 will be quite different but is based on our learnings.

    We welcome all comment and feedback from others who are in this space or are interested in this space..

    Regards
    Angela

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  4. Faire de l’#hyperlocal, c’est avant tout une histoire de communauté que l’on sert >>http://t.co/LlvVXLrN

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