Bucking the Trend: A Sustainable Model for Local News
By: Michael Shapiro
Tags: Technology, Local News, News, Media, Journalism

Photo by Stephan Henning on Unsplash

Trouble in the local news industry has been smoldering for some time. The Coronavirus pandemic came along and doused it with gasoline, accelerating consolidation, cutbacks in coverage, sharp declines in advertising and in some cases, the shuttering of entire local news publications. If one takes a zoomed out view of the local news industry, the outlook looks pretty bleak. But, as the saying goes, necessity is the mother of invention.

The Coronavirus pandemic has laid bare the vulnerabilities of local news models while simultaneously demonstrating the very real need for local news. We’ve seen large local newspapers announce that they’re shifting coverage to national topics, claiming readers demand it. What’s more is, we’re seeing paywalls erected. Really, what’s actually happening is that large newspaper chains are searching for ways to reduce or eliminate the expense of covering local news while simultaneously attempting to increase revenue under the guise that paywalls will help pay for local news coverage. All of these moves create a product that isn’t quite local news and isn’t quite national news either (where there is already a lot of competition). What we’re left with is something that doesn’t really meet a market need.

It’s not like demand doesn’t exist for local news — demand has never been stronger. But, something has gone seriously wrong when you see increased demand for a product, but reduced financial viability. This is exactly what is happening with local news and has led commentators, experts and analysts to sound a death knell for advertising-supported local journalism, and instead point to subscriptions or nonprofit news as the future.

Subscriptions are working for some outlets, but I would argue that it’s certainly not a panacea. We are living in the golden age of subscriptions, and not just news subscriptions. We can subscribe to Netflix, Hulu, Spotify, maybe a national paper, Disney Plus or whatever other services exist. The competition for attention is fierce and doesn’t leave much room for local coverage, particularly in smaller coverage areas.

Nonprofit models necessarily depend on large funders who can cease funding at any time leaving news publications without a lifeline. Meanwhile they walk on eggshells while in operation, constantly looking over their shoulder in case their funding dries up.

So how can local news work and even thrive?

As I’ve said, we need to radically reimagine local news business models. We made a few key decisions that are baked into our business model that have helped us continue to grow during the pandemic.

Local Ownership and Regional Scale

Instead of functioning like a holding company or a hedge fund that puts enormous pressure on its media properties to return profits, we made the choice to structure TAPinto so that our local publishers own the sites they operate. This creates stronger relationships in the communities we cover and in turn, leads to an overall better local news product. While our owner/publishers independently own their sites, they are also a part of a larger network. The TAPinto network allows owner/publishers to obtain regional advertising sales and also collaborate on content, while keeping their own costs low.

Putting More Dollars into Reporting

Local news is the product. If what you’re producing isn’t local, it’s not going to fly. The trouble chains have run into is in large part driven by profit pressures. In traditional local news business models, resources go into real estate (office space), back office functions, technology development and maintenance and marketing. We decided early on that the only way to make this work was to create scale in every aspect of our operations. TAPinto corporate provides the support, technology and marketing assistance for our owner/publishers. This frees up a significant amount of time and resources to focus on reporting and creating sustainable revenue streams, which, in turn, results in better local news.

Quality Advertising Products

The chatter around the death of advertising-supported local news is understandable, but advertising that provides real value for advertisers is critical, even through difficult times. Local news is not only competing for advertising dollars and attention against other news properties, but also against tech platforms. Creating quality, compelling advertising and content marketing offerings helps draw and retain advertisers. To these ends, we’ve created a suite of content marketing tools for our advertisers in addition to participating in the nationally recognized Branded Content Project to develop new tools that integrate with social media..

And, as noted before, the local relationships our owner/publishers create build trust and propel collaboration.

A Model for Every Community

Meanwhile we have developed diverse franchise models that work in communities large and small, suburban, rural and urban. Many of our sites are owned and operated by two people, one dedicated to content and one to sales. Others are owned and operated solo shops. We also have an investor model where someone buys the franchise and brings on sales and content staff to run it.

Excitingly, we have several already existing nonprofit organizations that own and operate local news sites. Here they do not depend on funding to operate the news site; rather the news site becomes an additional revenue stream, a marketing avenue for the nonprofit and helps fulfill the nonprofit’s mission giving back to the community.

Several hardcopy newspapers have franchised from us to be their online site, providing them with additional revenue streams and state of the art technology at little cost.

We also have a University model where St. Bonaventure University’s journalism program franchised as a journalism practicum for their students.

We are living through one of the most profound challenges in living memory and it’s upending almost every industry, including local news. I firmly believe, however, that if we continue to innovate, local news will come out on the other side stronger than ever.