With the closure of Backfence, people are beginning to doubt the viability of hyperlocal sites as anything beyond a hobby for a few dedicated people.

That hasn’t stopped mega-dailies from getting into the market. The Chicago Tribune launched TribLocal earlier this year, and The Washington Post will be launching LoudounExtra this month. LoudounExtra is a much more in-depth hyperlocal site, and it will take a heftier investment from the Pot.

It’s a bigger risk, but it may prove a bigger reward. Or it just might be a much bigger failure.

But why has hyper local been such a mystery?

Paul Farhi sheds some light on the subject in the American Journalism Review this month:

In fact, many operators don’t really have a business model. The first wave of hyperlocal sites has featured seat-of-the-pants operations, staffed part-time by dedicated volunteers, community activists and impassioned gadflies. About half of the 141 respondents to the J-Lab survey said they didn’t need to earn revenue to stay afloat, thanks to self-funding and volunteer labor. A full 80 percent said their sites either weren’t covering their operating costs–or that they just weren’t sure. Only 10 of the 141 said they were breaking even or earning a profit.

For many hyperlocal sites, the idea was never to become rich and famous. Many of the sites were launched because of a dearth of quality local coverage by existing media outlets. With newspaper cuts in recent years, the first thing to go is local coverage, and that coverage is usually replaced by wire stories.

Hyperlocal sites often try to do something radically different from traditional media outlets. They want to connect with readers and get them involved. It’s a much more organic, two-way stream of communication. These sites often judge success by how much they change traditional media outlets and how big of an impact they have on their communities.

Many hyperlocal sites often operate like bloggers on steroids combined with limited social networking features. Most bloggers (myself included) don’t blog to make money. Perhaps, judging the success of hyperlocal sites (at least in the beginning) can’t be done by monetary means alone.

For a hyperlocal site to ever be successful, it needs a dedicated audience, and it needs to have impact. That means time.

Backfence was barely up for two years before it completely shut down operations. Is that enough time to really have a major impact and build up a critical mass of a dedicated audience? Probably not.

That’s why getting into hyperlocal just to make money probably won’t work for a years or so. Hyperlocal sites often have to compete against weekly newspapers that are an established brand. People connect with that.

Is two years really enough time to compete with papers that may have been around for more than 100 years? Probably not.

That’s why if I was planning a hyperlocal journalism site (which I may or may not be) I wouldn’t expect overnight success. And I might even think about forming a partnership with a local newspaper chain or two.

Those local newspapers often provide good coverage, but have terrible online operations. Almost none of them make money online. So, you could take their established content and combine it with robust social networking features (I have yet to see anyone do anything beyond basic social networking).

Imagine combining an established brand that connects with readers with cutting edge technology to allow for readers to invest themselves in the news?

If was building a social networking site I’d also make sure the technology was there. Technology is what makes a site hyperlocal. Look at facebook, it’s a technology site. It doesn’t provide any content to its users, and yet it has monster revenue.

Why? Because it gives its users incredible tools.

Backfence never did that. Triblocal doesn’t. Will LoudounExtra?

And isn’t facebook a kind of hyperlocal network? Every college, university, town, city, etc in the country has its own network. Colleges have groups for individual organizations.

Wouldn’t it make sense for a hyperlocal site to allow users to form groups like facebook? Every church youth group, football team, PTA, tee ball league, etc could have their own group on a hyperlocal site where they can share ideas, post photos, have a calendar of events, etc. That’s hyperlocal.

It’s cool to have a calendar of events for a whole town. It’s cooler to allow individual groups in a town to have their own calendar of events.

Hyperlocal is so much beyond just having a Web site for a town. It’s about having a Web site for every person in that town.

Every person on my hyperlocal site would have a profile, a blog, would be able to send messages, join as many groups as they needed to, upload photos, etc. And then everything would be taggable and searchable.

Oh, would it ever be searchable.

I also wouldn’t build a hyperlocal site unless it had a big enough geographic area and population to tap into. Baristanet gets 60,000 unique visitors a month, and that’s considered one of the hyperlocal success stories. I’d like at least that in a day, or I wouldn’t be trying to build a site that requires millions in start-up capital.

It can be done. My high school has a little more than 1,000 students at it. Its Web site (which was named the best k-12 site in the country while I was there) received more than 32,000 unique visitors a day in the 2005-2006 school year.

A DAY!

It had one month where it averaged more than 40,000! How is that possible? Because the content is so good (and there is so much) that countless alumni and parents come to the site every day.

If we have a school dance, every students’ picture appears on the Web site the next day. At least hundreds of photos appear from every dance. Every football game has hundreds of shots online after the game or the next day.

If you build it, they will come.

It took years of quality content to get to that point. When I was co-Web master in 2001-2002, the site averaged about 3,000 visitors. That’s why giving yourself two years to succeed like Backfence did is foolish.

If some high school with around 1,000 students in a school district with around 15,000 people can get 30,000+ a day in traffic, surely a hyperlocal network for a few counties in the U.S. can do much better.

I wouldn’t build a hyperlocal site unless I was willing to build in incredible technology. I would build a site that was the first and last site my users visited each day because it had all the information people in that community needed. We haven’t seen a hyperloca site like that.

I’d combine that incredible technology and citizen reporting with real journalism. You need all three.

If someone combines all three of those prongs, they will have a site that not only means something to their communities, but also will make money.

This entry was posted on Monday, July 9th, 2007 at 3:17 pm and is filed under Mainstream Media, State of journalism, new media journalism. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.