An article in The Times says the new wave of community sites is caused by local newspapers’ lack of micro-local coverage. That's true, but there's more to it.
Micro-local sites find solid footing because:
1) Newspapers create financial support for start-ups by setting ad rates too high for small business owners. Micro-sites become entry-level for advertisers. I've warned about this before.
2) Cash-strapped newspapers move too slowly to recognize emerging "long-tail" markets. Niche geographics are just another example of The Long Tail. Post the slightest, seemingly unimportant news, and it's still read by someone. Maybe a dozen someones. Point is, there are page views to be generated, and sold.
The Times article begs the question: If geographic niche sites are becoming increasingly common, then what happens to local newspapers?
Letting a geographic niche site grow under your feet is what the Innovator's Dilemma warned against. An effective low-end competitor pushes the original business to focus on the high-end market. For newspapers, that means focusing on large advertisers and rich readers. Inevitably, the formerly low-end competitor makes headway into the high-end market. And the original business slowly loses all market share. Read the book. This exact plot has unfolded many times, in many industries.
The good news for newspapers is they're willing to buy competitors.
When a newspaper awakens and sees a strong competitor in its midst, it will try to beat them or buy them. FresnoFamous.com is the perfect example of a geographic-niche site bought by a newspaper that got caught flat-footed in responding to an emerging market.
The trouble will come only if the community site refuses to sell.


Comments (6)
The trouble will come only if the community site refuses to sell.
Or the newspaper fails to realize the competition or thinks it's not enough to bother with. Or the local management isn't competent or engaged enough to make such a buy.
Posted by Bryan Murley | January 14, 2007 10:39 AM
Posted on January 14, 2007 10:39
It's unfortunate to imagine an example where a newspaper doesn't recognize a new competitor -- eventually. But I suppose it's possible that a newspaper exec might not recognize a competitor if it has no print companion.
You're right, too, there might be some newspapers unwilling or unable to buy the competitor. They will fall to the plot outlined by Innovator's Dilemma.
Posted by Lucas | January 14, 2007 2:07 PM
Posted on January 14, 2007 14:07
Hope you're right. We're one of the ones that refused to sell.
Posted by Mike Orren | January 16, 2007 12:36 PM
Posted on January 16, 2007 12:36
Just because a community site decides against selling doesn't mean "trouble"...
many citizen journalism sites are written differently than newspapers. People go to them for lots of reasons.
The same people might also be going to the newspaper's website.
We don't know. No-one's ever bothered to ask the folks who read many of the very good, and very involved, community/hyperlocal/citizen journalism sites that are out there....
and in some communities, micro or even web-sites don't work for advertisers. Out here in rural Western Mass, there's a huge debate among advertising execs re the effectiveness of online advertising in general, with many beginning to shy away from some online outlets. Further, some of they hyperlocal cit j folks I know who are rural have had a hard time with advertisers because of the lack of adequate internet access in those towns. If all one has is dial-up in a broadband world, that's not much incentive to be online.
Posted by tish grier | January 16, 2007 1:03 PM
Posted on January 16, 2007 13:03
I guess Bryan was more right than I thought. There might be some folks out there who won't recognize a competitor, even when they're covering the very same geographic territory.
Community sites are founded in response to a gap of service in the market. (Several gaps, most likely.) Readers start using an alternative media outlet to supplement the newspaper. Letting any local competitor initially serve as a supplement to your coverage opens the door for them to one day replace your coverage.
What's wrong with the newspaper industry when our first reaction to any new competitor isn't, "How do I beat them into bankruptcy?" and is instead, "Can't we all get along?"
Maybe some of you are OK with sitting back and hoping the community site never decides to cover anything "important" to your paper. (But obviously important to readers.) Maybe some are even hopeful that the community site doesn't intend to make money. (That's a funny one to me.)
I'm not one of those people.
Posted by Lucas | January 16, 2007 7:04 PM
Posted on January 16, 2007 19:04
This scenario isn't unique to the Internet; it's been played out in print for many decades as free classified sheets and alt weeklies pick off "credit risk" and "nuisance" advertisers with "low quality" products. Eventually the big daily becomes marginalized and overly dependent on a few major accounts, and when a Montgomery Ward fails or a Wal-Mart eats up the markeplace, the paper discovers it's in trouble.
It's actually a pattern that Clayton Christensen has documented in many other industries as well.
An understanding of the pattern is the first step toward being able to deal with the problem of disruptive competitors.
Posted by Steve Yelvington | January 17, 2007 7:53 PM
Posted on January 17, 2007 19:53