Author: Maurice Banerjee Palmer

Summary

  • Traditional outlets are dying. Loss of print advertising revenue has contributed to poor quality content.

  • Other models are trying to fill the gap. They cobble together distribution and monetisation solutions but scale is limited.

  • Distribution, monetisation, cost reduction and content production are the four key opportunities for technology, and specifically AI.

Traditional local media is dying

Revenue: Squeezed by Facebook and Google

Major traditional local news has relied on advertising. Globally Facebook and Google have taken 80% ad market share, squeezing out print.

  • ‘Yet hundreds of local newspaper titles have closed in the past two decades. News publishers’ traditional print revenues have collapsed as people increasingly read news online. The smaller audiences for local news make shifting to digital business models based on online advertising or subscriptions particularly difficult.’ Source: House of Commons Committee report on Sustainability of Local Journalism, January 2023

  • Digital readers are worth one eighth of a print reader. Traditional outlets use traffic-based programmatic advertising through Google and Meta, which local media can’t win (Source: https://manchestermill.co.uk/p/i-worked-for-the-north-wests-local

  • Subscriptions are a winner-take-most market.

  • A minimal staff of six costs £250,000 PA to run. To cover this a publication would need to convert 10% of the local population.

Content: Increasingly irrelevant

Focused on neighbour complaints, crime, housing developments, swamped with ads. Not compelling for a modern audience.

Consolidation:

  • 295 (20%) of the UK’s local publications closed between 2005 and 2021. Source: Media Reform Coalition

  • After Newsquest bought Archant they now control 30% of the overall market.

  • 50% of local authorities are covered by only one outlet.

The Coronavirus pandemic has accelerated the long-term decline in both circulation and

advertising revenues in the local press industry [...] since 2005 publishers have closed as many as 295 local newspapers—shrinking the UK’s local press by a fifth. [...] The largest local publishers have [cut] costs by consolidating distinct daily and weekly print titles into regional ‘hubs’ or rebranded online-only services. The result has been a growth in the scale of news ‘deserts’ around the UK

Source: https://www.mediareform.org.uk/wp-content/uploads/2021/03/Who-Owns-the-UK-Media_final2.pdf

Other models are trying to fill the gap

Content: Higher-quality

New local media often covers a broader spectrum of topics than traditional print media.

  • The Manchester Mill aims for longer-form content. Charges £7 a month through Substack

Distribution and revenue: Struggling

But their distribution channels are either print (which is fine for some) or inconvenient platforms – for example a PDF on Tumblr.

See others:

Digitisation: Can be slow

The Manchester Mill is digitally native.

Many local publications are slow to adopt digital solutions:

Four key opportunities

Rank Opportunity Impact
1 Distribution: Reach audiences through social media and the publication’s own digital channel Digital distribution is king. If outlets can attract valuable eyeballs they can monetise them, but this doesn’t work the other way round.
2 Monetisation: Sustainable, diverse revenue base that is large enough to meet costs. An alternative to Google/Meta programmatic advertising creates space for quality content.
3 Costs: Run editorial and administration with lower staff costs. Less time spent on business administration, gathering evidence for stories, or producing content for different distribution channel enables hyperlocal outlets to survive on low revenues.
4 Content: Produce content that is compelling for their local population. Written, audio and video content that is engaging for audiences remains time-consuming relies on expertise.

Solution space: an opportunity from AI?

Opportunity Solutions
Distribution: Reach audiences through social media and the publication’s own digital channel

  • Could existing content be repurposed for distribution through WhatsApp/Twitter?

  • Could PDFs be turned into websites?

  • Could chatbots hand hold publication managers through the process of setting up digital distribution and monetisation channels?

Monetisation: Sustainable, diverse revenue base that is large enough to meet costs.

  • How can local outlets find non-advertising sources of revenue?

  • Could generative AI reduce the barrier to local businesses placing ads? What about self-serve creative, moderation and placement based on a Google Maps listing?

Costs: Run editorial and administration with lower staff costs.

  • What workflow efficiencies are available?

  • Can news stories be generated using data alone (planning, police, restaurants, sport)?

Content: Produce content that is compelling for their local population.

  • Could local data (planning, police, restaurants, sport) surface areas of interest for journalists?

  • Could generative AI produce engaging content from minimal inputs? Especially using video and images?

  • Could local outlets produce ‘match highlights’ of their local teams?

References

Pocket links I’ve saved over the years:

Discovery Jam 2023