Author: Maurice Banerjee Palmer
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.
See https://www.gazette-news.co.uk/ as an example.
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
Other models are trying to fill the gap
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.
Peckham Peculiar: Just a tumblr site with a PDF. Need crowdfunding since advertising from local businesses has been ‘a bumpy ride’. Source: Peckham Peculiar crowdfunding campaign.
El Mundo Latino ad-heavy but print + PDF https://www.facebook.com/MundoLatinoNewsUK/
Glaven Valley Newsletter: Older, audience in coastal Norfolk. But in financial trouble Recently ran an appeal that asked for donations via cheque or bank transfer. https://glavenvalleynewsletter.weebly.com/
New Cross Gate Newsletter https://www.nxgtrust.org.uk/
Digitisation: Can be slow
The Manchester Mill is digitally native.
Many local publications are slow to adopt digital solutions:
‘[S]uccessfully navigating and engaging with the online advertising market, setting up a subscription service, or devising other forms of business model innovation requires a level of technical and financial resource that smaller local news publishers can often lack.’ Source: House of Commons Committee report on Sustainability of Local Journalism, January 2023
Four key opportunities
|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?
|Distribution: Reach audiences through social media and the publication’s own digital channel||
|Monetisation: Sustainable, diverse revenue base that is large enough to meet costs.||
|Costs: Run editorial and administration with lower staff costs.||
|Content: Produce content that is compelling for their local population.||
Pocket links I’ve saved over the years: