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On the Media: Trying to Patch into the hyper-local news market

The AOL franchise comes to Manhattan Beach. Can it succeed?

April 24, 2010|By James Rainey, Los Angeles Times

Andrew Kersey has never been so excited. Andrew Kersey has never been so busy. Andrew Kersey has never been so tired.

If the journalism school graduate is a little more rumpled and pale than most young men in Manhattan Beach, you'll have to forgive him. It's not easy trying to reinvent local journalism.

"Some days I have darker bags than others," Kersey said with a chuckle, rubbing his eyes this week. "They are long days. I have never worked so hard in my life."

For the last two months, the 35-year-old editor of Manhattanbeach.patch.com has been almost single-handedly trying to establish the first toehold in Southern California of Patch.com, the local news franchise AOL hopes to plant all over America.

The job would be hard enough if Kersey only had to face the regular challenges of any starting journalist — building sources and writing with authority, for starters. But he's also got to hire freelancers, edit copy, take pictures, record video, Tweet out news flashes and build a profile for what remains an almost unknown brand.

There's always too much to do. And it will only pay off if the one area of the operation Kersey can't control, advertising, can make inroads like no other operator has been able to in the much-hyped hyper-local news space.

The rapid spread of smart phones, combined with the retreat of many newspapers, has reinvigorated the drive to open news sites to serve local communities. Big players like AOL and MSNBC (with EveryBlock, which relies on government databases and self-submitted stories) are among those angling for what is viewed as a largely untapped gold mine in local advertising.

It's hard to see how even a regional or national quilt of Patches — there are currently 47 in five states, including operations in Redondo Beach, Hermosa Beach and Calabasas, with more being added all the time — will succeed where many other local news start-ups have failed.

The incremental revenue from each view of an online display ad remains remarkably small. Patch.com asks for $15 for every 1,000 viewers it brings to one form of online ad that businesses create themselves. So if every one of 40,000 households in the South Bay's three beach cities clicked on a page with that ad, Patch would earn $600.

Whether that's an overly pessimistic or too rosy a scenario remains to be seen, as does Patch's ability to stitch together such small increments, through bigger traffic, more advertisers and, especially, selling ads across its multiple sites.

A survey by City University of New York's Graduate School of Journalism holds out hope that money can and will be made in local Internet news. The research found some hyper-local journalists around the nation making a living off their sites.

Jeff Jarvis, the CUNY professor and ubiquitous new media consultant who oversaw the research, said one hyper-local news model showed potential revenue of $350,000 a year, enough to hire three editorial employees and more than one person to sell ads.

"You can see a credible, sustainable model for local news," Jarvis said.

Jarvis says my back-of-envelope calculation for Patch in the South Bay may be overly parsimonious because many ads eventually can be placed on a single page. And a single user can click on many pages in a day.

But at least one South Bay old-schooler doesn't see how the new kid can succeed. "I don't think it will work," said Kevin Cody, who has spent four decades at the Easy Reader, the print weekly that serves the three beach cities. "I don't see financially how Patch will be able to do it."

The editor and publisher sees not only the paltry online ad rates (compared with $1,000 a page in the Easy Reader) but the still substantial competition — with at least two weeklies and the Daily Breeze still covering the area. "I understand they picked the demographics," said Cody, 61. "But why not pick a place that is underserved?"

A key for Patch and others trying to make money in the local journalism field will be building networks to sell advertising beyond city boundaries. Patch wants to construct its network on its own, which Jarvis (who serves as an advisor to the company) called "too much old-media controlling."

Others believe that the local journalism ecosystem will be dominated by local entrepreneurs who band together to share stories, pictures and to sell ads. Companies like GrowthSpur hope to help local journalists with the business and advertising ends of the operation.

Still, it's hard not to admire the kind of initiative and hard work that propels people like Kersey. He grew up in Orange County, went to UC Berkeley and drifted into writing and music criticism before getting a master's in journalism from Columbia University.

Not able to afford to live in Manhattan Beach, he rents in neighboring El Segundo and tows his laptop and digital cameras to his "virtual" offices, otherwise known as his car, City Hall, the library and an array of coffeehouses.

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