Last November, Gothamist — a New York City local news website — and its affiliates in other American cities shut down. Gothamist CEO Joe Ricketts, who had acquired the newspaper and its affiliated sites earlier that year, made the choice a few days after staff reporters and editors decided to unionise. Ricketts cited economic hardship as the cause of the shutdown, but people believe his true intention was to retaliate against the workers, as he had expressed disapproval of unions in the past. Evidently, Ricketts’ action was not welcomed by New Yorkers, who gathered to protest the shutdown and express their support for local journalism. However, last week, it was announced that public radios WNYC, KPCC and WAMU had bought Gothamist and two of its affiliates’ assets, which they will soon start running again.
Gothamist’s readers and fans will definitely greet the return. However, beyond this enthusiasm, we should focus on a more profound issue. Ricketts explicitly mentioned that he shut down the websites because they were no longer successful. Whether you believe him or not, we must ask ourselves if local news is still a profitable business or if we are witnessing its last years before a slow, inevitable death.
As Gothamist comes back, it is now supported by public radio stations, which ensure it is under a safer scheme. The news website will no longer rely just on local advertising for sustenance but also sponsorships, memberships and foundations affiliated with the radio stations. What about the finances of other local news outlets? Statistics show that local news organizations have been struggling. Even big newspapers such as The New York Times, Daily News and The Wall Street Journal have been forced to cut down local-level reporting. While the model of sending reporters to the ground to cover information concerning small areas worked well in the past, web traffic has changed these dynamics. This is because newspapers can now see the amount of clicks their pieces get and use that data to produce more click-worthy content.
There are two major trends here. First, journalism is becoming less profitable as it makes the transition to cater to its online audience: earnings from digital advertising do not make up for lost earnings from print advertising. Second, local online advertising — which was essential for the local news outlet’s survival — is migrating to social media because advertisers can reach a broader audience this way. One way or another, the existence of sites under Gothamist’s previous model are being threatened.
So what is there to say about the future of local news outlets? Difficult as it is to admit, things don’t look bright. As technology changes society, industries must evolve. Businesses ranging from supermarkets to airlines are constantly changing to keep up with modern times. Local news outlets cannot be the exception. Just ask Blockbuster how well that worked for them.
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Email Diego Maguina Razuri at [email protected].