In a growing number of spots, local news isn’t just surviving: it’s thriving. But the picture isn’t so pretty for legacy publishers. Esther Kezia Thorpe rounds up the last 12 months in local news as part of our Media Moments 2023 report.

What is notable from the many success stories of 2023 is that there is a wide diversity of models which are working in different areas. “The global decline of local news is one of journalism’s greatest challenges,” Axios’ Nicholas Johnston said. “It’s not going to be solved by a single idea, but by many entrepreneurial visions.”

Johnston was talking about his investment in local journalism newsletter network The Mill, which is beginning its expansion across the UK after being valued at £1.75 million. Founder Joshi Herrmann started the Manchester Mill as a Substack publication in 2020, before launching editions in Liverpool and Sheffield. The three titles have attracted more than 5,500 paid subscribers between them, and now have at least two reporters each on staff. With the fresh investment, The Mill’s fourth title, The Birmingham Dispatch, launched on 1st November with former Birmingham Mail Local Democracy Reporter Kate Knowles as editor.

Herrmann told Press Gazette that 2023 had brought Mill Media its strongest-ever month in September. The Sheffield Tribune is currently breaking even, the Liverpool Post is “well on its way” and flagship title the Manchester Mill is “healthily profitable.” Proving that the Mill isn’t just a one off and taking the blueprint for a successful news title elsewhere will no doubt inspire others to do the same.

Jacqui Merrington provided a neat round-up of some other ones to watch in her own newsletter The Happy Journalist, where she argued for more collaboration between local news giants and start-ups. The Edinburgh Minute from Michael McLeod publishes a daily 60-second long read on what’s going on in the city, and is sustainable through paying subscribers. The Bristol Cable “pioneered an investigative local media co-op in 2014” and at the time of writing, was wrapping up a new membership drive with the aim of being entirely member funded. 

Even the legacy local news publishers aren’t immune from the newsletter craze. A number of regional titles at Reach, the UK’s largest commercial news publisher, have adopted ‘newsletter-led’ strategies that have seen websites take a back seat. A trial at the end of last year saw five titles delivering against their newsletter page view targets. 

Paywalls are having their ‘local news moment’ in the UK, where free local news from the BBC and the relatively small market sizes have meant local titles have struggled for reader revenue. Highland News and Media in Scotland launched a digital paywall in September 2021 after participating in an FT Strategies workshop, and now has over 3,000 paid online subscribers, which equates to around 13% of their total print readers, Publishing Director Steve Barron told Press Gazette.  

Similarly, The Belfast Telegraph in Northern Ireland has 8,500 paid digital subscribers since launching its own digital paywall in May 2020. While its ‘more neutral’ stance on political reporting has helped gain readers, Director of Publishing Edward McCann also credited a conscious decision to invest in its journalism as key to its success.

Advance Local, a local news subsidiary of the media holding company Advance, have been experimenting with day passes as a way to build a paying relationship with those unwilling to commit to subscriptions. “Of the 1,826 day pass purchases, 12.3% have subscribed,” Advance Local’s Debbie Tolman wrote in the INMA Ideas Blog. “Interestingly, 2% of day pass purchasers are repeat buyers. This indicates a portion of the audience rejects the commitment of a subscription. They are willing to pay a premium price to avoid commitment.”

Even TV screens are finding an audience for local news. NBCUniversal has spent the past two years launching 15 new 24/7 local news channels on nine streaming platforms including Roku, Peacock, TCL and Xumo. They chose to stream partly to reach a younger audience, but ended up finding a more diverse audience across all demographics.

It may be a cliche to say, but diamonds are formed under pressure. Despite a pretty bleak decade or two, nearly 300 new digital local news organisations have launched since 2016 in the US alone. “Publishers operate in a challenging financial environment, but the field is making progress,” noted a study from Project Oasis. “ One in five publishers believe their organisation has reached sustainability and another two in five say they are heading in that direction.” The models and methods may vary, and there are no easy answers. But enough people are giving it a go for the sector to have found a new energy in the past few years.

Bumps (and craters) in the road

However, nowhere have the harsh realities of the business been highlighted so starkly this year as Reach. In January, they announced plans to make 200 redundancies because of the “double whammy” of decreasing consumer spend and rising costs. This ultimately only resulted in 80 job cuts. But in a bid to make at least £30 million of savings this year, they made further “significant changes” to editorial operations in March, with a further 192 editorial jobs on the line.

But that wasn’t the end of the Reach cuts. In early November, they announced a further round of 450 jobs; 320 of them editorial roles. The National Union of Journalists called the cuts “the single worst” mass culling in the UK publishing sector for decades. According to The Guardian, one staff member said the last round of redundancies had shattered their mental health, while others said readers’ experience of ads online was damaging traffic.

Bosses have blamed the “online attention recession” and “economic headwinds”. While the market has its challenges, the state of the UX at Reach – and indeed many other legacy local news publications in the UK – renders them both unreadable and unnavigable. The cuts seen this year are brutal, but an unfortunately predictable part of the decline we see when traffic and page views are the north star for a local news organisation.

National World also came under fire over summer. They announced a restructuring that placed over 50 journalists at risk of redundancy, as well as a below-inflation 4.5% pay rise, while paying £1.36 million to shareholders. 300 journalists took part in National World’s first company-wide strike in August.

In the US, Gannett, one of the countries’ biggest local publishers, has been cutting “substantially deeper” than the rate of newspaper revenue decline this year. This is partly due to debt payments on a high-interest loan it had taken out to get the Gannett-Gatehouse merger done in 2019. 

“You can also see the shrinkage in the number of newspapers Gannett publishes,” Nieman Lab’s Joshua Benton pointed out. “In 2019, post-merger, it owned 261 daily and 302 weekly newspapers. By the end of 2022, those totals were 217 daily and 175 weekly newspapers. Some of that decline is Gannett selling a few newspapers to local buyers, but a lot of it is straight-up closures. Last spring, Gannett shuttered 24 weekly newspapers here in the Boston area alone.”

Every one of Gannett’s largest local newspapers saw a circulation decline of at least 52% between 2018 and 2022. There are plenty of explanations, “but it’s hard not to believe that Gannett’s gutting of their editorial products hasn’t been a driving factor,” Benton concluded.

Struggles with legacy publishers are nothing new. But 2023 has seen some of the most promising initiatives stumble. Axios Local, which saw rapid growth in 2022, slowed their planned expansion after launching in their 30th new market in San Diego in July. The decision came after it fell 10% short of its 2022 revenue goals. Instead, Axios Local would focus on growing its existing readership and monetisation capabilities before launching anything further, according to AdWeek’s Mark Stenberg.

Sports news site The Athletic, under new owners The New York Times, has been quietly cutting back on its local podcast shows over the year. This seems to be more of a format issue as the publisher has stressed that reporters with cancelled podcasts will continue writing in-depth local coverage. But The Athletic has had to pull back from dedicated coverage of many pro teams, with management clear that continued coverage (and jobs) is dependent on reader interest.

Perhaps most difficult for some smaller outlets has been the growing hostility between Meta and publishers. The Meta Journalism Project’s team were laid off at the end of 2022, and the tech giant confirmed in September that it would stop funding the Community News Project when the current contracts end. The project currently places more than 100 reporters in under-served communities around the UK. 

Getting to grips with AI

There is barely an area of publishing AI isn’t touching, and local news is no exception. Some local news organisations have been using AI and automation successfully for some years, from publishing traffic reports to local football scores. We covered five publishers using these technologies in a special report and podcast published earlier this year: Practical AI for Local Media.

But the effect of generative AI on the sector remains to be seen. In theory, local news is one of the areas of publishing which should be more resilient to the threats it poses. A report from Enders Analysis argues that (good) local news has provenance and personality, and it will be difficult – if not impossible – for AI-generated content to take its place.

News Corp Australia is producing 3,000 articles a week using generative AI, according to Executive Chair Michael Miller. A team of four staff on the Data Local unit use the tech to generate the stories on weather, fuel prices and traffic conditions. But Miller was keen to stress that “all such information and decisions are overseen by working journalists from the Data Local team.”

In July, OpenAI, the parent company of ChatGPT, reached a two-year deal with the American Journalism Project to put $5 million towards efforts by local outlets to experiment with AI technology. In addition to the grant funding, Axios reports that there are up to $5 million worth of credits that can be used by AJP’s portfolio companies to access its tech products.

Given that tech investment is one of the biggest areas local news organisations struggle with, it will be initiatives like these which will help publishers identify and implement AI in their newsrooms in the years to come.

Sustainability in local news is certainly achievable. But even the brightest start-ups have shown that audiences are small, content needs to be highly focused, and margins are thin. “It’s a notoriously shitty business,” Scott Brodbeck, Founder of Local News Now told Press Gazette. “I probably would be a lot wealthier if I just owned a series of Airbnbs or something.”

This piece originally appeared in Media Moments 2023; our annual report exploring the key events which have shaped the media and publishing industry this year. For more including case studies and podcasts, download it for free here

Download Media Moments 2023

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *