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Saturday, August 17, 2013

AOL slashes Patch nationwide; NH sites seem mostly OK

When it comes to building a business by providing local news, pixels aren’t proving to be any easier than print.

Hundreds of people, including at least one New Hampshire editor, were laid off Friday from Patch, AOL’s network of community websites. The 4-year-old firm is closing or consolidating hundreds of websites to stem tens of millions of dollars in losses. ...

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When it comes to building a business by providing local news, pixels aren’t proving to be any easier than print.

Hundreds of people, including at least one New Hampshire editor, were laid off Friday from Patch, AOL’s network of community websites. The 4-year-old firm is closing or consolidating hundreds of websites to stem tens of millions of dollars in losses.

Although the company made no official announcement, it appears that Robert Michaelson, who edited Patch sites in Milford and Amherst, is gone. The future of those two sites is unclear.

AOL has said it will close or consolidate 150 of its community websites nationwide and sell off an equal number, concentrating on about 500 sites that have the most traffic or advertising income.

Editors of Patch sites in Greater Nashua – in Nashua, Merrimack, Bedford and Windham – appear to be unaffected.

The operation had been contracting somewhat in New Hampshire, going from 11 local journalists covering 10 sites to eight handling 12 sites, with some regional sales help. The sites also use unpaid bloggers and lists.

The local news business is no stranger to layoffs these days, as the Internet upends long-established business models. Newsrooms have shrunk at newspapers, including The Telegraph, while local radio news has all but disappeared and local TV news appears stagnant, at best.

Patch is the highest-profile attempt to create a big Internet business by stitching together lots of small-scale reporting. None have succeeded.

Over the last decade, national attempts with names such as EveryBlock and Backfence, as well as regional versions overseen by the Washington Post, Allbritton Communications and billionaire George Soros, have all closed.

The problem is that few people want to pay subscriptions online. Even worse, advertising sales, which have paid most of the cost of print and broadcast journalism for a century, have proved elusive on the Internet.

While a few companies have made fortunes through online ads, notably Google and Craigslist, none are news organizations.

Internet-only news organizations that have survived from advertising either repackage what has been reported elsewhere, keeping costs low by spending almost nothing on reporters or photographers – Huffington Post and Gawker are the best-known examples – or redefine the whole idea of journalism, acting largely as conduits for information from lots of readers, such as Reddit.

Patch, launched in 2007 and bought by AOL in 2009, tried to buck this trend. It hired hundreds of journalists in communities throughout the country, paying them a good wage with full benefits. Patch started opening sites in New Hampshire in 2011, anticipating advertising revenue related to the presidential primary.

It bet that having editors in towns would let them connect with local advertisers and that being part of AOL’s nationwide network would connect with big advertisers.

The result has been a welcome expansion of local journalism, but income has never come close to covering the cost of all those people.

According to news reports, Patch has lost hundreds of millions of dollars and remains far from breaking even – hence, the layoffs.

David Brooks can be reached at 594-6531 or dbrooks@nashua
telegraph.com. Also, follow Brooks on Twitter (@GraniteGeek).