Recent research from Pew Internet & American Life Project shows that one out of five US adults now tracks local issues online. As a result, several major media companies, including AOL, are starting to enter the local and hyper-local news market to lure more local online ad dollars.

First there’s Gannett, who recently announced that it would be adding hyper-local blogs in 10 of their 19 television markets. Pacific Northwest-based Fisher Communications is also launching a new hyper-local project, which will rely on a mix of user-generated and professional content to service neighborhood-style news blogs in several of their markets.

At BIA Kelsey’s Digital Strategies for Broadcasting conference, Colleen Brown, president and CEO of Fisher Communications, gave a keynote describing the project. “As an organization, we need to be able to sell everything from a $60,000 television spot to a $35 directory listing. It’s okay to roll up nickels. They’re adding up,” Brown said. “If a website brings in $2,000 per month, that’s not a lot in our business, but if you multiply times 150 sites and 12 months, that’s over $3 million.”

This push for hyper-local online content from major news organizations is no surprise. Much of the country’s floundering daily newspapers and broadcast organizations—except, perhaps, Fisher, which is a regional broadcast organization—have yet to develop or invest in a successful online news strategy. Even big media companies like the Washington Post, whose 2007 venture into the hyper-local market started and ended prematurely, have yet to truly crack the market.

Still, the local market is attractive for big and small media alike. Local advertisers continue to move their money to the Web, and online news will certainly be a prominent recipient of those dollars. By 2014, one-quarter of all local ad spending will go online, according to BIA Kelsey. Note that “local” in this context does not just mean mom-and-pop operations. It also refers to things like advertising from University football programs or graduate degrees, or regional advertising for national retailers, or local auto dealers which are part of manufacturers’ network.

Traditional media advertising, meanwhile, will remain relatively stagnant, growing just 1% this year. BIA Kelsey estimates local online advertising spending will grow 15.1% in 2010, reaching $17.5 billion. By 2014, the research firm expects local online ad spending will reach 36.7 billion.

Enter AOL, who will try to sidestep sinking local organizations by ordering an army of journalists to create and collect content for its own hyper-local sites, along with the many neighborhood-centric news sites it chooses to partner with. The company recently announced that it will be dedicating $10 million to the creation of hundreds of local news sites in areas with populations of 50,000 or less.

Just so we’re clear: We’re talking about a major (hyper) local strategy from a well-established Web company (AOL) determined to provide quality online content to targeted, niche audiences that are increasingly reading their local news online. We’re also talking about local advertisers that are increasingly putting their money online. Those are fairly powerful forces coming together. Do the local dailies even have a chance? Maybe.  AOL’s army of journalists, in reality, is made up of mostly part-time writers, and the content may not be nearly as compelling as promised. It might fail. Or it might not.

While China continues to grab headlines in the US for its censorship policies, major espionage operations (NYTimes), and subsequent battle with Google, an interesting undercurrent is emerging from the news: There are several signs that suggest the next big online story about China is going to be Facebook.

Here’s why.

The social networking market in China is huge, with firms estimating between 43% (InSites Consulting) and 49% (comScore, Inc) of Internet users in China actively using or visiting a social network. That’s an estimated 245 million social networking site users, according to a January 2010 report by the Data Center of China Internet (DCCI), a 33.9% increase over 2008.

After a July 2009 incident in Xinjiang, the government in China placed several social networks, including Facebook, on a block list in order to control the spread of news. Reports from Inside Facebook show that only 14,000 active users in China logged on in October 2009, down from 1 million prior to being placed on the block list. Facebook remains on that block list to this day.

There are two factors that lead me to believe a push into China is in the cards for Facebook. First, Sina.com (via BusinessWeek) recently reported that an unidentified source asserted Facebook would re-emerge onto the Chinese market by the end of 2010.

Second, Reuters has reported that one of the largest Internet companies in China, Tencent, invested $300 million in a Russian tech investor, Digital Sky Technologies (DST). Last year, DST purchased a 3.5% stake in Facebook for the nearly same amount. DST operates the second-most popular Russian social network, Odnoklassniki.ru, and e-mail service Mail.ru. At the time, Silicon Alley Insider hypothesized that Facebook was undertaking international expansion by actively seeking out local partners abroad.

Tencent’s value-added services, including the popular instant messaging platform (QQ), produced revenues of $1.4 billion, and online advertising brought in $140.9 million in 2009. Facebook could be positioning itself as a partner for Tencent’s less popular social network, Qzone, to compete with leading sites 51.com, Baidu Space, Kaixin001.com and Xiaonei.com (RenRen).

There are definitely more dots that need to be connected (remember that access to Facebook.com is still blocked in China, for the most part). That said, with Tencent in its corner, it’s certainly worth keeping an eye on.

Score another one for paid content. Just after The New York Times confirmed what we’d all suspected (is “feared” too strong a word?) — that it’s going to charge for online access again — YouTube became the second media giant in a week to announce a shift from free access to paid content. The user-generated video specialist is launching an experimental digital movie-rental service, and its first venture into transactionable content. But will it work?

(Read more…)

During the course of last week we weighed in on several trends to watch in 2010. Here’s a quick and tidy round-up of those predictions.

• Seven Predictions for 2010 from eMarketer’s CEO, Geoff Ramsey: During 2010, as US ad budgets crack open just a little, look for an accelerated migration of ad dollars from traditional to digital media. Advertising on social networks will never attract a large share of marketers’ ad dollars, while the classic interruption/disruption model of advertising, whereby marketers insert unwanted, usually irrelevant ads as a price the consumer must pay to view desired content, will erode, if not fade away.



• Social Media: Marketers will demand better ways to manage and measure the impact of earned media—the additional unpaid exposure a brand gets when consumers share about the brand online. Search will get more social in several ways: by including real-time content in results (e.g., Twitter posts), adding information from social network friends to results, and using collective information from other Web users to hone search relevance. These trends will yield new ad formats that may incorporate friends’ viewpoints or interactions directly into the ad—and will raise new red flags among privacy advocates. (Read more…)