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Big 12 conference

November 2nd, 2008 by chapmanlogic

The state of independent local online news, part 5: Outsourcing as a path to profitability?

by david westphal: [editor's note: this is day five of ojr's a week-long look at the circumstances of independent local online report start-ups. each day's research will include a mug article, as vigorous as a q & a with at one or more of the day's sources. if you missed the first three installments, here they are: part 1: sites on the rise; business models remain elusivepart 2: meet with makes minnpost a top online new startuppart 3: no paper? no problem! news companies use the web to enter new marketscontribute to 4: seeking consistency from grassroots reporting]

James Macpherson learned a lesson last year when kicked up a journalism fuss over plans to outsource reporting on his Pasadena website to journalists in India.

“Never get talked out of your instincts,” he told me in a phone interview. When he forgot that adage, he said, “I got in the hole really fast.”

Macpherson, who’s run the news website “Pasadena Now” for the last four years, was so shaken by the criticism he received over his outsourcing plan that he immediately hired four reporters in what he said was an attempt to prove his journalism bona fides.

Macpherson said he almost immediately began losing money. “We did a great job. But it cost $5,000 a week There was no way I could pay for it.”

So Macpherson got rid of the reporters and went back to his outsourcing plan, which he says is working. (He told an anecdote of how his workers in India delivered him a transcript of a 20-minute press conference at CityHall, about 90 minutes after the event. The cost? $1.70 or $1.80, he said.)

About five reporters in India contribute to the site, mainly by watching webcasts or listening to audio of government meetings and then writing stories.

Macpherson’s for-profit site, rich in community events, arts and culture, is now basically a two-person operation, with lots of help from citizen volunteers though he doesn’t believe in citizen journalism per se.

Macpherson figures there’s a great future ahead for Pasadena Now. He’s experimenting with Pasadena Hoy, a Spanish language site he can get translation done for 59 cents per 100 words. And he figures he can make some money on Internet advertising, though not directly.

“My approach is not to sell online advertising,” he said. “It’s to sell the Internet to our clients. We’ll help them develop e-commerce at their own sites. I don’t think newspapers can be in the business of just selling online business on their sites. That’s not a proposition that will keep anyone alive.”

Q & A

Interview with James Macpherson, who runs the Pasadena Now Website in Pasadena, Calif.

Q. What’s become of your outsourcing experiment?

A. I’ve reverted to, refined, and expanded upon people who do not live in Pasadena to create content. At one time I had 4 full-time reporters and, in my opinion, we were doing a great job. But it was financially unsustainable. I did that because I was stung by the criticism about outsourcing.

Q. Can you be more specific?

A. Technology today permits a reporter to virtually experience an event, regardless of where the reporter is located geographically. This reporter can experience an event in real time, and can therefore report with great authority what’s happening. I’m developing long-distance techniques for reporters who aren’t physically present.

I primarily work with Indians. Many of them can produce very well-written AP style stories. Many of them have gone to American universities. The person I’m working with the most now spent 12 years in New York. With Skype and high-speed and new Web applications, they’ve enabled me to do amazing things. There was a press conference Monday. I get transcriptions produced very cheaply. About 90 minutes later I had a transcript of the 20-minute press conference. I think it cost me $1.70 or $1.80.

We’re now experimenting with Pasadena Hoy, a Spanish language site. Translation costs me 59 cents per 100 words. I can afford that. And the community needs it.

Zack and miri cast

Q. What do you consider the heart and soul of Pasadena Now?

A. The heartbeat of what we do has turned out to be coverage of community events events that people sometimes might consider hokey. Award dinners, benefits, that kind of thing. These are events that typically don’t get covered. We have a huge events calendar, which is the second part of what we do. And we are working slowly to returning to a provider of hard news. That’s a money-losing proposition right now, but we’ll get back to it.

Q. How will you do that?

A. We’re going to do it with the community’s help, through establishing a Twitter force and salting the community with more observers and neighborhood associations. I don’t mean citizen journalism. What we a …

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