Following a massive layoff of 400 employees in August of 2013, another massive round of layoffs has left the Patch.com network of hyperlocal news outlets with a skeleton crew.
Outside of a leaked audio where Patch.com employees were notified of their termination, little is known as to what plans the new majority owner of Patch.com plans.
AOL, which has invested upwards of half a billion dollars in the purchase and development of Patch.com, recently sold it’s majority ownership to Hale Global – a company with a reputation for turning around failing ventures.
Sources familiar with the NJ operation believe about 10 employees remain to run the near 140 Patch’s scattered throughout New Jersey and Pennsylvania.
LINKS:
http://finance.yahoo.com/news/massive-layoffs-patch-put-bullet-163400331.html
http://njnewscommons.org/patch-firings-hit-new-jersey/
Original Post August 12th, 2012
Patch.com is coming to Oakland, according to a new Facebook page established by the editor of the Wyckoff-Franklin Lakes Patch.
Local Patch.com websites are a welcome addition to many towns throughout New Jersey with close to 90 Patches being listed by the NJ Online News Resource Group.
Relying on paid journalists, freelancers, and submissions from the community, the Patch.com platform has been able to fill a gap in hyper-local news. The Oakland community should undoubtedly benefit tremendously from the establishment of an Oakland Patch.
For local residents who may want to participate with Patch, and practice some “citizen journalism”, there are numerous resources available online to help. One organization, The Citizen’s Campaign, a grassroots advocacy group for better government in NJ, offers scheduled classes on citizen journalism – as well as extensive online resources for those wishing to report on municipal affairs in their community .
The Patch model has been very successful in terms of attracting local readers, contributors, and providing an alternative source of news for smaller communities; in some smaller communities, it may be the only source of news for local residents.
But the hyper-local news network, with nearly 900 Patches nationwide, comes to Oakland in the midst of a major restructuring as the AOL subsidiary seeks to establish a sustainable business model….And that is the question being asked by Wall Street and AOL investors is : How sustainable is the business model?
AOL recently faced a revolt from a group of investors known as Starboard Value, which was very critical of AOL’s ownership of the Patch.com network. A report published in May 2012 alleges that Patch lost $147 million by only generating $13 million in ad revenue.
Tim Armstrong , CEO of AOL, and the original owner of Patch, is determined to make the network viable. How AOL will transform Patch.com into a viable business model is still a mystery, but the company has stated that the planned restructuring will include changes in strategy, marketing, and the technology platform itself.
Armstrong, commenting on the coming changes to Patch.com, offered a comparison to the services offered by Craigslist. He hopes that Patch in the future will be able to once again fill a hyper-local gap by leveraging Patch.com’s local connections as an alternative to Craigslist’s more broad geographic categories.
Another veteran in the hyper-local market, NeighborGoods.com, has recently experienced it’s own transformation in an effort to find a more sustainable business model. NeighborGoods was also designed to fill a hyper-local gap in terms of goods & services available on the local level. The original business model was built around finding “great deals” from neighbors, but the founders have decided that a hyper-local “craigslist” was not the common mentality of the hyper-local user.
NeighborGoods is now transforming into FavorTree.com which is accepting pre-registrations. The new platform removes the financial incentive, and instead implements a “Play-It-Forward” gaming system. People will be provided an opportunity to exchange favors with neighbors, or earn points when being able to provide a favor.
As Patch.com begins its own restructuring, there are hints of it seeking to create a platform with similarities to Facebook, and fill another hyper-local gap in terms of a platform designed specifically around geographic regions. Simultaneously, Facebook itself may eventually be wandering into the hyper-local news market itself as it launches FacebookStories.com.
The new FacebookStories website is focused on stories from around the globe based on a theme – the launch theme being “Remembering”. It offers a collection of personal stories loosely built around the idea of “memory”. While Facebook has not intimated as to the long-term vision of FacebookStories.com, the capability to tap into the largest database in human history and channel it for hyper-local purposes is a distinct possibility.
Details on The Oakland Patch are expected in the coming weeks, and it’s unclear if Oakland’s Patch will stand on it’s own or be merged into the Wyckoff-Franklin Lakes Patch.
The success of a hyper-local online resource is often dependent on the participation and support of the community it serves. The Journal encourages Oakland residents & readers to support the new Oakland Patch as another vehicle to showcase Oakland and build a stronger community through communication.