The newspaper industry has been–depending upon whom you ask–struggling as of late. Large papers are bleeding staff, while small papers (30k circulation and less) are going through a period of consolidation, where ownership of a particular property changes frequently. There seems to be no end in sight for the problems with the paper news business.

In the previous post, I covered the reasons why. In this post, I’m going to talk about the solution: it’s a concept called Hyperlocalism. The idea is fundamental: improve local community news distribution and you’ll sell more news media. Sounds pretty sensible to me. In fact, I’ve come to the conclusion that Hyperlocalism is axiomatic. Ie. if you’re a small local paper and you aren’t covering local, community-centric news, then what the heck are you doing? The days of gathering national news from the AP and printing it under your local masthead are long gone.

But take this idea a step further. Imagine if local news went 2.0. The newspaper business has been slow to embrace the 2.0 concepts that have made millionaires out of everyday shareholders at Yahoo and Google, and whose nifty time-saving bells-and-whistles have made takeover bids for properties like Digg and Delicious. Yet it’s these 2.0 properties that comprise the diagram for the success of the local news business.

So a newspaper editor-in-chief realizes that he must capitulate to the demands of the audience he serves, and he puts together a web site: but we all know that most newspaper web sites suck. They’re like shareware. The reason for this is that the Old Schoolers in the news business think the web site will drive subscriptions to the printed paper rather than looking at the web site as a revenue generator itself. And by revenue, I’m referring to placement of advertising, not “subscribe now to unlock this story” schemes which are bogus and non-beneficial to the news consumer.

The reason online subscription schemes don’t work is because people come to the site looking for news, free as the web itself. Don’t give it to them, and they’ll just leave. This is a 2.0 world, and whether or not news consumers actually realize it, they aren’t going to hang around long enough to fill out yet another form on yet another web site so they can read yet another innumerous copy of the same AP story that’s been flashing on Fox News all day long. In other words, you’ve got to GIVE something to the consumer (news) in order to GET the revenue that drives the news operation (advertising). Revenue by web comes by charging for a piece of your mindshare, not jacking the consumer for content. Combine this idea with the notion of hyperlocalism and any smalltown paper can drive a profitable online operation.

But how? Follow these steps, and your news operation will make money on the web:

1. Turn the newsroom into a local content-generation powerhouse. Community content. Local high school sports. Local police chase videos. Whatever works to drive localized interest. Deliver on the promise of hyperlocalism. People care more about what’s happening in their communities than they do about what’s happening in Singapore.

2. Content-manage the news delivery. This means EMPOWERING the editorial staff to post their own stories directly to the web without the intermediate step of a web site nerd to do the heavy lifting. Look, we live in the age of content empowerment. There is absolutely no reason why an editor should have to wait for the web nerd to post her story when news breaks. A great content-management solution for local news outfits is Paper 2.0, which is an offering of my company.

3. Use “2.0″ features to increase site traffic by using the community you serve. This means allowing your readers to e-mail a particular story to a friend, or even bookmark their favorite stories. Allow users to rank stories with a simple thumbs-up-thumbs-down mechanism so that popular stories will be rewarded, while less popular ones will be penalized. This gives the editorial staff a better idea as to what the news preferences of the community are.

4. Give up on Old School thinking when it comes to editorial judgment. This is a tough pill to swallow. This means opening up public comments on all stories, even obituaries. Don’t like what somebody has to say? Tough potatoes. Deal with it. This is a 2.0 world, and you serve 2.0 news consumers.

5. Teach your ad sales staff what it means to live in a community-empowered news environment. Selling ads by the inch is the death knell of the news business. Look, you make money selling ads using your content as a carrier. If you don’t get with the program, Google will own you for eternity. Remember, people come to your site for news content, not ads. Ads are incidental and not unwelcome to the consumer, as long as they’re delivered in a fashion that’s non-offensive to the news-consuming process. Don’t plaster tower ads all over your news stories! Instead, use text anchors between paragraphs or in the side bar. Deliver ads as sparingly as possible, and stay away from flashy, distracting eyesores that take away from the consumer’s purpose in visiting your site: news consumption. Don’t just mirror your print advertising on your web site. Use the medium as it was intended: web ads are different than print ads. Use RSS to feed advertising to mobile devices. LEVERAGE THE MEDIUM for Pete’s sake and don’t do what these guys did with their site. It looks like crap. Look at all those ads competing for the coveted click. Your advertisers are paying for action, not brain-numbing competition for mindshare. Those guys could charge three times more for display ads on the web site if they merely cut down on the number of simultaneous ads being displayed! Old School thinking doesn’t work in today’s news consumption arena.

6. Embrace new forms of media to empower the community. Yup–video. Deliver news by video and you create an advertising premium. Even allow your news consumers to give comments on stories in the new medium–video and voice. It’s easier to say it than to type it. Hence the success of New School outfits like Vlip. Use video and empower your readers to use video. Want to know how to enable video comments on your news site? Call me and I’ll show you.

7. Realize that everything’s eventual. Yes, the printed paper is going away. Not tomorrow, but perhaps in 15 or 20 years when all the boomers start to croak. This reminds me of that scene from Star Trek when the Federation officer says, “The Klingon Empire has roughly 15 years left of life to it.” Well, guess what, Mr. Old School Editor. YOU ARE the proverbial Klingon Empire. Invest now in online news delivery if you want to survive. Adapt to the preferences of up and coming news consumers TODAY if you want to be in business in 2017. Allow their voices to be heard. Today’s news consumer wants to be heard as much as they want to hear. This doesn’t mean hand-selecting a few editorial letters to print in the paper. It means allowing full, unabridged discourse for everybody in your community. YOU are the centerpiece of community content, the discussion forum for all things relevant to the community you serve.

8. Embrace the concept of mobility. There used to be a saying that you can take a newspaper with you wherever you go. Well, that was true. And it still is. However, you have to pick up the newspaper first. And that’s a mobility killer. If it’s not in your driveway or on your front porch at 8 AM when you leave for work, you ain’t gettin’ the news. And what if you’re out of town on a business trip? No news for you!  Today’s mobility tools solve this problem. The Nokia N95 cell phone I carry uses an RSS reader to get the headlines from my local newspaper. No more mobility problems. I get the latest, most up-to-date localized headlines on my phone no matter where I am in the world.

There you go. Still think the newspaper is a dying breed? Not quite yet. It’s just evolving. And the papers that don’t evolve, well… They’ll be usurped by the entrepreneurs who read this post and take its ideas to heart.