We got an invitation to speak to the founder of the Sacramento Press a couple of weeks ago, and since few hyper-local publishers have the desire or financial means to do any PR these days, we were curious to hear what Ben Ilfeld (right) had to say.

Ilfeld is a 29-year-old entrepreneur who has created a different approach to community journalism. He has no journalism background, and that’s probably a virtue, because Sacramento Press is unencumbered by preconceptions about how publishing should be done. It is also experimenting with a diversified business model in which advertising is only a piece of the revenue picture. That’s an idea we’ve been advocating for some time.

Anybody can contribute to Sacramento Press and about 1,200 people have. About 65% of the content is generated by the community and managed by a full-time editorial staff of five people. The underlying principle, though, is what is sometimes called a “Folksonomy.” In other words, the community organizes the site.

Ilfeld and co-founder Geoff Samek created Sacramento Press’ content management system from scratch in Java. It incorporates a new navigation concept called a “story line.” Everyone who registers is asked to create one.

A story line links together all the work an author has done on a particular topic, providing a sort of background narrative. The site also relies heavily upon tags to give members the means to self-organize its content. “You can create a tag like ‘Marshall School Park’ and apply that tag to any other content,” Ilfeld said. “We then give you a URL and that creates your own front page.” The site also employs a traditional section taxonomy and its default front pages are laid out by human editors.

Merit Rewards

Members are urged along through a system of merit badges that rewards them for accomplishments like covering the fire department beat or participating in one of the many free workshops the company offers on topics like “writing for readers” and “interviewing techniques.” Basically, the more you contribute, the more recognition you get. This rewards system is a staple of user-generated content sites like Yelp and Kaboodle.

Sacramento Press’ greatest innovation, however, may be its business model. The company created a local vertical advertising network called the Sacramento Local Online Advertising Network (SLOAN) that gives advertisers and independent online publishers a chance to participate in national and regional ad campaigns. SLOAN takes care of negotiating deals and each publisher shares in the revenue. The network now represents over 50 sites and brings in over $10,000 a month.

But it goes beyond advertising. “The number one thing we do as an organization is provide marketing services,” Ilfeld says. “If building a Flickr account will help a client’s business, we’ll do that for them.” Advertising now comprises less than 50% of revenue. “Most of our sales are coming from social media work, events and services,” he says.

Sacramento Press isn’t profitable yet, but that doesn’t worry its founder. “Every time we approach profitability, we reinvest in the business,” Ilfeld says. With 90,000 unique monthly visitors and a 10% to 15% monthly growth rate, Sacramento Press is quickly becoming a significant force in the local media scene. Its ad network is also raising a barrier to entry for others.

Sacramento Press is demonstrating that a hyperlocal news model can work if publishers discard assumptions and think of new ways to generate revenue. Local media organizations are ideally positioned to provide marketing services to small businesses that lack the resources to manage their own campaigns. By diversifying their businesses, publishers can insulate themselves from disasters like the current collapse in advertising rates and position themselves as essential partners to local businesses.

We find ourselves, once again, completely in Jeff Jarvis’ camp on the issue of tearing down the advertising/editorial wall. Jarvis makes his case here in response a thoughtful but retro post by the Guardian’s Roy Greenslade. The ad/edit wall that has existed in newspapers for the last three generations is a luxury that media institutions can no longer afford and also an insult to the journalists within them. Are reporters children who are so incapable of safeguarding their own integrity that they need to be shielded from the business? Are advertisers such a corrupting force that they must be prohibited from any contact with the people who create the product they support with their ad dollars?

Jarvis notes that nearly everyone who’s starting a media operation these days has to wear both editorial and sales hats. And guess what? Many of them still manage to deliver fine products. In fact, we’d argue that the informal standards that top bloggers apply to their work are at least as good as the written standards put forth by various news organizations. That’s because integrity is one of the few assets media people have, and they know that bartering it away undermines their future. Readers are also smart enough to figure out when they’re being taken for a ride.

We’d go one step further and suggest that one reason that the American public has been blindsided by affairs like the sub-prime mortgage crisis and the S&L meltdown is that the quality of business journalism in this country is so terrible. At most newspapers, the business desk is either Siberia or a necessary labor one must complete on the track to a glamor job in the State House. How can a company like Enron build a financial house of cards that ultimately collapses and throws 20,000 people out of work without someone at the Houston Chronicle noticing if something was fishy (BTW, did you know Enron had a code of ethics?)

Probably because newspaper reporters have traditionally been told that business is evil, ad-buyers are a corrupting influence and you’re best off staying as far away as possible. That’s not really an option any more, and maybe the new breed of online publishers will prove that journalists don’t have to be treated like 10-year-olds in order to do their jobs effectively.

Miscellany

Pulitzer Prize-winning editorialist Leonard Pitts, Jr. has kicked off quite a ruckus at the Miami Herald over his skewering of citizen journalism.  His target is James O’Keefe III, the political activist whose hidden-camera wizardry is credited with bringing down the Association of Community Organizations for Reform Now (ACORN). It turns out O’Keefe’s videos exhibited questionable editing practices that caused prosecutors to decline to file charges. What’s more, O’Keefe has been in a raft of trouble since then. “It is a mark of the low regard in which journalism is held that that load of bull pucky ever passed as wisdom,” Pitts writes. “If some woman flashed a toy badge, would you call her a citizen police officer? Would you trust your health to a citizen doctor just because he produced a syringe?” No, but the contexts there are somewhat different. We agree that the O’Keefe case is an example of citizen journalism gone wrong, but we think trashing the whole concept over a few bad examples is no more responsible than dismissing traditional journalism because of Jayson Blair. About 80 commenters weigh with their views.

Let’s keep this death watch thing in perspective. World Association of Newspapers and News Publishers CEO Christoph Riess told the World Editor’s Forum in Hamburg last week, “Whatever form the newspaper takes, it will remain the dominant media force in the world.” He cited the 61% growth in print newspaper circulation in 185 countries over the last year as evidence, and noted that print newspapers “reach more audience than the Internet.”Riess is right that newspaper circulation is growing dramatically in many developing countries. However, whether that trend holds up for long is questionable. As these economies mature, it’s likely that more-prosperous citizens will leap directly to online outlets and bypass the 15-year learning curve that the U.S. went through.

Which may not be such a bad thing. Scarborough Research reports that the 9 million people who use e-readers are also avid news consumers. “E-Reader households are 11% more likely to read a newspaper regularly than an average adult,” writes Editor & Publisher. What’s more, e-reader households are nearly 50% more likely than average consumers to visit a newspaper website. You can find the press release here.

And Finally…

From The Onion:

Citing a desire to gain influence in Washington, the American people confirmed Friday that they have hired high-powered D.C. lobbyist Jack Weldon of the firm Patton Boggs to help advance their agenda in Congress.

Known among Beltway insiders for his ability to sway public policy on behalf of massive corporations such as Johnson & Johnson, Monsanto, and AT&T, Weldon, 53, is expected to use his vast network of political connections to give his new client a voice in the legislative process.

Read more…