A Digital Revolution Is Coming for Local News

By Ish Harshawat, Co-Founder of Haystack TV, an app for news

A digital revolution is coming fast for broadcast TV, changing the way a new generation of viewers are connecting with local news. And it couldn’t happen at a better time, as traditional local news audiences are shrinking and aging, and broadcasters are struggling in a world of technology to determine the best path forward.   

Local news is still the number one choice Americans turn to get their information. But news consumers today are not the same, as years past. Today’s viewer is active, more selective and wants to be informed on a variety of topics without investing too much time. And despite the popularity of the internet, a Pew Research Report released last December found that for news consumers, people still prefer watching video as their preferred way to get the news: 46%, prefer to watch, rather than read it (35%) or listen to it (17%).  This is good news for local news broadcasters –  it means, the behavior hasn’t changed, but the technologies have, and that is redefining the viewing experience.

For local news broadcasters, this also highlights a growing problem. Major resources have been invested in building local news websites, mobile apps, and promoting social media pages filled with content. But those tools, while essential in a competitive marketplace, only offer viewers an opportunity to snack and dip in and out of stories. They don’t offer news consumers the ability to have the same “lean back”  video viewing experience that research indicates they want.

The result is a slowing local broadcast market. Even though television remains the most popular way for Americans to get news,  local TV news is still seeing audiences decline, according to Pew.

The solution though, may be closer than anyone believes. All it takes is a look at the entertainment industry, and embracing the same model that has catapulted Netflix, Hulu, Fire Tv to soaring heights. Entertainment, thanks to technology leaders like Netflix, has been transformed by the internet and over-the-top (OTT) video platforms.

For local news directors, Netflix or a similar OTT service is now more of a competitor for the evening news audience than any other local or cable station. The number of people embracing OTT is staggering.

Netflix alone boasts 139 million subscribers globally. And, it expects to add another 8.9 million subscribers in the quarter that ends in March. Its success is prompting TV competitors to adapt. And it comes as Americans are increasingly cord-cutting – Pew Research found almost a quarter of American adults do not have cable or satellite TV, with about two-thirds of those non-subscribers, citing OTT content from services such as Netflix, Amazon, and Hulu as the reason.

For local news, OTT is a new frontier with a mass of opportunity. Local broadcasters have been searching for a way to recapture a declining audience base, and reach a new generation of viewers.  OTT offers that solution, introducing a new generation of viewer to local news. The majority of people who watch traditional broadcast and cable news are ages 65 and older, according to Poynter. The median age of a news viewer for OTT news platform, like  Haystack TV is 39, and its two largest groups are millennials and gen-xers. This presents a major growth opportunity for local stations, additional sources of revenue and a new consumer with disposable income.

And it’s not just the new generation of viewer that makes OTT an appealing option for local news. OTT generates a revenue stream for digital, that has for years have evaded local television stations.  According to Pew Research only 6% of a local news station’s revenue is a result of digital. Research shows local broadcasters struggle with traditional digital offerings like mobile apps and web pages which have lower CPMs. OTT creates a revenue stream that commands 5 to 10 times the CPM rate that text does.

For local news, OTT is an opportunity broadcasters cannot afford to look away from. It delivers valuable local content, exactly the way consumers want. Instant gratification any time, any way a viewer wants to watch local news. And, it’s customized to prioritize news based on a user’s exact location, as well as allowing a viewer to personalize the content for stories they find compelling. The result is a growing partnership a viewer will turn to time and again. And for the local news broadcaster, it’s also delivering key data to help guide editorial decisions.

The Cynsiders column is a platform for industry leaders to reach out to colleagues, followers, and the public at large. In their own words and in targeted Q&As, columnists address breaking news, issues of the day, and the larger changes going on in the ever-evolving world of television, video and digital. Cynsiders columns live on Cynopsis’ main page and are promoted across all daily newsletters. We welcome readers’ comments, queries, and column ideas at Lynn@Cynopsis.com.

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