Patch and Pro-Am Media by the Numbers

AOL Patch Launches 100th Local News Site, but Is it a Boon for Journalists?

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NEW YORK (AdAge.com) -- AOL's hyper-local news division Patch launched its 100th news site today, underscoring just how quickly AOL is advancing its bid for original content through journalism. The company says it will launch 400 more such local news sites across the U.S. by year's end as well as hire 300 more journalists.

A growing swell of mass-content players are tempting content from a wide variety of freelancers, of course, with more companies sure to adopt the model in their wake. Earlier this month one of the biggest content generators, Demand Media, announced its plans for an initial public offering. Last spring Yahoo bought another one, Associated Content, for some $100 million.

But these platforms and companies aren't all the same, whether for advertisers or for freelancers.

"Patch is curated, conceived, presented and developed on a local level, all the way," said Chris Hiland, president of media networks at Geomentum, a unit of the Interpublic Group devoted to hyper-local marketing. "There's certainly a wisdom in the crowds, and the scale that Demand and Associated bring is compelling, but there's a degree of professional editorial that is resonant in the Patch model that an advertiser values. Especially an advertiser who invests in local media -- it's an easier transition from legacy local media. Patch looks and acts like a local paper."

For reporters, photographers and other potential freelancers, too, the new boom in local news does not necessarily portend a significant upside. The pie, though bigger, is now being sliced smaller.

Patch currently uses more than 1,000 freelancers in 100 cities. Each city site is staffed by a full-time editor who assigns stories to a raft of freelance writers. Though rates for stories vary, Patch freelancers typically average about $50 per article, which is higher than what Demand Media or Associated Content offer. Unlike those companies, however, the amount of available work is limited. Most of Patch's editors have a weekly freelance budget slightly north of $500, according to people familiar with the matter. Patch further differs from other content purveyors by only taking on writers with a background in journalism.

Patch's most direct competitor is Examiner, a Denver-based start-up owned by billionaire investor Philip Anschutz that's also modeled on delivering local news and content. The site currently covers more than 240 neighborhoods across the U.S. But at a rate of $1 to $7.50 for every 1,000 impressions a contributor's article generates, Examiner writers don't draw any significant remuneration. "I tell our examiners [writers] not to quit their day jobs," CEO Rick Blair told Ad Age in June.

AOL has also reached out to journalists with another one of its units, Seed, which is modeled more directly on Demand and Associated. Seed editors put out calls for content but its contributors have to write on speculation, meaning they may not get paid. Editors can assign a single article or topic to multiple writers and only one submission will be published.

The field will keep changing quickly, but here's our list of the major players in the summer of 2010, broken down by the numbers:

Demand Media
Pay Rate: $15 to $20 per article; $30 per video
Freelancer Count: 10,000
Publish Rate: 6,000 articles and videos per day
Monthly Readers: 58.6 million

Associated Content
Pay Rate: $1 to $30 per article; additional $2 per thousand impressions performance fee in some cases
Freelancer Count: 350,000
Publish Rate: 5,000 articles per day
Monthly Readers: 11.1 million

Examiner
Pay Rate: $1.00 to $7.50 for every thousand impressions
Freelancer Count: 50,000
Neighborhoods: 240
Publish Rate: 3,000 articles per day
Monthly Readers: 14.5 million

Patch
Pay Rate: $50 per article; $75 per video
Freelancer Count: 1,100 (currently also has 200 professional full-time editors, including editors for city guides that haven't launched yet)
Neighborhoods: 100
Publish Rate: 600 articles per day
Monthly Readers: 309,000

Seed
Pay Rate: $25 to $400 per article, depending on depth of research
Freelancer Count: N/A
Publish Rate: N/A
Readers: N/A (neither ComScore nor AOL could provide traffic data for Seed)

Huffington Post
Pay Rate: $0 (leaving aside, for this discussion, 53 paid editorial staffers)
Freelancer Count: 6,000
Publish Rate: 600 articles per day
Monthly Readers: 23.8 million

Source for reader data: ComScore

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