HispanicBusiness

Some of the largest, most influential newspapers and media companies in the country have tried it: The New York Times. The Washington Post. The Chicago Tribune. Gannett. AOL.

None has succeeded. Yet.

Their quest to reach readers and advertisers at the hyperlocal level - covering events town by town, neighborhood by neighborhood - has been beset with false starts, red ink and, most recently, an ethics scandal.

The Post, the Times and a group of six Gannett newspapers in New Jersey each abandoned their efforts to cover microcommunities.

AOL, which has invested millions of dollars in Patch.com, its network of hyperlocal websites, hasn't found a way to make a profit. Patch lost more than $100 million last year, according to some estimates, red ink that spreads throughout more than 860 communities in 23 states.

Started in 2007 with a $1.1 million grant from the John S. and James L. Knight Foundation, Chicago-based EveryBlock was running out of cash. After shopping for investors, it found a deep-pocketed owner two years later in NBCUniversal.

Then there's Tribune Co.

The Chicago Tribune's parent company, a partner in McClatchy-Tribune News Service, has egg on its face after revelations that its partner in producing hyperlocal news, a third-party content provider named Journatic LLC, had been using false bylines on some of its stories.

A follow-up investigation by the Chicago Tribune also found plagiarism and fabrication in another story, resulting in the paper earlier this month indefinitely suspending the use of Journatic editorial content.

Aside from ethical issues, questions remain about the model. While the market has identified a need for hyperlocal content, no one has figured out how to make it a successful business. That uncertainty hasn't stopped a number of players eager to join the fray, including Joe Ricketts, the billionaire whose family trust owns the Chicago Cubs.

"There's a whole class of advertiser who was shut out by (higher) newspaper rates, and readers who never got truly local news from their metro newspaper," said Jay Rosen, a journalism professor at New York University and a prominent media critic. "The problem that Journatic was trying to solve is worth solving."

The media business fascination with hyperlocal news is a reflection of the enormous cultural shifts hastened by America's migration online.

For the better part of two centuries, print newspapers owned the market for information, holding a virtual monopoly over local advertising. Then along came the Internet, which tore that business model to shreds, allowing anyone to produce a version of the hometown newspaper. All it took was an element of curiosity and access to a computer.

On the other side of newspapers' value proposition - advertising - even greater forces were working to dismantle the traditional business model. Why pay to take out a classified in a newspaper when Craigslist was free? Profits took a dive. Newspapers cut costs, tightened their focus and hemmed in coverage.

They also started to fight back. Afraid of ceding any more territory to the Web, newspapers launched initiatives of their own.

The challenges have proven nearly insurmountable. Journalism, even without the costs of a printing press and distribution, is an expensive endeavor because of the salaries for reporters and editors. The competition has grown fiercer. And because the idea is still so new, a clear picture of who wants hyperlocal news, which type and who will foot the bill has not emerged.