CBS Local has launched an auto shopping guide on the Web site of WCCO-TV Minneapolis, using vertical content and services from High Gear Media, a Palo Alto, California-based auto specialist publisher launched two years ago by Daily Shopper founder Hesky Kutscher.

The CBS Local deal marks the first local effort for High Gear, which has 90 vertical auto-related car sites of its own. It also has distribution on site such as NASCAR.com, Yahoo Autos and Huffington Post. Its own vertical sites include TheCarConnection.com, MotorAuthority.com, GreenCarReports.com, AllCarsElectric.com and FamilyCarGuide.com.

VP of Product Management Jeff Birkeland tells us the CBS Local site will launch with 1.2 million pages of “very curated” content including content from a six-person full-time staff and freelance auto writers, as well as 200 community sources. He believes the level of specific, high-level auto writing is much higher from general content creators such as Associated Content and Demand Media.

Local radio and television stations are in various stages of extending the broadcasting business model from traditional over-the-air to an array of digital platforms. This allows both new inventory with different attributes to be sold and a critical revenue growth path. How these digital incentives by broadcasting firms get resourced, managed, executed and evaluated is going to become an increasingly important part of the economic profile of the industry. Broadcasters need to know what’s working or not and why. They need to understand the opportunities and the threats in the digital media ecosystem. And broadcasters need to make commitments to the digital space in a meaningful but responsible way that ties back to corporate missions and the need to generate revenue growth.

These are the ingredients behind our new advisory service, “Digital Strategies for Broadcasting.” Technology can drive new workflows, partnerships and revenue streams, and in doing so challenge existing management and operational structures and processes. Running a broadcast company with digital media assets is quite different from running a traditional broadcast property.

BIA itself has taken the “digital plunge” with its acquisition of The Kelsey Group, which extended our expertise, knowledge and relationship base into digital media. With the launch of DSB we are leveraging those resources along with the expertise, data and services BIA has provided the broadcast industry with since 1983.

The explicit goal of DSB is to help our advisory clients develop and execute their digital strategies as successfully as possible. This may mean broadcasters but it can also mean assisting those firms elsewhere in the local media ecosystem looking to understand and work more productively with broadcasters as partners, service providers or vendors.

For more information about Digital Strategies for Broadcasting, click here.

Click to register for our free webinar on Tuesday, March 16, Digital Strategies for Broadcasting: Capitalizing on the Shift to Local and Digital Media.

DataSphere, a hyperlocal enabler and sales agent for local media companies, says that Northwest TV and radio giant Fisher Communications has now sold more than 1,000 hyperlocal advertisers using Datasphere’s neighborhood-specific content and sales system. The system is now in more than 43 neighborhoods served by Fisher TV stations in Seattle, 40 neighborhoods in Portland and additional neighborhoods in Boise. Each advertiser pays between $30 and $400 per month depending on the tier of services chosen.

DataSphere CEO Satbir Khanuja, a former senior executive at Amazon, says “our timing is precisely right.” He notes that many advertisers had experience with Google text ads, but that the company’s focus on enhanced profile display ads makes more sense. It also brings in more money. “They’d been paying 50 cents to $1 for the text ad, but we can bring in 10 times more from the account,” he says (or $5).

In terms of getting to conversion, the company’s focus on specific neighborhoods rather than DMAs has been key to successfully selling the local accounts and leveraging content from the local media partner and from local bloggers, who benefit from aggregating their audience. “They want to see ‘my neighborhood.’ Things that are really in their community,” says Khanuja.

In New Castle (WA), for instance, the whole town was talking about Blockbuster and the imminent closing of its local store, he says. The company got that. “It is also important that they’re calling from [Fisher's] KOMO-TV News” rather than from a no-name provider, he says. “Our conversion is extremely high.”

Key categories for DataSphere in Seattle and other markets that it serves include groceries, drug chains, dentists and lawyers. “The categories are controlled by the [local] sales agents,” says Khanuja. “It is all green field.”

DataSphere has also launched in markets served by other media partners, such Providence, R.I. It supports more than 130 hyperlocal neighborhoods in all, including 40 in the Monterey,CA/Salinas areas in partnership with Cowles California and its area TV stations.

Fisher has invested $1.5 million in the company, an amount that was part of a $10.8 million B round. Ignition Partners was another investor. Khanuja says the hefty amount will be used to develop the software platform and launch “thousands” of additional neighborhoods. Fisher recently owned and then divested Pegasus News, another hyperlocal platform.

Zvents, the events lister, is reporting 35 percent year over year growth with over eight million unique visitors, largely due to its powering events for 285 local media brands, including  major newspapers and the NBC owned-and-operated TV stations.

CEO Ethan Stock cites Quantcast data showing Zvents Media Network as the 250^th most used net on the Web, ahead of Citysearch (#267) and Local.com (#291). “We’re a very large local property by any measure,” he says.

The company, which has raised $32 million over its five year history, also claims it has been averaging 12,000 monthly event listers. These use the site to promote a wide range of local events and activities, including live music, performing arts, sporting events and community activities.

Of those listers, roughly 1200, or 10 percent, are now boosting their presence by taking out ads via self–serve – a percentage that Stock thinks will climb to 20 percent in 2010. The company also sells regional and national accounts via telemarketing and national sales, with top categories including major concert promoters, sports teams, casinos and  home and garden events.

High end shopping, with its sales-oriented events, such as Williams Sonoma cooking demonstrations, are also becoming more important to Zvents bottom line.  “There is a significant segment of consumers who perceive shopping as entertainment,” says Stock.

The key to the company’s future in local, however, is to stay away from the trap of focusing on directory-type advertising. Instead, Zvents will stay focused on events and shopping, he says, which have the most highly motivated advertisers. “They are also relatively concentrated in terms of the volume of advertising.”

Indeed, the company’s focus on events and advertising puts it most in competition with social sites such as Facebook and Google, rather than local sites such as Citysearch and Yelp, who may be more directory oriented, says Stock. Other events oriented companies include Eventful, and “new city guide” players such as Center’d and American Towns.

In hindsight, the company’s initial focus on teaming with newspapers “look like a very smart choice,” adds Stock. While newspapers are commonly disparaged in today’s climate for their declining circulation and advertising, “they have high repeat traffic. Much more than national partners.” Top Zvents newspaper partners include SFGate, the Denver Post, Seattle PI, Boston.com, the Dallas Morning News, the Atlanta Journal Constitution, New York Daily News, and the Orange County Register.

Stock also sees a major boost coming from renewed efforts in local from national partners such as AT&T’s Yellowpages.com, which has been an investor in the company ; and from MSN, where Zvents listings will be showing up in Bing, and trigger Instant Answers via Silverlight search.

By Steve Passwaiter and Rick Ducey

For broadcasters, it is an article of faith that “localism” is a point of differentiation that adds value to their operations. Localism tends to mean local news, sports, weather, traffic, local events, coverage of local government, and other promotional and volunteer involvement in the community. There’s a lot of chatter about what it takes to succeed with true “localism.” This past year has seen some notable localism failures. Other efforts are in a nascent stage.

One case in point is Allbritton Communications, based in the Washington, D.C.-area. Its television stations are affiliated with ABC, with the largest property being WJLA-TV, the ABC affiliate in the Washington, D.C., market.

Our primary interest was the fall 2009 announcement of Allbritton’s plans to launch a Washington, D.C.-focused news site that will combine with the WJLA and NewsChannel 8 television and Web operations. To launch this new local news site, Allbritton hired Jim Brady, the former executive editor of Washingtonpost.com. The site is set to launch in spring 2010 and will have about 50 more news staffers on hand.

We recently talked with Allbritton’s senior vice president of legal and strategic affairs, Jerry Fritz, who supports Robert Allbritton (the family-owned company’s chairman and visionary) and Fred Ryan. These three executives are the key architects of this strategy. Fritz has a long history with the company that spans more than 20 years.

While the timing seems very fortuitous, Fritz tells us it’s really the culmination of a plan that was devised back in the late 1980s, when Allbritton (who used to own The Washington Star) saw an opportunity to build a strong local franchise to compete with the news-gathering prowess of The Washington Post.

The first effort under the plan was the launch of NewsChannel 8 distributed over local cable systems. NewsChannel 8 was, at first, a separate operation from the local broadcast television station. A truly, locally focused news operation, NewsChannel 8 broke down its news for the area’s three separate and distinct geographies with a mix of local, lifestyle and political programs. It was a pioneer and in its early days it was a tough sell for audiences and advertisers. Its programming and appeal have grown as the product has matured and its mix of local news and lifestyle shows (political talk to local golf) now attract larger audiences plus a mix of larger and smaller advertisers. NewsChannel 8 also has benefited from the growth in the news product on WJLA. WJLA has completely rebuilt its local news operations following a downsizing many years ago.

From its base in local television, Allbritton leveraged its core assets across media platforms to exploit some of the unique attributes of the D.C. market.

That included developing an online newspaper to address the market opportunity of providing news, commentary and an advertising vehicle to government contractors, lobbyists, trade associations and others seeking to influence the nation’s seat of government.

Politico.com, designed to be the ESPN of politics, was Allbritton’s initial online effort under the new strategy. While Politico was designed around the Web, readers and advertisers clamored for a print counterpart. Allbritton responded with a three-times-a-week print product that was quickly ramped to five days.

Since then, Politico has created a national network of newspapers and Web sites that share Politico stories in exchange for Web ad avails, which Politico sells to national advertisers. It is a classic win-win.

In fact, Politico’s timing has been perfect. Many newspapers have closed their D.C. news bureaus, and local newspapers are struggling to fill the news gap. Recent filings with the SEC have detailed just how successful the operation of Politico has become in a relatively short time as revenues have topped the $20m mark and cash flows have reached seven figures.

Now, both WJLA-TV and NewsChannel 8 share facilities and some staff members as they gather, collect and present local news and information to the D.C. market. Adding Politico, the Allbritton operation finds itself as one of the country’s leaders in the gathering and dissemination of political news. That has positive rub-off effects on both WJLA and NewsChannel 8. Washington is still very much a company town.

So, it’s in the same vein that we look at this soon to be launched local news oriented Web site. Adding 50 journalists to an operation that already includes a prominent local television station and its cable news spinoff plus the acclaimed Politico gives Allbritton’s operation one of the largest news gathering operations in the market. As the company focuses on enabling its journalists to file news across any platform, it’s easy to see the combined Allbritton portfolio giving some heartache to The Washington Post (and few know that property better than Jim Brady). The company just recently brought a senior sales executive to lead the advertising sales effort for the new metro new site.

Allbritton already has a deal in place with the market’s leading news/talk radio station as well to share content and to provide weather reporting from its team of meteorologists. While it doesn’t seem that Allbritton wants to get itself embedded into the longer view stories that The Post covers, it does seem that there’s a probable audience for hurried Washington audience members who want to get the news in an easy, connected and time saving way.

The Allbritton mission is to produce and serve unique content which has appeal beyond the Washington market. The plan is to capitalize not only on local ad spend across broadcast, cable, print and online platforms but also to get access to content syndication and barter ad inventory nationwide. Allbritton understands that it can be profitable to serve not only local audiences and advertisers well with smart execution but that this entire operation can be leveraged to grow out of market revenues. Could this example serve as a possible model for other broadcasters looking for a digital strategy that actually makes money?

Digital media is more cannibalistic than complementary and is seriously eating into the demand for traditional news sources such as newspapers, TV and news magazines, according to the third annual survey of news users done by Outsell Inc.

The survey findings are based on almost 3,000 consumers and are fully detailed in Outsell’s “News Users 2009” report, written by former Knight Ridder executive Ken Doctor. It essentially pours water on hopes that online traffic from Google and other news aggregators represents new growth opportunities for traditional publishers that ultimately outweigh any cannibalism. In fact, 44 percent said news headlines on aggregator products such as Google News suffice in themselves.

Indeed, such aggregator products are increasingly competing with traditional news products as primary “morning” news sources. They’re tied with newspapers and catching up with TV, which leads with a 30 percent share, a drop-off from 36 percent three years ago.

Long-term trends may be worse than the broad numbers suggest, as a segmentation analysis by Outsell found that “Power Users,” who represent slightly less than half of the market, are increasingly relying more on digital products. These users have “omnivorous” appetites for news, simultaneously serving as core newspaper subscribers while relying more heavily on news aggregator products.

Outsell, however, found they are spending less time with print publications. Moreover, they are increasingly inclined to drop their newspaper subscriptions.

“It’s worth watching the trends set by power news users — they tend to foreshadow where all news usage is moving,” notes Outsell. “The daily newspaper and news magazine habit is quickly ebbing.”

The survey also suggests that paid content may not be a panacea — something that The New York Times is betting on, as it implements plans to move to paid online models in early 2011.  Analysts (like me) would argue that The Times exists in a class of its own as a news source and may prove the exception. Another industry hope –shared by Apple, Amazon, HP and others — is that large computer tablets might entice people to pay for a la carte or subscription content.

Without thinking about the exceptionalism of The Times, or the future of tablets, 75 percent of news users told Outsell that they would get their local news from a different source if a pay wall was put up. Only a small minority said they would be willing to pay for some type of paid content (i.e., online access included with print subscription, online-only access or some other type of “press pass.”).

When the time comes, however, many users will surely reconsider. Just look at the evolution of pay per call, and more recently, paid iPhone apps. None of this, however, undermines the challenges that traditional media face with/and against Google and other digital sources.

At The Kelsey Group, we’ve come to appreciate that our new owner, BIAfn head Tom Buono, is a major strategist. While Buono’s roots are in the finance of traditional TV, radio and newspapers, he’s mostly thinking about their next steps in the Internet era — and the next steps for local media in general.

In an interview with TVNewsday Editor Harry Jessell, Buono notes that BIAfn’s perspective is that it is all part of a “media ecosystem.” “When you introduce some kind of disruptive force, the whole ecosystem changes,” he says. “We’ve seen this happen over the history of media. Now we’ve got the Internet entering and the Internet just dramatically changes the media ecosystem in terms of relationships, in terms of accountability, in terms of transparency, how quickly you can see ROI information, the cost-per-point differential and actually shifting from cost per point to cost for leads or actual performance in terms of purchases.

“Unfortunately for print media — newspaper, yellow pages, magazines — they’re very vulnerable to what’s going on,” Buono observes. “Longtime heritage newspapers are going out of business because their business model can’t adapt to this new environment.”

TV stations, however, are more adaptable. “Television is much better situated for survival and actually can thrive, but it needs to be redefined in terms of what the business it is in,” says Buono. To adapt, however, TV stations must redefine themselves as being community portals or content providers of local content. “TV broadcasters have to start looking at their business differently and saying. I’ve got these assets. I’ve got the ability to generate content locally,” he says. “I’ve got a sales force that can go out and reach advertisers. I’ve got a local identity already established in this marketplace. I have a brand that has value. I have got an audience that already follows what we’re doing. How do I capitalize on that?”

Sales are also critical. “The sales force needs to be trained differently. They have to be selling multiplatform. They can’t just be selling spots on a TV station. They need to be selling a whole range of services for local advertisers. It’s how can I help the local advertisers be successful, not how can I sell spots on my TV station.”

“In summary, the current economic pressure may be substantial and must be addressed,” says Buono. “But the long-term survival of existing traditional media depends on them undertaking internal and external reviews and taking new and different action to transform their business model to succeed in this changing media ecosystem.”

Earlier this week I went to hear an economist offer his take on the current economy and how soon it would recover. Long story short, I believe the speaker, who had outstanding credentials, was overly optimistic. (I really believe he may have been on vacation on some secluded island for the past year.) In fact, his views were the most positive I have heard or read in the past six months or so. However, he did say a couple of things that I agreed with. One was that television and radio have combined their news and entertainment divisions so that a prime objective of news is now to be entertaining … that is to attract viewers and listeners. Therefore, he said, the media has good reason to say the sky is falling: It brings people in.

Recently, Sharon Begley wrote a column in Newsweek titled “Why Pundits Get Things Wrong.” She quoted a study by a research psychologist at Stanford University who concluded that there was no way to predict the accuracy of anyone’s forecasts. There was no relation to whether the forecaster was a Ph.D., an economist, a political scientist or a journalist or had any other credentials, affiliations or fame. What works for the media, she wrote, are “bold, decisive assertions that make better sound bites; bombast, swagger and certainty make for better TV.”

For more than a dozen years, The Kelsey Group has been predicting the future of the industries we cover. We take the best information we have at the time, talk to industry participants, weigh their views with our own perspectives and make forecasts of the future. We do the best we can to help our clients and the businesses we serve.

The acquisition of The Kelsey Group by BIA resulted in the combination of TKG’s strength in directional media, including all things interactive, with BIA’s strong position in television, radio and newspapers. The benefit of the merger became clear yesterday when the newly formed BIA Advisory Services released a forecast that my colleague Neal Polachek described as “an expanded and more comprehensive view of the U.S. local media sector (by widening our unique understanding) of local media by adding six categories to our forecast.”

It is a little bit unnerving to be offering a new forecast in this difficult economy. Some of the headlines about our forecast said “local ad markets shrinking,” or used terms like “declining” or “downward spiral.” Unfortunately, BIA and TKG analysts do envision local advertising revenues declining from $155.3 billion in 2008 to $144.4 billion in 2013, a negative 1.4 percent CAGR. What is notable, at least to me, is that most of that decline comes from the primarily directional media of newspaper classified advertising and print Yellow Pages. The growth is all in the equally directional Internet Yellow Pages, local search and other interactive digital advertising. There’s just not much share change in traditional direct mail, television, radio, out of home, cable or magazine advertising.

As Harry A. Jessell put it so well in today’s TVNewsday, “the newfangled competition will come, but nobody is in a better position to rule the local online world than TV stations. They have the content, the business contacts and an unmatched ability to promote.” Broadcasters should know that that was the mantra of newspapers 15 years ago. Recognition is the easy part; the hard part is following through and actually making the changes that will help you to compete.

Interactive television once vied with the Internet (and dedicated online services) as the best conduit for interactive content. That fell by the wayside in the mid-1990s.

Today, ITV solutions are largely limited to simpler Internet-like apps like photo collections, Yellow Pages search, customized weather, real estate and auto search, games and electronic program guides. Almost all of it comes via cable TV and broadband video providers (like AT&T U-verse). There is very limited advertising support for these solutions.

Other interactive TV apps are still out there, however. As broadcasters consider their multi-channel futures, there’s been some pickup. This week, Atlanta-based Gray Communications, a 36-station group reaching 7 million homes, said it was launching a remote control driven “Clickable TV” service by Boston-based Backchannelmedia, which already serves 32 stations, including some Media General, Hearst-Argyle and LIN-TV outlets. The service initially launched field trials in May 2008.

Users of Clickable TV use their remotes to activate small “bugs,” or icons, located at the bottom of their TV screen. The icons indicate a “clickable moment” and send bookmarks of the content to users’ Web browsers.

The rub, of course, is it isn’t a fully interactive solution. Users need to access the content on their Web-enabled phone or PC. But it is a new channel for advertising. TV stations can sell advertising on a “per click” basis in addition to impression-based TV commercials. It also provides user data on viewer interaction. Is it more meaningful than flashing URLs? It might be.

Pegasus News, the Dallas hyperlocal site, was seen as a great model for other markets when Fisher Communications, a leading broadcaster in Seattle and the Northwest, bought the site in July 2007.

But the roiled market in broadcasting apparently stifled Fisher’s ambitions. Ultimately, there were never serious efforts made to install a Pegasus platform on any Fisher property. On Dec. 31, Fisher sold Pegasus for $1.5 million to an unnamed company that is only being described as a “broadly held private media company.”

Before the sale, longtime Seattle Times interactive executive Nancy Bruner, who had been recruited to run Fisher’s interactive efforts, also left the broadcaster (although the two incidents are not necessarily related).

Pegasus founder Mike Orren says his 18-person team sees the sale as a good thing. Initial signs for adding the Pegasus platform to various Fisher markets had been positive, he says, but “the whole world for broadcast media changed a lot” since the company’s acquisition.

Ultimately, Pegasus never provided much more than some tech support and a few ideas, he says. Lost Remote broke the story and has some more details and interesting comments.