Baltimore is used to having out-of-town companies gobble up its home-grown news operations. The ranks of the  once- independent-and family-owned that are now media properties include The Baltimore Sun (Chicago-based Tribune Co.) and WJZ-TV (one of 28 stations owned by CBS Corp.)

But the latest deep-pocketed corporate ‘playa to muscle into the Baltimore media market, AOL, is taking a different approach. Rather than acquiring an existing entity, they’re quietly building online news operations from the ground up, in Towson and in two dozen other suburban Maryland communities. What they’re creating they call Patch.com, a national network of “hyperlocal” news sites aiming to fill the prodigious news holes created by shrinking traditional media.

In addition to TowsonPatch, there’s a Lutherville/TimoniumPatch and EllicottCityPatch, among the Maryland sites either scheduled or already publishing. Patches have also sprouted in affluent communities in New York, Massachusetts, Connecticut and New Jersey and a growing list of other states.

Patch sites have a uniform design template — whether in suburban Baltimore, Brookline, Mass. or Maplewood, N.J., they all sport the same blue-and-green color scheme and layout, and serve up the same basic mix of local sports, politics, schools and community ‘doings. There are videos of the local homecoming parade and Facebook discussions about last night’s big thunderstorm or Chamber of Commerce speech. It’s as if your hometown weekly were suddenly taken over by Starbucks.

On DarienPatch last week, prominent stories included: “Dispose of Your Old Meds Saturday at Ox Ridge” and “Rubber Stamp v. Reckless radical: 4^th District Ad Wars.”

On CatonsvillePatch there’s “Comets Run Wild over Falcons” and “At UMBC, Optimism About Jobs, Economy.”

The one local resource that Patch has been snapping up around Baltimore is writers and editors. For months Patch has been advertising locally for full-time jobs that pay annual salaries that seasoned journos would have sniffed at years ago (in the $35,000 to $40,000 range, sources say)  but in today’s terrible times for media, they’re attracting plenty of takers.

“It’s very weird. All the local ones are run by former students of mine,” said Monica Lopossay, a former Baltimore Sun staff photographer with three Pulitzer nominations who was laid off, along with nearly a third of the newsroom, in 2009.

Lopossay, who freelances and teaches photojournalism at Towson University, took a Maryland State Fair photo for Patch this year as a favor to one of those students. (“The student was, like, ‘Please, Professor, would you help me launch my site?’”)

She figures that’s the limit of her involvement with Patch (“They pay terribly, they pay horribly.”) though these days, who’s paying that much more? (Even her occasional New York Times shoots, she notes, only pay $200 and the Sun pays $125, whether the assignment takes five minutes or five hours.)

So, what is Patch: a superficial cookie-cutter McPaper (well, McWebsite) fueled by sweatshop labor? Or a paradigm-busting platform that’s going to lead us out of our journalistic crisis by putting reportorial boots back on the ground?

Tellingly, even seasoned community journalists, whose turf Patch threatens, aren’t quite sure.

Utopia? Dystopia?

Bryan Sears is the immediate past president of the Maryland Chapter of the Society of Professional Journalists, and a well-known local political reporter in the Greater Baltimore area.

At points in a discussion about Patch, Sears seemed excited by the idea that a ripple effect from the chain’s rapid expansion could actually benefit journalists in search of jobs.

“There are media companies taking this very seriously. What happens if they [Patch] ramp up and put a lot of reporters in the area, and The [Baltimore] Sun or [Washington] Post decides it needs to respond in kind?” Sears said.  “All of a sudden you’ve got yourself a 21st century newspaper war.”

At other moments, he has a reporter’s skepticism that Patch, or any company, has figured out a cure for what’s afflicting America’s Fourth Estate.

“There are two questions as I see it.  One, it’s AOL, the same company that had Bebo, the social networking site that no one ever heard of.  Have they learned from that?” Sears said.  “Two, do they have some magic ju-ju that makes these Patch sites work that the others didn’t?”

In the end, Sears said, he welcomes the arrival of the Patch sites, even though they technically compete for readers with his paper.

“I’m excited about journalists getting good jobs and enjoying the work they’re doing,” he said, “and I refuse to believe that having more reporters on the beat is anything but good for the public.”

And, he added, “I plan on beating them as often as I can.”

The Patch Effect

With newspaper circulation and ad revenue plummeting, and newspapers shrinking and disappearing, journalists are starved for some good news about their own industry.  Professional wonks like CUNY professor Jeff Jarvis and author Clay Shirky boast legions of loyal Twitterites who fall hungrily upon their every prognostication. Online start-ups are anticipated months in advance, and launched with all the restraint of a Don King press conference.  We need something to root for.

This might help to explain the aura of good vibes surrounding Patch, (whose editorial advisory board includes Jarvis.) Patch’s initial burst of start-up money is direct from AOL, with a nearly $50 million dollar investment and a grand plan to hire 500 journalists. Why not cheer for (and why offend?) a corporate behemoth throwing huge amounts of money toward creating a sustainable news-gathering operation solution? Call it the “Patch effect.”

If AOL figures out how to build that better mousetrap they will have succeeded where many have failed before. The media graveyard is littered with hyper-local experiments that have tried to capture the market – The Washington Post’s LoudounExtra.com, Backfence.com, and Microsoft’s Sidewalk.com are a few examples. Lately Politico has entered the race with its TBD.com.  It didn’t take long for media and tech critics to dump on AOL’s business model and reportage and give the site long odds.

“Patch effect” or not, is there reason to believe this time will be different?

Patching Maryland

Patch staffs appear to include both experienced reporters and youngsters not far removed from J-school or just an undergraduate degree.

“We’ve got people with a lot of experience in print, we’ve got people with experience in broadcast, we’ve got some local editors who are fairly recent grads, and others with 5-10 years of experience,” said Tim Windsor, former director of digital strategies at Johns Hopkins University and now the editorial director for Patch.com’s southern region.

Windsor was a prime pickup for the fledgling Patch operation. Before his time at JHU, Windsor was the head of interactive at The Baltimore Sun, and was part of the team that moved the paper online back in 1996.  Windsor sees Patch as a way to “carry journalism into the current century.”

According to Windsor, Patch.com splits the country into 4 regions – West, Midwest, Northeast, and South.  Locally, the Baltimore/Washington area has been divided into three sections – the first covers Harford and most of Baltimore County, the next covers western Baltimore County and all of Carroll, and the last runs south to the D.C. area.

A total of 12 local Patches report to a regional editor, who in turn reports to Windsor and the other editorial directors across the country.  Right now, Patch sites that have launched or are on the verge in the Baltimore area include: Timonium/Lutherville, Towson, Catonsville, Greater Annapolis, Bowie, Perry Hall, Bel Air, Ellicott City and Columbia.

A quick scan of Patch job offerings reveals additional sites on the horizon, including Aberdeen, Edgewood-Joppatowne, Owings Mills, Reisterstown, Upper Marlboro, Westminster, and Parkville-Overlea.

Paying the bills

In addition to news coverage, Patch sites offer a directory of all businesses in their respective areas, complete with photos and a text listing compiled by freelancers.  Advertisers can dress their entries up with features such as video — for a fee.  Businesses can offer coupons, along with newsletter and banner ads, to round out their Patch presence.

Patch markets itself through a combination of local event sponsorship, search engine optimization, easy sharing through social media, automatic distribution through the AOL.com universe, Patch directory profiles embedded in Mapquest, portals in Starbucks wi-fi, automatic distribution to AOL email address holders, and old-fashioned word-of-mouth.

How the venture will sustain itself is the subject of great speculation around town. As a regional editor, Doug Donovan says he hasn’t been let in on the secret.

“It’s the traditional Chinese wall between editorial and advertising,” said Donovan, a former Sun reporter.  “I know they have an advertising staff structured similarly to the editorial, with regional and local ad people going out in clusters, but just like in newspapers, we never interact with those folks.”

“I think they truly believe they have the ‘first mover’ advantage in the field, establishing a toehold,” said Donovan, who has also been a Brew contributor.  “They must have seen something that made them truly think that this was a good investment.”

One person who is watching closely is Ted Venetoulis, the publisher and former Baltimore County Executive who leads a local group that has been talking with Tribune about purchasing The Baltimore Sun. Venetoulis believes Patch is doomed if it is banking too heavily on AOL’s existing advertising network to keep it afloat.

“It’s a plus to have big funder, and AOL should have some large national advertisers,” Venetoulis said.  “But if the model includes less than 50 percent local advertisers, that won’t fly.”

Meanwhile, not everyone is convinced that the local advertising market is viable.

“It’s baffling to me, as it is to quite a few people, where the revenue is going to come from,” said Rick Edmonds, a media business analyst at Poynter.org, a nonprofit school and online resource center for journalists.  “There are probably parts of the business plan that they aren’t making public.”

“CPMs for online advertising are low,” Edmonds said.  CPM, or cost-per-mille, is the cost to advertisers per thousand views.  While convenient for advertisers, because it allows them to buy exposures in bulk instead of paying-per-click, CPM can be less lucrative for ad sellers.

Edmonds also pointed to a technology knowledge gap, between mom-and-pop business and web publishers.

“Local merchants don’t seem to be very quick to embrace online ads,” Edmonds said.  “Part of it is conservatism, the idea that if it’s working, they’ll stick with it.  Also, making an online ad is beyond the skills of a typical local business.”

A quick scan of all Maryland Patch sites shows most of the current advertisers to be national – Kraft Foods, and an ad for the new Pixar film, “Alpha & Omega,” by Lionsgate Family Entertainment.

Sean Carton, chief creative officer for the Baltimore web design and advertising firm idfive, has some similar concerns about whether enough small Baltimore-area businesses are ready to embrace web advertising.

He sees some other questions, as well.  Will their sales force be able to do local? “If you were a commissioned sales rep, wouldn’t it be more worth it to go after 1 big national account than have to service 100 local accounts?” he said.

A more fundamental issue is whether advertising is the best way to monetize a local site, as opposed to “search,” an argument Carton makes at greater length here. And if search is a more promising route to revenue, he notes, there is already a lot of competition out there.

“Sites like Yelp and UrbanSpoon already “own” food and (in Yelp’s case) services,” he said, in an email. “Craigslist and Freecycle and Backpage and, to some extent, eBay have replaced classified advertising.”

Overall, though, he sees Patch as having an advantage over smaller independent sites because of its ability to tap into AOL’s national advertiser pool.

“AOL’s ability to deliver high-impact display-rich-media ads to advertisers gives them a bit of a leg up,’ he said.

Plus, they have the dollars to mount a national advertising campaign for their own brand, to make themselves more familiar than homegrown media.

“It’s like the franchise model: I’d bet you see a lot more ads for Papa John’s than you do for Angelo’s,” he said. “If they’re able to build up the Patch brand so that it becomes synonymous with “Local,” then they might win.”

– Fern Shen also contributed to this story.

Next: “Maryland Patch websites: Kittens and Kale Recipes?” (Oct. 15, 2010)