NBC/Outside.in Launch Hyper-Local News Model

Welcome to the future. Fire up your browser, and go to this part of NBC New York's website.
Do you see that window at the left labeled "Local Hot Spots?" Please click on one of the circles. I clicked on Houston Street, and it yielded 120 blog posts and one NBC news stories.

This represents an example of what the media industry needs to do quickly in order to survive. Although it has yet to be officially announced, the partnership between the upstart, hyper-local platform Outside.in and venerable old NBC provides an early but revealing glimpse into what the next stage of our media industry could look like.

We'll get to that in a moment. But first, for some context, I spoke with Outside.in's CEO Mark Josephson yesterday about what his service -- and this high-profile deal -- are all about.

"We are creating branded applications for publishers that are location-sensitive," he told me. "We have feeds from thousands of publishers and we can provide data based on city, state, neighborhood, street address, latitude and longitude."

So far, the company has developed the ability to provide a combination of news content and user-generated content (blogs, Tweets, Yelp posts, Flickr photos, etc.) to anyone in those neighborhoods.

In addition, thanks to the company's just-launched iPhone app, mobile users can access all of this aggregated information as they move through a neighborhood. Picture it this way: You and a friend are taking a walk in, say in the lower east side of Manhattan.You've been here many times, but it's been a while, so you only vaguely recall the way to Katz's Deli, where you remember eating the biggest and best hot pastrami on rye sandwich ever. Not to mention the pickles.

Besides, it's the weekend, and you've already been through the Tenement Museum Tour over on Orchard Street plus the bookstore across the street, and your stomach is growling.

Just whip out your mobile device, enter your exact coordinates, check out the "local hot spots" and select Katz's down on Houston Street. Meanwhile, as you're making your way there, you can see and hear whatever the chatter is on the blogs in the buildings around you as you pass.

Trust me. On the lower east side, there is always a lot of chatter. Even at this early stage of implementation, this area's activity hot spot "bubbles" look to be among the largest in all of Manhattan.

"What we are doing," Josephson told me, "is extending the editorial content of our media partners down to a level they can't afford to go, but where consumers now expect news and information to be available."

This, according to theory, will allow the media company in question to sell targeted ads at the same rate they currently sell national or city-wide rates, with no additional investment on the content side. Over time, Josephson is betting, these hyper-local customers will be even more valuable to advertisers than the current advertising model, which is top-down, he says, and "has to flip."

So that means that Katz's, or any other local establishment, should find that the acquisition of new customers via hyper-local advertising is more valuable, given the lifetime value of each new customer, than any other available channel for growing their businesses.

But, somebody's asking, what about the downturn in the media business and how is that dampening this little startup's prospects? Josephson claims that the deal-flow for his little company's app is actually bigger than he can handle at the moment, and I don't think he's jiving me. I've heard this from a number of CEO's recently whose companies are offering potential technological solutions to the media industry's hugely broken business model.

"Maybe they (media execs) were in denial before, but they're not any more," is how Josephson put it to me. Outside.in, BTW, which recently booked its second round of funding from Union Square Ventures, is headquartered for now in Brooklyn.

But if Josephson has his way, the company will be moving into the Union Square neighborhood, once they hit the big time. I'm thinking, good, maybe they can help me find this bar, a cozy little place where I took a lady once, they serve great martinis -- what was it called...?

Note: Thanks to Erin Freeley and Mack MacNamara for their help on this piece.