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Browse NewsHour coverage of life in Cyberspace
There is a saying in political circles that "all politics is local." The same might be said of the Web. After becoming familiar with the global reach and the dizzifying array of options on the Web, many seasoned surfers are heading to local sites to check out the weather report and local movie listings. Regional sites also offer advertisers a verifiable target audience, unlike the global Web audience which is diffuse and difficult to verify.
Indeed, many major companies are banking that "local" is the Web publishing wave of the future. America Online has launched guides for Washington D.C. and Boston. AOL has joined with Tribune Co. to create "Digital City" available in up to 200 cities within two years. AT&T's Hometown Network has joined in with plans for ad-supported regional Web sites in 70 U.S. cities by the end of 1997. Computer giant Microsoft is spending over $300 million on a Web product called CityScape, due out towards the end of this year.
Not all such experiments are driven by commercial concerns. Municiple authorities in European cities such as Amsterdam, Newcastle and Antwerp have set up citywide networks that allow citizens to obtain public documents and join Internet debates with legislators on everything from minimum wage to city construction projects.
What will all these changes mean for you and me? Some envision a Web where people flock to local sites that deliver relevant information and meaningful experiences, sites that invite repeat visits like a favorite local station preprogrammed on a car radio, or the familiar local paper available at the street corner. Others stand by the original conception of the Web as a truly global environment, where people gather from all over the world united by common interests.
What do you think the future of the World Wide Web will look like? Will local usage become as popular as the global focus of the past?
Your questions will be answered by Bob Smith, Vice President and General Manager of Digital City, America Online's local affiliate program, and Rob Enderle, Electronic Communications analyst with the Giga Information Group. Please submit your questions by 1 p.m. EDT, August 2.
A question from Alex Williams of Portland, Or.:How will local pages like Digital City plan to redefine local coverage, so it is not just a copy of what is available in the newspaper or on the radio and tv?
Bob Smith of Digital Cities responds:
Hey Alex,
We at DCI want to build local online communities. We see local news and information as an element of our service, not its sole purpose. A local Digital City will highlight the content of existing local newspapers, magazines, radio and TV companies--not replace it. We will not have an editorial voice per se, but will focus our energies on enabling and encouraging the people of a local community to communicate amongst themselves and with the media partners we have assembled. It's this intercommunication that defines the new online medium.Rob Enderle of the Giga Information Group responds:
Initially their advantage is that you only see what is interesting to you as opposed to having to wade through an entire paper or sit for 30 minutes in front of the TV or Radio for individual topics. As these "agents" get more and more capable they should be able to provide the maximum amount of information in the least amount of time. Enhancements would be in the range of coverage and the accuracy and effectiveness of the lead in summaries that many already supply. Other enhancements would include links to backup information and a dynamic modification of the "agent" based on reading patterns.
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A question from Jamie Raymond of Sabetha, Kansas:
Sabetha, Kansas, where I live, is a town of about 2500 citizens. We don't have the resources that larger cities have when it comes to funding online projects. Do you think small towns and rural America in general will be left behind, since the feasibility of catering to such small constituencies seems poor?
Bob Smith of Digital Cities responds:
Hi Jamie,
I sure hope they won't be, but it is difficult to create viable local online services in these communities today. The math really works against it: 2500 citizens = 1,000 households = 120 likely online service/Internet users--that's tough to justify in a business plan. However, I strongly believe that interactive servcies should be available to even the smallest communities. I want us to create Digital City services for neighborhoods of larger cities and smaller communities nation wide. We are working with both community newspapers in larger cities and smaller market media companies to find ways to accomplish this.I also believe that as costs for building telecommunications infrastructures come down, and competition increases, that companies like AOL, phone and cable companies, will continue to expand their networks to anywhere there are reasonable pockets of potential subscribers. AOL already has a very large number of U.S. cities covered with local-call access, as well as a very inexpensive 800 dial-in service, and it continues to grow its network.
Rob Enderle of the Giga Information Group responds:
To a certain extent, much like telephone, radio and TV technology penetrated the rural areas far less quickly then the cities and suburbs, the Internet is held to a similar model initially. However as more and more positions allow the employee to live wherever they want, rural areas (and the related Bell operating company or competitor) will see a potential to attract these customers with enhanced communications infrastructure. This revenue driven approach will likely allow the technology to penetrate much more of rural America much faster then its predecessors.
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A question from Rob French of Seattle, WA:
A large number of very large players are rushing into this market to provide local news, arts & entertainment to consumers via the Web. What is your assessment about the potential size of this market? Given that only a small fraction of U.S. homes have Internet connections, why are so many companies willing to invest millions of dollars now?
Also, what are companies doing to port services like Digital City and Cityscape or other content into a cable/satellite/broadcast system?
Bob Smith of Digital Cities responds:
Rob,
Actually, I'd be very grateful if you'd dissuade a number of them from doing this. ;)Seriously, I think companies are making this move because:
- 1. The barriers to entry for creating content are very low
- 2. 70% of all advertising is locally-driven.
- 3. Margins on subscription access businesses are inherently low, and they ain't going up.
- 4. The market for interactive services is small now, but the bet is that it will eventually be huge. No one wants to miss out on the opportunity.
It is relatively inexpensive to create a local online service. There are no presses or trucks to buy, and no studios to build (necessarily). Add to that the fact that the print yellow pages business alone is $10 Billion per year (not to mention other advertising and transactions), and you have a recipe for a crowded field.Companies see that even if the market for local online services generates even a small portion of the total for all locally-based advertising and transactions it's a bet worth taking. Naturally, those who currently own the local advertising and transaction markets fear new entries like Digital City. We hope we can work with them rather than against them, though.
Rob Enderle of the Giga Information Group responds:
The perception that the Internet is the pot of gold at the end of the networked rainbow has, as you point out, attracted most of the entertainment and IT industries. The potential market exceeds the TV hardware, PC, and entertainment markets combined as the prognosis is that this "new" market encompasses these existing markets and more. Those in any of the industries effected see themselves losing out to competitors if they can not enter the Internet market timely, as a result they are rushing to both protect what they have and take advantage of the perceived gold rush before others walk off with the gold. The growth of the cellular and cable industries are perceived as indicators that the Internet could provide a significant boost to a companies revenue stream.
Rob French continues:
Also, what are companies doing to port services like Digital Cities and Cityscape into a cable/satellite/broadcast system?
Bob Smith of Digital Cities responds:
I'm waiting for someone else to figure it out. I believe that broadband delivery of services like Digital City will occur, and there are many interesting projects underway from phone and cable companies, but there seems to be some substantial short-term hurdles to clear before it becomes a reality. I think that people will be dialing up for Internet access for the next couple of years. But we'll be ready whenever the broadband technologies are there.
Rob Enderle of the Giga Information Group responds:
There are a number of initiatives to port, as you put it, the Internet experience to cable. The problem is cable infrastructure currently does not lend itself to this type of two way technology. @Home has already deployed trials of cable attached Internet users and HP, along with others, have developed cable modems. Even Direct TV (the little dish satellite guys) have a working project with Microsoft to solve this problem, in that case it appears they will have to have a POTS (Plain Old Telephone Service) back channel.
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A question from Raina Smyth of Seattle, WA:
In which cities are you intending to initially launch Digital City or Cityscape?
Bob Smith of Digital Cities responds:
Raina,
We plan to launch Digital City affiliates in as many cities as will have us. We will either do it ourselves or form partnerships with local media companies as we've done the Tribune Company in Chicago, Orlando, South Florida and Newport News VA. There will be working Digital City services in place in over 15 cities by year end. We should be heading up Seattle way in the not too distant future. I used to live there and can't wait to get back._________________________________
A question from Mark McFadden of Washington C.H., Ohio:
Will local nets receive public funding (taxes)?
As a administrator of a community based free-net in a small, rural Ohio town I wonder how small networks will thrive or even survive in the midst of an exploding number of commercial Internet service providers. Do you see a public funding source for these local nets? If so, how and what kind?Bob Smith of Digital Cities responds:
Mark,
There are gobs of companies like AT&T and regional phone companies who are just itching to get lots of people online. So it seems like the market can't wait to make this stuff inexpensive and broadly accessible as quickly as possible. I hope that the expanding Internet will soon make inexpensive access to interactive services as universal as phone service.I think the larger question is where might government best help to make these services as broadly available as possible? and which services should government encourage? Taxpayer subsidies to make it free for folks to use "ESPNET SportsZone" seems silly, while encouraging high-speed access to electronic libraries in a rural school district makes sense. It seems that government could incent large telecommunication or cable companies to provide such "good citizen" efforts without burdening taxpayers. But I must confess, you're a bit out of my realm of expertise here.
Rob Enderle of the Giga Information Group responds:
Currently the trend is to not provide public funding (PBS is an example where funding is actually being cut), but have the service either be subscription based or funded via advertising or donations. Since we are doing well on our subscription based funding I can testify that that is the most successful approach having yet to see companies based entirely on advertising revenue move into the black and I'm not aware of a successful site based entirely on donations (although there likely are some). At this time I don't see the government stepping in with a big funding program for public Internets, and neither of the platforms I've seen for the next election cycle seems to substantively change this. There may be specific grants, however, but I am not aware of them.
Additional Comments:Jim Murtha of Riverton, Utah:
The idea of the Wide World Web being both global and local is very interesting. In both scopes the impact that information can have on the lives of people is significant. I believe that local/regional sites should have links to what I call "democracy" issues. These include things like pending legislation and public projects that affect the community.
In the Salt Lake City area these issues would include preparations for the 2002 Olympics, lite rail, freeway and road construction, building new schools, public education and issues relating to economic growth. This would be a way to both distribute and solicit information. Surveys could be given to those who sign up on a e-mail list. The possibilities are endless. While there would no doubt be many issues and concerns to deal with during implementation, I believe this is an idea for public use of the Internet that needs to be seriously looked at.
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Terry D. Wright of Piqua, OH:
As I check into various libraries around the globe on the Internet I find that I can not locate information online but rather places where that information is kept. That isn't handy. Do you see in the future more actual information coming online instead of locating where copies of materials are available along with a listing of the hours the library is open. The distance makes the reality of obtaining that information unrealistic.
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Beth Hash of Bluefield, West Virginia:
Not everyone has a computer, with a modem, to enable them to access Internet for local networking. Considering this, could not schools, including colleges, become sites for community involvement in networking, particularly since many campuses have computer labs? Not only could adult community groups use these sites, but students could practice civics, or they could be a link to adult participation by gathering the opinions of their parents. Would greater access to school labs pose security problems? And if these labs became an local networking resource, wouldn't it be necessary for school administrators to hire consultants to initiate the networking programs and to train the managers of these programs?
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Michael Henderson of San Francisco, CA:
What threat does the advent of regional Web services pose to traditional media that may already be providing such servicses as traffic reports, local weather, entertainment, sports? Will local newspapers be affected more so than radio or television?
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