Fwix Adds Video to Hyperlocal, Bringing Exposure-–and Revenue–-to Vloggers

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In a year that wasn't particularly kind to traditional media outlets, hyperlocal news aggregator Fwix hasn't missed a step. In September, the San Francisco-based startup released an API allowing online publishers to add local news feeds serving more than 80 U.S. cities and communities to their sites. By early November, it pioneered a unique revenue sharing arrangement that ensures both content creators and publishers share in Fwix's ad revenues. This morning, the company is taking the next logical step, adding hyperlocal video news to its feeds, turning a growing pool of locally focused online video content into a vehicle for revenue growth.

"Before, we didn't think we could do video," Fwix's 22-year-old founder and CEO Darian Shirazi told Fast Company. "Now that we can, it adds a lot of color to the widgets and the sites they are on. The feature is simple as far as what we're adding, but it will monetize much better."

Several media companies—including behemoths like The New York Times Co. and AOL—have tried to flip online, community-driven journalism into the savior of a failing media model. By tailoring precision-targeted ads to news sites serving highly specific communities, media companies hope to tap into $13.8 billion local online ad business in 2010. Thus far, big advertisers haven't shown much interest in the content, which is often gathered and produced by local bloggers or "citizen journalists" rather than professional news organizations. But local advertisers are pouring more and more ad dollars into targeted online ads, and companies like Fwix are looking to carve out their piece of that market.

Fwix video"Citizen journalism is huge, and I think that it's going to become even bigger for video," Shirazi said. "Not only are more bloggers and citizen journalists creating video content, but the production quality is getting better and better." With that steady increase in quality comes a better vehicle for ads. While placing ads within Fwix's story streams generates some click through revenue, the ability to embed pre-roll ads into video packages opens up an additional level of user engagement with both the content and the ads.

"People click on a video because they want to see it," Shirazi says. "They want to see it so much they're willing to sit through a 20- or 30-second ad," As such, Fwix will install pre-roll advertisements akin to the short ad spots that play prior to programming on Hulu. Several factors will determine which videos are packaged with ads, including who the viewer is, what sort of site is hosting the Fwix stream and whether or not that particular stream is getting a lot of clicks. The driving idea behind Fwix, after all, is getting the right content in front of the right people in a highly targeted, tightly focused manner.

Shirazi and Fwix are counting on that kind of precision targeting to bring in the ad revenue that has eluded previous attempts at hyperlocal aggregation. By allowing both site owners and content creators to share in the ad revenue, Fwix has created an incentive for publishers to keep their Fwix widgets on their sites, and for content creators to keep churning out the news. No one is retiring on the ad revenue from Fwix, Shirazi admits, but it's a good deal better deal than nothing. Given the unforgiving media landscape out there right now, better than nothing actually sounds pretty good.

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