EBay founder plans Island news service: Public interest, civic affairs to be focus of online operation

Omidyar said yesterday that he plans to launch a local online news service covering public interest and civic matters affecting Hawai'i's communities.

The yet-to-be named venture, which will debut early next year, could serve as a test for other markets, said spokeswoman Sara Steven.

"So, we're starting something up in our own backyard. We are creating a Honolulu-based local news service that will produce original, in-depth reporting and analysis of local issues in Hawai'i," Omidyar said in an online post yesterday.

The news operation will be a for-profit business and will include content generated by staff writers and citizen journalists.

It's part of the Peer News Inc. operation, the Hawai'i-based company that Omidyar and former eBay executive Randy Ching set up in 2008.

Omidyar said he is looking to hire an editor for the news service, and for the startup he said he's enlisted the help of Howard Weaver, a longtime news executive with California-based McClatchy Co.

Like the newspaper and broadcast industries, online news services face a number of hurdles, including the weak economy, a sluggish advertising market and considerable capital investment requirements.

Building a network of local news sites in communities across the country is an uphill battle, experts said.

"You need the investor of the caliber of Pierre to make this work," said Alan Mutter, a former newspaper and cable television executive who now writes a blog called "Reflections of a Newsosaur."

"So far, it hasn't been done before."

A Honolulu resident since 2006, Omidyar founded eBay in 1995 and still serves as chairman of the Internet auction company.

The 42-year-old Omidyar's net worth recently was estimated by Forbes magazine at $5.5 billion.

Last month, he and his wife, Pam Omidyar, pledged $50 million over six years to local nonprofits in one of the largest-ever charitable gifts in Hawai'i.

Paul Grabowicz, associate dean at the University of California-Berkeley Graduate School of Journalism, and head of the school's new media program, said thousands of online news sites have sprouted across the country in recent years in the wake of the news industry's downsizing.

Most are nonprofit organizations with small staffs that focus on local community and neighborhood issues that aren't getting much coverage by traditional media these days, said Grabowicz.

Of the sites that operate on a for-profit basis, some like West Seattle Blog and Baristanet in New Jersey are profitable, he said.

"There are thousands of these sites operating today. It is a trend. It is real," said Grabowicz.

"What is unclear is how much money they are going to make, and what is the right model for making them sustainable."

Reach Rick Daysog at rdaysog@honoluluadvertiser.com.

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