A FORMER Sunday Times journalist is set to launch a franchise micropublishing business that aims to be an antidote to the newspaper industry's plunging circulation and advertising figures.

Peter Hounam - the broadsheet's former chief investigative journalist - and business partner Brendan Murphy aim to roll out dozens of local news magazines across Scotland devoted to the interests of small communities.

The monthlies, coupled with daily web editions, would provide vital local information and tap into small businesses that cannot afford larger newspaper or radio advertising.

Hounam hopes that national paper groups will capitalise on the idea, and establish formal link-ups with the various local websites, as a way of cultivating a loyal pool of new readers at a grass-roots level. Website visitors could click through and be redirected to The Guardian or The Times for national and international news.

Hounam said that national papers are spending a fortune on building websites that merely mirror their print products rather than looking for new ways to tap into underserviced segments of British society.

"The trick in building brand loyalty is to have a foothold in the very roots of society," Hounam said. "Our network of highlylocalisedcommunity-based news magazines with a vigorous web presence will provide that opportunity."

The concept is based on Comment, the local news magazine and website that Murphy has spent the past 25 years developing in a 1000 square mile patch in Perthshire.

Most of the editorial input is generated by people in the community so costs are kept low. The operation earns £23,000 annual profit from a rural community of 11,500 people.

Hounam and Murphy are now hoping to replicate that by selling franchise packages under the banner LocalExtra that would include the software and all the necessary publishing resource.

The start-up packages could cost in excess of £10,000. A franchisee would pay a percentage of turnover after one year, the rate of which has yet to be set. Hounam said that a local business could be operated by two people working part-time. Finance for the launch of each new LocalExtra outlet will be provided by the local franchisees.