Pierre Omidyar experiments in Hawaii with 'new way to do journalism that connects with ordinary citizens'

The founder of eBay – the virtual marketplace that connects sellers and buyers worldwide – is launching an online news site where people will pay to exchange ideas and discuss issues affecting their communities.

Pierre Omidyar, the chairman of eBay Inc, is entering the news business with an online service in Hawaii. By charging $19.99 (£13) a month for membership, Omidyar hopes to accomplish what newspapers and other media organisations have long struggled with – having readers pay for content and making local news profitable.

"It's really critical to help find a new way to do journalism that connects with ordinary citizens in a better way," Omidyar said in an interview. "I think that is what's been lacking. Because the industry has been preoccupied with its own decline, it hasn't had the opportunity to reinvent itself.

"As a new startup, we have the opportunity to reinvent that and bring journalism back into the centre of conversation."

Civilbeat.com promises to provide in-depth reporting and analysis and be a civic plaza for island residents. "Reporter-hosts" will post articles, interact with readers, provide frequent updates and host discussions.

"Journalism plays a central role in the way democracy works, especially in this country. And our democracy doesn't work when journalism doesn't work," Omidyar said. "As I saw the decline in the industry, I really became concerned especially with our local communities not just here in Hawaii, but nationwide."

Omidyar decided more than two years ago to launch a news service to cover local civic affairs, including the state, city, education, land and money. "It's very important for me that we demonstrate that we can do this sustainably," he said.

Another unique aspect will be the discussion section. Unlike traditional newspaper online comment sections which are often marred by hateful, obscene, racist or mindless commentary posted by anonymous readers, Civil Beat members will be identified and no anonymous comments will be allowed.

"We'll have a billing relationship with them and so we know who they are," Omidyar said.

Gerald Kato, chair at the University of Hawaii school of communications, said newspaper subscribers were coveted because they were considered to be older, wealthier and better educated. But many had been turned off by what Kato described as "crazies" who participate in unmoderated comment sections.

"They're trying to flip that around. They want all these high-end people that would gravitate toward a newspaper, but want to filter out all the crazies," Kato said. "The filtering mechanism would be: you pay to play."

Omidyar said he was hoping to encourage a "higher level of conversation". "I think the quality of conversation is going to be something which really creates a sense of value for people," he said, especially for people who are concerned about issues in their community and want meaningful discussions and debate.

The unassuming Honolulu billionaire declined to say how much he has invested so far. The editor of the news service is veteran newspaperman John Temple, who served as editor, president and publisher of the Rocky Mountain News, which ceased publication in February 2009.

Omidyar points out that, unlike a newspaper, he has no printing presses, trucks, sales staff or other "legacy" obligations. He said having a membership payment provided instant feedback from the readers. He called traditional news organisations "advertising based", with publishers answering to advertisers instead of the community.

"I think having a more direct business model will help us and I think it's going to be part of the future for the industry as well," he said.