In Australia, I haven’t seen any newspapers go "hyper-local" with their own content on their websites, however News Ltd has created several hyper-local sites that are their own separate entities.

No doubt, over time, editors will take advantage of the local user-generated material on these sites and use it for articles in the parent newspapers. I would imagine that users are more likely to contribute to smaller, more ’homely’ websites such as these rather than a ’local’ section on a the main newspaper website.

Mark
http://www.raveaboutit.com.au