ESPN has announced it will launch ESPNChicago.com in April, the first of what may be a series of local niche sites. By entering this market, ESPN seems to be aiming to capitalize on the dip in local sports coverage at both local TV stations and newspapers. The move also puts the king of cable sports head-to-head with regional sports nets such as FSN.

The new site will even feature a Web-only local edition of the popular “SportsCenter” show and feature contributions form anchors and reporters with ties to the Chicago area.

This is an interesting move for ESPN and more bad news for local newspapers and TV stations. Local sports coverage is one of the strongest assets local newspapers and TV stations have to offer and many have done nothing but cut back on it. Very often these local sources are the only place to get some of this so-called “hyper local” coverage that’s very popular among the public.

This speaks to the trend of the increased use of wire copy, page reductions and reduced airtime for local content across the board — a strategy that, while cheaper, is really no better than shooting yourself in the foot. Local media needs to focus on being just that; there are a million other places to get national news, health news and the other content newspapers and TV stations are using to fill time. Sure it costs more to have local reporters and crews, but ultimately the payoff is much bigger if done right.

Some station groups have attempted to capitalize on the local sports market, such as Hearst-Argyle’s HighSchoolPlaybook.com, but time will see if those efforts will ultimately pay off.

It’s also interesting to note the use of the ESPN(CityName).com branding, similar to that being used NBC O&Os.