Hometown News Service is a hosted content management system for small to medium local newspapers. They have an application into the Knight News Challenge as well where they want $250,000 funding to continue developing their CMS, make it easy to deploy, and then open source it. They have 75 paying clients right now and 12 employees so I’m not entirely sure how this fits into their strategic goals.
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It’s a good idea, for sure. But will Knight fund yet another CMS project through the News Challenge? It seems unlikely, even though Knight does like Drupal-based projects:
http://groups.drupal.org/knight-drupal-initiative