Guardian head of digital engagement Meg Pickard said today the project was "not sustainable in its present form", despite having "found engaged local readerships and had good editorial impact".
A statement from the Guardian added that "significant further investment would be required for the project to grow and develop ... The nature of digital innovation means investing in and trying new things, but also knowing when to call it a day."
The three Guardian Local sites were launched in March 2010, with Sarah Hartley as editor and John Baron, Hannah Waldram, and Tom Allan tasked with covering Leeds, Cardiff and Edinburgh respectively, focusing on council activities and citizenship.
Allan left the project in August 2010 and was replaced by Michael MacLeod. All three beatbloggers worked for the Guardian on a freelance basis, and according to the newspaper's press office they are currently in consultation with the newspaper.
MacLeod, who had previously worked for a national press agency and local newspaper group, revealed on his Tumblr site today that following closure of Guardian Local he is looking for "new challenges".
In July 2010 the Guardian released traffic figures for the sites for the first time. The Edinburgh site had the most monthly unique browsers with 36,588, Leeds had 32,678 while Cardiff recorded 24,160 over the same period.
Pickard said today that community news efforts would continue on Guardian.co.uk, citing its Cutswatch project, which encourages people to report on local council activities in their area.
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