— Capital New York’s Tom McGeveran compares The Huffington Post’s content farm to AOL’s, noting how the “AOL Way” document jibes with the HuffPo m.o., and notes the peril for this business model:
All of this is very necessary if you’re getting the kind of low-end ad rates they get at giant places like Huffington Post and AOL.com. Instead of chasing advertisers for premium ad placements, which would require content they see a perfect narrow deep target market for, you’re chasing audience, to bring in the kinds of numbers that add up when you’re getting $1.50 for every thousand ads you sell. There’s almost no upper limit to how much crap you can sell to a wide audience, in theory. Except for one thing: Of course there is. And when that happens you have to look inward for more revenue opportunities that do not depend on giant, faceless audiences. But by the time you’ve made a product that works for cheap advertisers and ad networks, with comments from total bozos messing up your pages, you’ve lost the brand you need to have to find those kinds of revenue. You can’t ask your advertisers for more money.
This is something Gawker Media has always understood. Arianna has made more money in the short term, but the arts practiced at places like HuffPo and AOL will become “Black arts” eventually, to borrow a phrase from Jarvis.
If you’re like me and tend to think of places like The New York Times and The New Yorker and Gawker and Huffington Post when someone says “media” to you, rather than AOL or Yahoo! or Google, then this big purchase looks like even less of a “bet on news” than it does to most people actually in the business. The bet here is that a site can attract enough readers on a small enough budget that advertising will bring in significant profits without having to charge readers for reading. And at the moment, plenty of people think that is a long-odds bet already. It probably only really happens at the low and high end of the scale, for now, that kind of monetization.
(h/t Jay Rosen)
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Appealing to the "human spirit" - crass indeed. Or perhaps this post really was a critical part of the battle for a free press, as opposed to just a list of articles whose premises you happened to agree with.
Not that I mind - I usually like the stuff you link to, even if the commentary is a bit over the top at times. And this is one of those times - could you please spare us the laments about how marketing is so unseemly? Is it a problem that Pampers distributes free diapers to new moms? If not, what's wrong with other companies distributing their products, assuming they are not patently harmful (e.g. the formula example)? And what's with the implication that a detailed disclosure of all their affiliations with other companies is necessary?
I imagine it's only necessary to people like this reporter, who find the idea of Disney expanding into any market distasteful on its face. Perhaps they assume that mothers would agree.
C'mon - this article seems to be more about the reporter thinking "no, not another market, not them!" - why else would the issue of their "financial ties" to the company distributing the products even be relevant, or a potential problem?
#1 Posted by Steve, CJR on Tue 8 Feb 2011 at 06:57 AM
"Indian tribes are helping the skeevy payday-loan industry evade state regulators."
And good for them. Americans still have somewhere to go for the peaceful, free, voluntary, and mutually beneficial exchange of goods and services.
#2 Posted by Dan A., CJR on Tue 8 Feb 2011 at 01:33 PM
The leftist concept of "protecting the consumer" is only fostering regulation after regulation and growing the government by leaps and bounds. I say let the consumer decide what is a good deal, and that goes for all consumption, including food, medicine, health care, automobiles, appliances, and payday loans for customers with less-than-perfect credit. Get the dumb bureaucrats out of the business of determining what is good for us and what isn't. We can make our own decisions.
#3 Posted by Matt Depp, CJR on Tue 29 May 2012 at 02:41 AM