Covering the business of digital media since 2002

paidcontent.pngNEW YORK, NEW YORK — In 2008, when Guardian News & Media bought Rafat Ali’s ContentNext Media, Ali wrote that the acquisition marked the “2.0 phase” of his company. It was an aptly webby phrase from the man who six years earlier founded ContentNext’s flagship site,, with the aim of obsessively covering the economics of the then just-emerging world of digital content. And the phrase aptly conveyed just how different Rafat Ali’s company was in 2008 than it was in 2002. Today, if you want the latest on the Comcast-NBCU deal or Pandora’s value, paidContent is a first stop. But back then, the leader in news about digital content was a modest curiosity.

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    • In the early days of ContentNext’s “1.0 phase”–before the launch of the mobile content-focused vertical and a UK paidContent–it was just, the unassuming blog Ali started in a Manhattan diner while working as the managing editor for Silicon Alley Reporter. It really was just paidContent. The swollen “niche” of sites covering the economics of digital news, stuffed as it now with TechCrunch, Business Insider, All Things Digital, among others, was still very much a traditional niche back then–small, and with paidContent practically alone in occupying it.

      Staci D. Kramer, now paidContent’s editor, joined Ali in 2004, just as the site was beginning to take off. Ali was planning to take personal leave and knew he couldn’t leave his site unmanned–advertisers and readers needed him. “That’s when you know it’s a business,” says Kramer. “When you can stop it and start back up again, it’s a blog. When you have people paying to see it every day, it’s a business. You’ve got to treat it that way.” (And don’t be confused. With advertising and sponsored content, paidContent is a business. Ali only went with “.org” because he loved the name and “.com” was taken.)

      Treating it as a business meant hiring Kramer to keep the site running. Kramer, like Ali, an alum, spent her first years writing and hand-coding the paidContent daily newsletter and torturing herself fitting stories into an early, clunkier version of MovableType for the website. (Today paidContent runs on ExpressionEngine.) The audience then was as specialized as the outlet. “There were two kinds of people,” says Kramer. “Those who were the only people in their companies responsible for the technology side; the digital person who would explain it to everyone else. Or there were the people who saw digital as a whole new business. They were creating companies and carving out a space.” The site’s content was exactly what those groups would be interested in: big corporate purchases, innovative startups, funding, new projects, and new players.

      From the beginning, the paidContent team’s philosophy was to feature one-third analysis, one-third breaking news, and one-third aggregation. They’ve stuck to that through the evolution from scrappy startup to market leader. Executive editor Ernie Sander joined the site from the Wall Street Journal in 2008, and runs the news operation while Kramer writes for the site in addition to editing and programming conferences. Today, the team consists of nine editorial staffers–including three staff writers and a UK editor–and seven more business-side employees, including COO Caryn Whitman. They operate in downtown Manhattan’s “Radio Wave Building”, sharing space with the Guardian, but only Sander, two reporters, an intern, and the business staff are in that office full-time. Kramer splits her time between New York, a home office in St. Louis, Mo., and anywhere else her busy travel schedule takes her, and the rest of the staff is spread across Los Angeles, San Francisco, London, and Cardiff. From these various loci, the staff pushes out paidContent’s free, ad-supported content out five days a week through AM newsletters and seven days a week via Twitter and through a stream of stories and analyses published at the website throughout the day. “We run from UK AM to West Coast PM and back again,” Kramer says.

      Kramer says she knew the site was gaining traction when it was breaking stories on Hulu “before it was Hulu” and on big Disney acquisitions. She knew the site was a major player when Les Moonves spoke to her before anyone else the day CBS bought CNET Networks. “We were ahead of the wires and everyone. That was a major moment. That’s one of those signs.” So too was the acquisition by Guardian News and Media. Though paidContent stories feature in a module on the MediaGuardian website and paidContent itself uses some of the Guardian’s content, Kramer stresses that paidContent is owned by the Guardian‘s parent company and is completely autonomous from the Guardian newspaper. Some business functions for the two publications are combined, but paidContent maintains its own business staff.

      As the world embraced digital content–certainly, few people today are ever the digital person in their company–paidContent readers have become more general and the site more well known. A friend in the cable business who once couldn’t understand what Kramer was doing at paidContent, or why she joined the company, had a change of heart when his company launched a broadband product and Kramer interviewed him for the story. “He got on the phone and said, ‘Okay, now I get it,'” Kramer recalls.

      Of course, as any Spiderman’s uncle will tell you, power and prominence bring responsibility. And entering something of a 3.0 phase, paidContent is perhaps the most prominent outlet in its field today. Annual events like the paidContent conference, which consistently attracts the biggest names in digital content to its talks and panels, and the publication of the paidContent 50, a listing of the fifty most successful digital media companies in the country, have earned it attention and respect. The website is the first place many turn when a big digital story breaks. Its founder, Ali, who officially left the company in 2010, but who had been scaling back his involvement for some time before that, is a something of a digital rock star.

      The responsibilities that this level of success brings are two-fold, says Kramer. First, she, Sander, and the rest of the paidContent team strive to stay on top of competitors by providing contextualized news. This means, for instance, that when the Times paywall was the big story, paidContent reported on it by comparing how much News Corp. spent on The Daily with the money the Times spent on its paywall. PaidContent also makes use of its various beat reporters, who cover everything from mobile to advertising, and now, book publishing, to get at stories from a range of angles.

      Second, Kramer says paidContent works hard to maintain the reader trust the team has built over nine years. “We report some things where our credibility has to stand for the story,” she says. “We can’t say where it comes from; you have to say, this is what we believe, this is what we’ve been told, and this is what we think about it. That people are likely to accept it as being real from us gives us a lot of power, but also a lot of stress. You don’t ever want to blow that, and if you’re wrong, you have to say so.”

      The stress is worth it for Kramer. Walking into the Radio Wave Building, where Nikola Tesla experimented with radio wave technology in the late nineteenth century, she says she feels a strong connection. “I love that this building, as old as it is, is all about doing something new. I still get a charge when I see it. It sounds geeky, but I am geeky, and I don’t mind.”

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Joel Meares is a former CJR assistant editor.