The upcoming New York Times Magazine features interesting examination into the entrepreneurial exploits of Apple. Not that Apple. Sam Apple. The journalism entrepreneur.
http://www.nytimes.com/2010/05/16/magazine/16Journalism-t.html?ref=business
With traditional media outlets facing bankruptcy and yet plenty of people wanting to be professional journalists, Mr. Apple smelled opportunity. The 34-year-old former interactive media director launched The Faster Times last July. The idea was to counter the proliferation of amateurishly produced blogs with a staff of trained journalists paid not in salary but by 75 percent of the revenues from the advertisements placed next to their articles. Contributors to this capitalist collective would profit according to the market’s value assessment of their individual work.
Of course, in this set-up, who covering Bolivia would turn out to be less lucrative than covering (or uncovering) Jessica Simpson.
American journalism has always relied on advertising (80 percent of revenues for newspapers). The thought was that vast online audiences would deliver vast advertising sums. It didn’t work out that way, because there is vastly more content competition online and ads sell for a small fraction of their print cousins.
True/Slant. five employees and 300 part-time contributors delivering “entrepreneurial journalism” to a million readers a month,
True/Slant reduces costs by eliminating old fashioned editorial hierarchies and making its contributors the sole “programmers” of their content. “Newsrooms today are high-cost, inefficient content-creation operations that will not be supported by advertising revenues in the digital world,” Dvorkin tells the Times. “It just won’t happen.”
True/Slant’s low-cost newsroom churns out around 125 pieces of content a day, hoping to pick up pennies and nickels from online PPC advertisers.
Other revenue models: a generous benefactor like The Daily Beast has in Barry Diller; NPR’s nonprofit model; Politico’s paper version. And that old standby, subscriptions – which so far only the online Wall Street Journal and Financial Times are working with success. (The New York Times has just announced a paywall going up in Januay 2011.)
Examiner.com, owned by the billionaire Philip Anschutz, generates more than 3,000 items per day from 36,000 local contributors, who are paid about 1 cent per page view.
The Huffington Post, the most successful of the new breed, boasts 70 salaried editorial staff members and 6,000 uncompensated bloggers who churn out 500 items a day. According to Nielsen Online, it gets more hits than the online Washington Post and is among the top 10 current-affairs sites,
True/Slant contributors are paid a monthly retainer and bonuses based on how many people read their articles. Most writers make a few hundred dollars a month if they hit their traffic targets, and a few big names like Matt Taibbi make more. The company isn’t profitable yet: An individual article is worth only $10 to its bottom line.
Started in July 2009 at a cost of $20,000. It soon had a monthly audience of around 200,000 readers, according to the tracking site Quantcast. Revenues that were coming in from Google AdSense, gave writers $5 to $75. Pretty crappy, in other words. No wonder then that many of the original FT contributors moved on. Mr. Apple continues to experiment with payment models.
Web start-ups have a failure rate between 70 and 90 percent. But even with those Darwinian stats, a sustainable business models is likely to emerge.
