Denton Is A Smart

Nick Denton has a Q&A with Michael Learmonth of Ad Age. There’s a snippet on SAI. What I’ve seen so far seems really sharp. For instance, the below quote, via Lunch Food:

Mr. Denton: When Gawker started, there was a surfeit of information and not nearly enough context — so we provided that, in the form of links and occasionally snarky commentary. But now the balance has shifted. There are pointers to articles on the blogs, Facebook, Twitter, Digg. And all these intermediaries are looking for something to link to. If a good exclusive used to provide 10 times the traffic of a standard regurgitated blog post, now it garners a hundred times as much. That should be reassuring to people. The content market is finding its new balance. Original reporting will be rewarded.

This has nothing to do with the above, but I think a smart thing Denton/Gawker does is place the Gawker artists series around the content. If it were blank or just banner ads all the time, I would never look at them. Since they’re art, I check them out. When there’s ads in there, I still look, because suddenly I’ve been conditioned to look over there.

I’m not sure if the success of the program is measurable in any real way, but it’s one of smartest things in online publishing I can think of. It’s an argument that less can become more. The argument becomes even stronger when you look at the giant ads that are taking over his sites, as well as the Times and ESPN and the Journal.

Ad Age: Gawker adopted some of the bigger ad formats, now the rage at places like NYTimes.com. Did that help?
Mr. Denton: People have faster connections and bigger screens — and the editorial images are getting larger. It’s about time that the advertising caught up. Nobody complains that the ads in Vanity Fair are lavish. Why should premium sites on the web be any different? With about 13 million unique visitors in the U.S., we finally achieved scale. We’ve been more willing to provide value to advertisers — in the form of our giant marquee ads, for instance. And I do wonder whether online marketers are finally distinguishing between crappy networks and online properties with genuine followings.

It’s Beginning

Well, here we go. The year of charging for content is underway. The S.F. Chronicle is exploring how to charge for some of its content. My hint to you: don’t charge for the OP-Ed section. Maybe if you find some definitive evidence that Barry Bonds used steroids, charge for that, though.

S.F. Chronicle may charge for web content – San Francisco Business Times:.

Prepare Yourself For A Year Of Charging For Content Talk

Alan Mutter, the ‘dean’, of analysing the newspaper biz fires up the controversy machine with a blog post called “Why media must charge for its content.”

It’s a longun and I haven’t read it yet. However, I anticipate it will start a long string of blogs debating the fineries of his points. I’ve already advocated for news businesses charging for their content in the past. It’s not for every company, though. Could the Rocky Mountain News exist as a paid web product? I’m guessing not. At least not with a staff of more than 30. Could the New York Times charge for its product? Probably. If not them, then who exactly?

The problem with the web is that it is hyper competitive and has a tendency to cut all prices to zero. If a bunch of newspapers want to move in a coordinated manner and start charging for their content, then great, we’ll all have to pay for news. But if 30 papers start trying to charge and 10 don’t, then those ten will likely get bigger pageviews. They can blog the news that’s behind the paywall and they can also report original pieces. They’ll get bigger viewers, more advertisers and probably make more money. But, maybe not. I really don’t know.

It just looks like we’re in an untenable situation that can’t hold with or without paywalls.

NY Mag Let Google Scan Its Entire Archive

New York Magazine let Google scan its entire archive and put it online for free. Why? According to their digital head in this video, they weren’t sure there was much value in the archive. Makes sense to me. He says NY Mag will get more use for itself by having an easily searched and indexed archive of its magazines. If there’s a revenue opportunity down the road then so be it.

more about "NY Mag Let Google Scan Its Entire Arc…", posted with vodpod

The Internets

I’m in full radial blogging mode for the Silicon Alley Insider group. I’m helping them out with a ton of different projects, so I’ll have less time for this. Sorry.

Hulu Already More Profitable Than YouTube?

Update: Alley Insider disagrees with what’s written below.

Last night, the FT reported that YouTube and Hulu would be even in revenue by 2009. Turns out that’s gross revenue. In terms of profitability, Hulu is already way up according to All Thing’s D’s Media Memo:

Media Memo: But I had questions about the data, reported by the Financial Times. So I called Arash Amel, the Screen Digest analyst who provided the numbers. Glad I did, because Amel’s analysis is actually much more provocative: He believes Hulu is already making more money than YouTube.

The short explanation: The numbers that the FT reported are gross revenue — total money received from advertisers — not net revenue –what’s left over after paying for the video.

If you’re talking about net revenue, Amel says, than Hulu, a joint venture between News Corp.’s Fox (NWS) and GE’s NBC (GE) is already making a small profit — perhaps $12 million a year. And he believes that Google’s YouTube (GOOG) is still losing money every year.

The longer explanation: Amel’s model assumes that while Hulu is showing far fewer video streams to many less people than Google does, it is able to sell ads on most of them — perhaps 80% of all streams have a paying advertiser, he thinks. Google, meanwhile, is thought to be able to sell ads on just 3%-4% of its views.

Just as important, but not widely discussed: Amel believes that YouTube’s costs are much more significant than most observers guess. That’s because YouTube isn’t just paying massive bandwidth and hosting costs for all those clips. It’s also paying out huge licensing and content fees to copyright owners like music labels.

Amel thinks YouTube is paying more for those fees than it does for infrastructure/bandwidth. This dovetails with what an industry source told me last week.

Amel won’t be publishing a full report on his analysis until next week. But he was able to break down his numbers for me over the phone. There is one obvious problem here. While he’s worked out a set of fairly detailed numbers for Hulu, he can’t get any more specific with Google other than it’s “loss-making”.

Hulu:

2008 gross revenue for US: $70 million

Net margin (factors in payments to affiliates, content owners; and infrastructure costs): 15% – 18%

Net revenue: $10.5 million – $12.6 million

YouTube:

2008 gross revenue for US: $114 million

Net margin: None

Net revenue: None.

Suddenly The Veep Pick Is Less Important…

From The Business Sheet: Hank Paulson says he will not be the Treasury Secretary next year. Who could blame him? He and his crew have worked every day for the past 5 weeks trying to sort out this mess. Some of his staff are working 20 hour days and the Wall Street Journal reports one employee, recently moved to Washington from Texas, has only seen his family once since taking on his job alongside Paulson.

When Paulson hands the reins over to the next Secretary, that person will be facing a whole new set of responsibilities thanks to the government’s newfound taste for toxic assets and insistence on greater regulatory power. So, it’s kinda important to know who might get the nod if McCain wins or if Obama wins. Maybe even more important than the Vice Presidential pick that got so much attention a few weeks ago.

Today, New York Magazine’s Intel blog floated the idea of Merrill seller, John Thain joining the McCain camp. After all, Thain is a bundler that raised $32,700 for McCain and he was already rumored to be in the running for a possible Treasury job. Of course, Thain is the same guy that couldn’t turn Merrill around, opting instead to sell it. Not exactly the best credential for someone looking to tackle this economy. Phil Gramm was rumored to be in the running until he screwed up and said Americans are suffering from a mental recession. Carly Fiorina was also in the running, until she said Sarah Palin could run Hewlett-Packard, and now her status in the McCain camp is in jeopardy.

At the end of August, Deal Book, a Wall Street Journal blog assessed who might be in line to become secretary if Obama won. Timothy Geithner, the New York Fed president, who has been Paulson’s point man in the past week, was atop their list of people Obama was rumored to be interested in. The other names suggested were Jaime Dimon, JP Morgan’s CEO, and Jon Corzine, former Goldman CEO and current New Jersey governor.

Each of the rumored Obama picks appears to be a great choice, and he should try to exploit this advantage, before McCain pulls out a personably quirky economic advisor from an iceberg and excites the nation.

The Bride, Groom & Ceremony

The happy couple. Plus some pics of the ceremony. Rick rode a horse to the place of the wedding while we danced around him, then his family and her family exchanged garlands.

Rick Bain’s Wedding

At my best friend from high school’s wedding. It’s awesome.

Long Live The A-Hed!

Please don’t take these away Mr. Murdoch.

From the Journal, I Just Need To Fold Clothes:

…The ranks of obsessive folders have swelled in recent years as a generation of Americans has done stints as clothing-store clerks. According to the U.S. Bureau of Labor Statistics, annual nonsupervisory employment in clothing and clothing-accessory stores grew to nearly 1.3 million workers in 2007, up nearly 20% from 1990. Gap Inc. says it has trained “hundreds of thousands” of Gap store employees in the art of folding since the late 1980s.

Along the way, legions of retail grads have spent countless hours neatly folding T-shirts and jeans and stacking them on tables and shelves. Now, their peculiar idea of perfection is straining marriages and leading to bizarre behavior ranging from buying clothes based on an item’s foldability to straightening up sloppy displays while shopping.