We already know that Arianna Huffington is smart. She and her small team have built a media company from nothing in just a few years, and now they’re flipping it to AOL, where she’ll be content editor in chief. The price sounds bizarrely high to me at $315 million, but so do lots of prices these days in what looks like a new Internet bubble.
Others have commented at length on the synergy of the deal. If AOL is going after a link-driven community, the blend could work in the long run. The Huffington Post has been evolving from its origins, as the left-wing op-ed page of the Internet, into a blend of aggregation, curation, pandering — all of which have been done with some genuinely intriguing if not innovative technology initiatives — and some home-grown content. The first three of those are likely to be, in the end, much more important for the business than the original content.
AOL has been rolling the dice at an ever-more-frantic rate lately on digital content. The reported $25 million it paid for TechCrunch made sense to me, and I think it’s way too early to say, as many are doing, that the Patch local-news service is failing. But there’s a common thread in many of the content initiatives: paying low (or no) money to the people providing the content, and having lots and lots of it.
Indeed, the Huffington Post’s home-grown content, for the most part, has been especially notable for its low cost to Huffington: low as in free. Although some actual paid journalists work for the organization, her blogger network is an amazing achievement; she’s persuaded untold numbers of people to write for nothing, to have their names on the page as compensation for their labor. Exploitive? Sure, in a way, but let’s also recognize the fact that people want to put their stuff on the site. No one writes for the New York Times op-ed page for the money; it’s for the platform to spread ideas.
And, based on the email Huffington sent to her bloggers, that’s the model she plans to continue. Here’s part of that email:
Together, our companies will have a combined base of 117 million unique U.S. visitors a month — and 250 million around the world — so your posts will have an even bigger impact on the national and global conversation. That’s the only real change you’ll notice — more people reading what you wrote.
It’s hard to imagine something that sends a more dismissive message. Which is why I’m hoping that Huffington will recognize how this looks and then do the right thing: namely, cut a bunch of checks to a bunch of the most productive contributors on whose work she’s built a significant part of her new fortune. They’ve earned some of the spoils. I think Huffington is smart enough to know not just the PR value of doing this. And, and feel free to call me naive for saying this, I also think she’s wise enough to know why she should do it on more ethical grounds, too.
Hear, Hear! It was only recently that I discovered HuffPo didn’t pay many of their writers. I was shocked considering the lower quality Examiner.com at the least makes an attempt to pay writers (even if they pay pennies per click). I hope some of the $315 million doesn’t only go into paying writers, but also fact-checking their science writers. I don’t mind screwed up facts on a little known blog, but when a HuffPo writer finds that blog and simply echo reports what is written instead of checking the facts and thereby boosting the misinformation to a larger audience I’m often reduced to tears (not literally).
Hear! Hear! The HuffPo business “model” is only good for the fatcats at the top. Time to pay the folks who do the day-to-day.
Seriously?
The internet is littered with past and present examples of using unpaid labor to create companies that benefit only a small number of players. Think content farms and social sites. Because of the kindness of strangers and their passions, there will always be folks who will take advantage.
This is the new internet business model. Slamming advertisements against content just continues the ad supported business model which carried tree based publications until the internet changed the cost equation of publishing.
With the ad serving and tracking tech available and in use it is just a matter of time before articles and stories are generated by algorithm, and then they can just eliminate humans out of the equation entirely. Then the whole idea of having people in the mix becomes moot.
Paying folks to write? How 20th Century!
It has long amazed me that liberals would support a plantation like the Huffington Post. The merger with AOL scares me, given the recent leak of documents in which AOL tells its editorial staff to not report, but to generate more hits. I’ve edited websites and I understand the name of the game, but I also understand the importance of journalism.
I’m in total agreement with you Dan – but if I were a betting man, I’d have to put my money on “it aint gonna happen.”
I don’t think it’s the right thing to do – but it’s how I suspect it will play out.
She can’t pay anyone – cause it’ll open up the floodgates and if those floodgates were to open – cash would fall out.
HuffPo bloggers have a symbiotic relationship with the Post – just like the pilot fish who swim around sharks and gorge on the shark’s parasites
Instead of trading content for cash, it’s content for exposure.
And yet, $315 million is a lot of money…
Data point to gather: what percentage of total pageviews contributions from this unpaid labor force comprise…
The reason she doesn’t pay bloggers is because she doesn’t have to. If these bloggers are so talented, then they can make good money with or without the Huff Post. My guess is that most of these complaining bloggers don’t have unique talents, and that is why they are as plentiful for Arianna’s picking as the fruits sold on street corners.
1) valuation seems very, very high …
2) reminded of myspace sending out an email begging users to come back – web allegiance / traffic patterns can and do switch over time … what was the price on myspace when murdoch bought it? the worth of the site now?
Just a week ago, AOL’s Grand Unified Theory of the Content Universe was leaked, revealing the low regard that AOL’s new management has for what we would consider quality journalism. According to the AOL Way, hits and pageviews and volume are more important than news quality.
Now, AOL pays an astonishing amount of money for HuffPo, which, despite avoiding the cost of paying its bloggers, ekes out revenue that is an order of magnitude less than the selling price. More interesting: AOL cedes Total Editorial Control to Huffington. This reveals that AOL had/has no clue as to what it is/was doing, and is hoping that the Huffington Way will save the company. This marriage of Volume over Quality with Free over Paid Content is not encouraging.
And when is Patch–whose parent is AOL whose parent is Time Inc.–going to start paying college interns signed up for PatchU to be reporters in local communities under the guise of earning college credits?
Unpaid writers ask: “Hey Arianna, can you spare a dime?” http://www.facebook.com/heyarianna
more ethical grounds? LOL…you think those posters on HP that cursed and belittled the republicans are expecting her to “do the right thing”….lol…..
The bloggers who were published without monetary compensation 1. agreed to the deal, and 2. did so because they got value in return (exposure, audience, etc.). Their investment wasn’t monetary and their compensation wasn’t monetary.
For them to stick their hands out now assumes a different situation and feels opportunistic, that they should be given a monetary return even though someone else took the financial risk.
If THP had gone under would someone be passing the hat to them to reimburse the investors?
I’m with @CWilliamson. Did anyone who wrote for THP for free think it was a charity? It’s always been a for-profit enterprise.
That said, when I sold my first company I compensated the early management team beyond my contractual obligations, because it was the right thing to do. That part of Dan’s argument appeals to me — if there were some star contributors, whether of content or other effort, this is enough of a payout to share some of the wealth.
Legal As She Is Spoke, New York Law School’s legal journalism blog, weighs in on whether the unhappy and unpaid bloggers could win their case: http://www.lasisblog.com/2011/04/23/nobody-is-getting-paid-for-unpaid-blogging/