Another Print Publication Bites the Dust

Newsweek to move online:

“The transition to online from hard print will take place,” Diller said. “We’re examining all of our options.”

A plan to move Newsweek to an online-only publication will be announced as early as September, Diller said. Newsweek became part of his media holdings in 2011 when it merged with IAC’s Daily Beast Co., an online news startup that Diller started with former Vanity Fair editor Tina Brown. The merger was part of an agreement with the late Sidney Harman, who acquired Newsweek from Washington Post Co. for $1 and the assumption of liabilities.

And an older announcement From TalkingBizNews:

“Dow Jones & Co. plans to stop publishing the print version of SmartMoney, a personal finance magazine, although it will expand its digital platform, according to two people familiar with the matter, reports John Jannarone and William Launder of The Wall Street Journal.

Jannarone and Launder write, “Layoffs are expected, but the number of positions to be eliminated is unclear, one of these people said. An official announcement could come as soon as Thursday.”

The business models of these magazines (and many websites) is opposite of what it should be in today’s world.  Instead of having a bloated staff with tons of overhead like most magazines, a publication can outsource the content to the best all-star writers already writing.

Our old post on the theStreet.com below from December 2011 (since the post has vanished from my archives for some unknown reason):

There was news yesterday that an activist fund is getting more activist on TheStreet.com.  I had a good friend that thought about buying the company at one point (but I seem to remember some sort of poison pill or some weird structure that prevents it?).

It has always astounded me how TheStreet.com doesn’t make money.  And by that I mean make money hand over fist.  After all, they’ve had some pretty amazing writers over the years.  The usually have revenue in the ballpark of $30 mln or so per year, but as long as I can remember, have not ever really turned a profit.  The get most of their revenue from the premium offerings so I am not sure whey they litter their sites with Google ads promoting penny stocks.  It isn’t a major revenue driver and it kills your credibility.  You hold yourself out to be a great education resource but you’re touting retail currency trading and penny stocks?

Now, this isn’t just limited to TheStreet.com.  The lack of quality investment websites also floors me.  This has been a major opportunity for the past 10 years, but most sites simply follow the ‘vomit up as much content as possible and put as many Google ads on a page’ business model.  Most are simply low quality content farms, with some – and I’m not joking – having over 4000 writers.

I used to write for/get aggregated by a number of these sites before cutting ties with all of them many years ago.  Out of frustration, for a number of years I had considered launching a new site that would be focused on quality investment ideas and commentary.

The concept is so simple:  just choose the top 10-20 blogs and republish their best stories (with permission).  Create a place where the bloggers can interact with each other.  Do a monthly or bi-weekly magazine online that republishes the 10 best articles.  To the extent the authors offer premium services, let those be offered.  The top 20 blogs already control vast traffic, so they can form their own site, control their own destiny, and don’t need to partner with a non-rev generating partner.

Heavy emphasis on branding the story with the author’s blog with prominent links to their logo and site.  All of the bloggers will receive a share of the ad revenue from their content pages, as well as founding bloggers receiving equity in the parent company.

The fixes the high noise problem (too many bad writers), as well as the blogger problem (are not compensated at most sites, don’t want to be associated with low quality sites).

There would be very little editorial costs, perhaps a couple editors/tech hires in-house (but certainly not $30 mln worth of expense!).  I went as far as contacting a number of the best bloggers, and most were on board.  The problem for me is that it is not what I want to spend my time doing (that is research, writing, and money management).  So, if you want to run with this idea let me know.

Seems like a much better business model than what is currently out there.

 
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