• Fri, Sep 30 2005

Blog Network Revenue Models

First it was Martin posing the question of whether or not blog networks are right for you, which was then followed up by Darren with commentary from Jason Calacanis. Martin emailed me a couple of days ago when he posted the entry and asked if I could offer my opinion. Well I checked back a little later and the conversation had exploded with thoughts from Jason Calacanis, Jeremy Wright and other blog network owners.

I read every comment and thought every single one was a good analysis of what a blog network should do with regards to paying their writers. People forget that Calacanis didn’t start WIN with $0 in the bank. The guy had money before so his ability to switch from a % share model to a straight pay model was much easier. Same reason why Denton could start with straight pay. It seems everyone else who starts a blog network doesn’t have that luxury and they are all just playing catch up.

Engadget and Gizmodo do over 40 entries a day. Do you think your blog network can keep up with that and get the scoop on the gadgets instead of just reposting what the two sites have already said? Probably not.

Joystiq receives over 94k visitors a day (Kotaku, it’s “rival”, doesn’t come close with 23k visitors a day). Joystiq posts more and they post the new stuff before Kotaku so they win plain and simple. How does another network compete? Maybe you don’t start a gadget blog or video game blog, but every network needs its own Heavyweight Champ. The one blog that gets recognized. If you start a network you better have that blog or at least have in your mind which blog that will be. For Fine Fools, of the original 7 my money is on Damn I’m Cute, but the traffic leader right now is I Like Cameras (those guys are killing it!) followed by It’s Useless and Insert 25.

So really should we be asking how writers in these networks should be getting paid? I don’t think so because you can find people to write for you in almost any model. The question you have to ask yourself is what type of model do you need to bring in the talent to help you succeed?

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  • http://rhysalexander.com Rhys

    Nice commentary, Scrivs. I especially like the last question you pose. You’re right; there seems to be a lot of ‘putting the cart ahead of the horse’ so to speak, in blog networking.

    There’s immediately so much talking and arguing about money/revenue, when the crucial question hasn’t been answered? How do we first INVENT the quality product we’re talking about selling?

    It’s obvious a lot of these networks are just flung together, as is obvious in some by the bad, dull writing, been-done-1000-times subjects, and in other networks, the sheer number of blogs they allow in. Too many, with no organization, and you may as well go back to google to find an interesting blog.

    There are always ways for writers to get paid doing SOMETHING. But to attract good writers, you need to create something they’ll be proud of joining. Then the revenue will naturaly speed up. What should make you notorius is not the amount of percentage you’re willing to pay your writers, but who can attract the best writers and brave new, exciting content. As a writer, I certainly know which one would be most important.

    This topic has really led to a lot of thought-provoking discussion, kudos to you for thinking this through.

  • http://digitaldoorwayblog.blogspot.com/ Marti

    I’ve been bouncing around this discussion with great interest. There are aspects of a network that sound very appealing. I imagine those who have joined are discovering positive and negative aspects.

    I wish I had seen commentary from someone who is blogging for a network, to get the view from the other side of the window. All of the comments have certainly been intriguing though, and appreciated.

    I’m curious what happens to those who join and fail to perform to the networks standard, whatever tht may be? I have clicked through several networks’”member sites” and find some who aren’t posting very often, or the posts are…well, dull LOL

    How will the underperformers be dealt with?

  • Scrivs

    Rhys: Exactly.

    Marti: Well with the 9rules Network for example we have writers who post with differetn frequencies. If we see a lull in their blog we talk to them to see what is going on. We don’t pressure them to produce more, but like to discuss why their blog isn’t meeting the standards that it met when they first replied. If this happens on more than one occassion then they are asked to leave.

    We have yet have this happen though.

  • http://www.wurk.net Barry Bell

    I know this post is focusing on revenue and payment for writers, but there’s another big factor that will swing a writer’s decision about whether to come and write for your network.

    Traffic.

    Ok, WIN and Gawker had the ready cash. But networks like b5media and Fine Fools had a ready supply of readers simply because of who’s behind the network. And I think that being *read*, is just as important a hook to writers as being paid. And in any case, a large readership is gonna (probably) lead to bigger revenue anyway.

    The difficult thing is building a network – and persuading writers to work with you – when you have no cash and no ready traffic.

    I think the only solution for network owners in this position is to offer the writers a bigger stake in the network in terms of revenue share. That way, writers can view it as not just another quick 100$ a month writing gig, but something they can start thinking about – and committing to – in the long term.

  • Scrivs

    I agree Barry and part of that traffic falls on the lap of the Heavyweight Champ that I referred to. I can get traffic to these sites, not a lot, but I am definitely not starting with zero. Same case with b5media.

    However, in the big scheme of things we both have small readerships and after those readers have checked out the sites either they will decide to stay or never come back again so our “power” is limited to the quality that we can produce.

    For Fine Fools it brings up an interesting situation where as time goes on and the blogs progress you are starting to look at 100% Google/Yahoo and already established traffic. However, if the blogs don’t succeed then the chance of getting more writers on board will be zero.

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  • http://www.worldcupcorner.com World Cup Corner

    I think it’s useles to compare networks between them because every network has its own bussines model and ever bussines model has some bad and some good points.

  • Scrivs

    I wouldn’t go that far. You should still compare and weigh the successes and failures of each model even though they only play a part in how well a network performs.

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  • http://rhysalexander.com Rhys

    True, there’s a saturation of networks, but there is NOT a saturation of quality networks, and it’s refreshing to see someone actually make a point of that. I’m curious, how do you all feel about limiting the # of blogs in the network…do you feel it raises credibility and quality? At what # of blogs do you feel a network moves away from selective quality and into ‘quantity/sweatshop’ territory?

  • http://www.yourwirelesshq.com/ Arun Kumar

    For someone who is fairly new to blogging, and thinking of starting a new network, attracting writers using either model is hard.

    It seems like the % share model is a good way to start, and then when you get a decent reader base, plus good traffic, you could amend the agreement to a straight pay model. Sustainability is the key, regardless of which model you go with.

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  • http://calacanis.weblogsinc.com Jason

    >> So really should we be asking how writers in
    >> these networks should be getting paid? I don’t
    >> think so because you can find people to write
    >> for you in almost any model. The question
    >> you have to ask yourself is what type of
    >> model do you need to bring in the talent
    >> to help you succeed?

    When we started we didn’t pay people… it was 100% revenue split. Most bloggers didn’t make anything for the first six months even though we gave them the first $500 in revenue before we did the split (I think that is what B5 is doing now too–it’s a good idea).

    We found that one out of 20 folks (5%) wanted to blog for a revenue share. Back then this was a small group of folks. Today, with 10M+ blogs being run by a couple of million bloggers, 5% might be a pool of tens of thousands of people (as opposed to two years ago when it was 100′s of people).

    So, I think you could find revenue-share motivated people.

    I could even see folks move between networks as their life needs change. Perhaps you need to get paid today and don’t care about owning your site or work… you might want to work with Gawker or WIN. A year later you might want to own your own site and just be part of something bigger like 9rules. You might even fall between those two options and might want to see if you can hit a homerun working with B5 and not owning your content and getting the value of unlimited upside (of couse, that is a HUGE risk right now).

    The real option isn’t between the networks frankly.

    The real option is doing it yourself with Google Adsense or doing it with a network.

    The networks all have to provide more value than doing it on your own.

  • http://www.wurk.net Barry Bell

    In that case, much of the value that the networks provide (in most cases) is that they take care of the hosting, the infrastructure, the software, the bandwidth, the admin, the design, the experimentation with ad placement, etc, etc, etc.

    All you need to do is write.

    There are plenty of non-tech minded bloggers and lots other writing talent out there who are new to blogging, and who don’t want to be screwing around with template tags, themes and adsense code – or they just don’t have the time. Yep, you could just use a standard blogger, wordpress or typepad template, but you’re just gonna look like everyone else who’s doing the same.

    Providing a good quality, reliable and ready-made infrastructure is where I think networks will have their most value in the next 12 months.

  • http://www.webmastertoolbag.com/weblog/ Lyndon

    I keep reading about the saturation point of blog networks and I completely disagree. We havn’t even scratched the surface yet. Go look at how many people use the internet. the regular browser does not know his arse from a blog. To him a blog is a website, end of. So are there too many websites? No, of course not. Are there too many sites publishing crap? Yes. But just because stuff is published in the form of a blog makes no difference and when I say it makes no difference I am talking the regular surfer, not bloggers who take up blogging with a ferocity akin to a starving tiger in a barrel full of monkies.

    Lets have more blog networks.

    Lets have more solitary bloggers teaming up with other solitary bloggers to form networks.

    Give the people what they want!

  • http://blogebrity.com/blog Nick Douglas

    Re: I Like Cameras beating out Damn I’m Cute:

    Told you so.

  • Scrivs

    I am talking long term here. Not after one week! And I have another writer joining up this week for the site so I think the tables will turn…

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  • http://rhysalexander.com Rhys

    Hmm…I don’t know…I have this strange feeling that Damn I’m Cute will reign supreme. It’s in the stars, baby.

  • Scrivs

    Word.

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