February 2, 2009

Doing the math on Pajamas Media.

"Roger Simon’s claim that the ad network lost money from day one is the result of extremely poor business decisions, and that all they had to do to make it work was tell their bloggers the truth and simply renegotiate CPM rates."

***

"The fact of the matter is, these righty bloggers were kept financially afloat by PJM in an attempt to institutionalize the wingnut blogosphere as an alternative to the perceived liberal MSM. Given the American people's distaste for conservatism as practiced by George W. Bush (which can be argued was a perversion of it) and desire for change, the money wasn't there because no one cared about what these bloggers had to say or was willing to pay them to say it in this climate."

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And here, Roy has fun surveying the rightosphere reaction.

31 comments:

MayBee said...

No blog is terribly transparent about the source of its financial support.
Especially the bloggers that seem to make a living by blogging. At least Pajamas Media bloggers let us know they were part of this group called Pajamas Media.

Lem said...

Wait.. First it was that Pajama's did not pay well and now it's that they paid too much?

Which is it?

Balfegor said...

"Roger Simon’s claim that the ad network lost money from day one is the result of extremely poor business decisions, and that all they had to do to make it work was tell their bloggers the truth and simply renegotiate CPM rates."

I find this a little dubious, given that basically all written media seem to have had a pretty bad time of it these past few years -- it's not limited to these blogs by any means. The Tribune Company filed for bankruptcy back in December, after all, and if it weren't for Mexican plutocrat Carlos Slim, the New York Times would probably be in the same boat. As far as similarly ideological media go, Air America went bankrupt at the end of 2006, although they have since been purchased.

It's possible that better decision-making could have saved them, but I'm a little dubious -- everyone seems to be losing money in journalism and commentary right now.

MayBee said...

Amazon.com opened for business online in 1995.
It turned its first profit in Q4 of 2002.

Not turning a profit from day 1 is not always the result of poor business decisions, and is not always indicative of them.

AlphaLiberal said...

The Tribune Company filed for bankruptcy back in December...

Related to being over-leveraged by Sam Zell. As I understand, most papers make money, if on small margins. but operators like Zell have buried them in debt they can't pay off.

And there are success stories out there.

Pajamas Media has proven that there is a small market for reality-challenged bloviators. Thanks for that.

Chris Wren said...

Part of the problem - the biggest part - might be that the demographic that's interested in blogs, political opinion and news from traditional media sources is in decline. Generation Y generally chooses Digg over Drudge and social networks over blogs. The audience for things like Pajamas Media, Huffpo, Firedoglake, Salon, Gawker Media etc. is what advertisers call a classic "shrinking raft". We'll see more such failures this year all over the ideological spectrum.

Jana said...

If a lefty venture like PJM existed (by that I mean, one that isn't bankrolled by zillionaires with little better to do than throw money at their pet causes -- see: George Soros) it would probably go belly-up as well. Tigerhawk did a decent post-mortem on this, and as much as lefties would like to believe that they've found a better way to monetize the web, they're wrong. They just found deeper pockets.

As for the bloggers that are throwing a fit (see: Protein Wisdom, who I like), blogging part-time as opposed to full-time is not a death sentence, and some do it quite well, as our Althouse proves daily. They need to pull it together and get creative if they want to stay viable.

Christy said...

Anybody know if Huffington is making money? Does Daily Kos? How do their business models work?

traditionalguy said...

To my surprise I find myself in agreement with Alpha Liberal. Being "a reality challenged bloviator" is just as boring from the Right Wing as it is when coming from the Left Wing. A good presentation helps, like Reagan's or Palin's, or Obama's. But the rote repetition of Our Sides Views leaves me looking around for more pretty Quickly. Tell me more than one side of human experience, and then you keep my attention.

Theo Boehm said...

Chris Wren makes a good point about the audience for blog-based material.

My 14-year-old started and ran his own successful WordPress blog for about a year.

I was amazed. It was well-written, had cool graphics, and was getting 12,000 hits a day—along with flame wars in the comments and other headaches.

He dropped it suddenly a few months ago.

"Why?" I asked.

"Blogs are for old people, like you!" he assured me.

He then went on to tell me about all the new, cool stuff on the web.

LonewackoDotCom said...

Maybe Althouse could use her connections to find out why my open letter to various PJM bloggers - including Insty - was ignored.

If, instead of mind-numbingly-stupid talking head shows, they had done that they would have had a) greatly increased traffic and mindshare, b) made the MSM look very bad, and c) had an impact on the election.

Instead, all they did was moan in the corner. Why was that?

AlphaLiberal said...

Utes these days. who can understand them?

So the future is Twitter? or is Twitter just for twits?

Any actual numbers behind the "shrinking raft" view? Seems to me that traffic set record levels during the campaign. That all campaigns must end might be part of PJM's difficulties as well.

Ad-based ventures also seem to be hurting all over the map. But I see TPM expanding, adding reporters and constantly losing same to the most prestigious news outfits around.

I laugh every time a conservative claims George Soros is behind something. Not so much. (And, PJM has also been bankrolled by a sugar Daddy, along with the Washington Times (Rev Sun Myung Moon), National Journal, etc, etc.)

Beth said...

Generation Y generally chooses Digg over Drudge and social networks over blogs.

I'm just figuring this out. In my freshman comp class, where the students range from 17 to early 20s (with a few older students, but not many), they have no real clue what a blog is. They think of livejournals and facebook and myspace.

I had planned to show them some various political, techno and interest blogs, including some good local bloggers, but now I'm reconsidering it. And it raises the question for me as someone dealing with composition and rhetoric whether it's worthwhile at all to include current media in my syllabus.

Leland said...

I guess it is just me, but I rarely read articles on PJM's website. This included those written by bloggers I read regularly. The reason was simple, each article seemed to be a long essay. Good blogs are pithy.

PJM followed the MSM 2 page web format for advertising. I'm sorry, but few stories get that much attention from me. The only thing I really appreciated about PJM is the greater amount of material from Bill Whittle. Otherwise, PJM simply provided an excess of stuff I could get elsewhere.

tim maguire said...

Any of you people with connections to what the kids are doing these days: do these new fangled watchamacallits offer an alternative to the various blogs for news and commentary? Or do the kids simply not give a crap about news and commentary?

There's probably a Wiki out there that covers this.

Donna B. said...

I'm having a lot more fun blogging now that I'm not even trying to 'monetize' it. I hate that word.

Facebook is fun for me because almost all my friends on it are people I actually know. Most of them, I'm related to and I love the little updates I wouldn't otherwise get.

Simon said...

tim maguire said...
"Any of you people with connections to what the kids are doing these days: ... do the kids simply not give a crap about news and commentary?"

My sense is that the kids simply do not give a crap about anything except themselves, writing this incredibly poor sub-pidgin dialect, and hooking up with as many of their classmates as possible (presumably the one with the most diseases by the end of high school wins). I've really come to think that SMS and these social networking sites are up there with VX Gas and Barney on the list of things I wish the human race had never invented - their minor utility is hugely outweighed by their corrupting effect.

1jpb said...

instead of mind-numbingly-stupid talking head shows

More like this!

Chris Wren said...

"My sense is that the kids simply do not give a crap about anything except themselves"

Well, it's not all that bad. One thing I do notice from the perspective of a business owner is a lot of young people investing really huge amounts of time and energy in social networking under the assumption it's just going to somehow magically pay off in terms of getting work and career advancement. Of course, the world doesn't change just because young people adopt something in huge numbers. Employers are still interested in seeing a list of solid accomplishments - and managing your presence on a couple of dozen or more social sites isn't one of them. I don't know where they learned that from. Did we teach them that?

Revenant said...

If conservative media are doomed by the Americans' alleged distaste for conservative viewpoints, why is Fox News doing so well? Is it not conservative after all?

I think Balfegor's right. You don't have to invoke ideology to explain why PJM blogging failed. Most media outlets are doing badly, and most new business enterprises fail.

Revenant said...

One thing I do notice from the perspective of a business owner is a lot of young people investing really huge amounts of time and energy in social networking under the assumption it's just going to somehow magically pay off in terms of getting work and career advancement.

Is that really such a wild assumption for them to make? Social contacts are the #1 way to get a job.

Whenever we're thinking of hiring, the word always goes out: anyone know somebody looking for work? Those people usually get interviewed first. They're safer hires. Sure, some people might mention their idiot friend for a job, but (a) the guy still needs to survive the interview and resume check and (b) most people don't want to work with an idiot, even if he IS their friend. Plus, everyone will remember "jeez, I can't believe Fred recommended this dolt".

I've had ten jobs, full and part time. For nine of them, I got an interview (or was headhunted) because of social networking -- friends, ex-coworkers, or friends of friends/coworkers worked there already. My actual college classes did a hell of a lot less for my career than the people I *met* at college did, especially since my degree wasn't a perfect match for my chosen career. :)

TitusCoffeeShopLove said...

I work in HR and had a very high level strategic meeting with our Ad Agency last week regarding "Finding Top Talent".

The news delivered by the Ad Agency is 70% of candidates are now on Social Networking Sites to find jobs. Twitter, Facebook, Linkedin, Yahoo Groups, Google Groups. This is the 21-40 range age group, but older demographics are also moving in this direction.

Monster, Hotjobs and older job sites are dead.

Today it is all about getting information on a handheld.

Eli Blake said...

I question the whole idea of 'institutionalizing' blogging in the first place.

I blog because it's fun and exciting.

I use blogger because it's free, and I haven't even installed a counter on my own blog (because if nobody reads it, I don't care.) I was invited to start posting on a more widely read team blog that does have a counter, but I do that for fun too, and any revenue generated goes to the blog host.

What PJM didn't get is that the blogosphere is about the free and unfettered exchange of ideas, and you can't put a harness on that and expect it to work as well.

nathan said...

work for free because you believe in what you have to say

ask govt for bailout--socialism is fun!

demand tax cuts, the answer to all money problems

TMink said...

While I am interested that PJM had some troubles, the blog you linked to is a losing proposition! There is no reason to refer to that blog again as far as I can see. Anyone that refers to Instapundit as a right wing nutjob has reality testing issues.

Trey

Paddy O. said...

Blogs are still, as I see it, quite important and useful. The big change isn't due to blogs becoming irrelevant. The big change is blogs no longer being the sole way to express yourself online.

It's not the blogs that are interacting with news or spirituality or other important topics that have lost their usefulness. It's all the blogs that were little more than random expressions of daily life, mostly vacuous and uninteresting except for those in the bloggers immediate circle. That these probably were, for a while, the great majority of blogs means that it might seem blogging has seen better days.

Those kinds of blogs are irrelevant with Facebook and Twitter. Because those kinds of blogs didn't say anything more than a status update or short blurb anyway.

Blogs are still a great way to sketch out thoughts through writing and to piece together a perspective on this world. If others enjoy reading all the better.

Ann Althouse said...

Eli: "What PJM didn't get is that the blogosphere is about the free and unfettered exchange of ideas, and you can't put a harness on that and expect it to work as well."

LOL. That's pretty much what I said to Roger L. Simon that time he hung up on me.

Eric said...

Anybody know if Huffington is making money? Does Daily Kos? How do their business models work?

I saw a newspaper article on Kos about a year ago. Yeah, he makes tons of money (they had a figure - I just don't remember what it was. Somewhere in the six figures). Which you would expect given the number of hits he gets.

The fact that Pajamas Media didn't make it is really no indication of incompetence. Simon says PJM subsidized rates expecting to be able to sell the slots and it didn't happen. Maybe it's the economy, maybe the price points weren't right. Maybe he didn't have the right connections with advertisers.

Microsoft lost money on the XBox for, what, a decade before it turned a profit? Maybe PJM would have worked if there was more capital - seven million bucks wouldn't buy the art in a bank CEO's office.

AlphaLiberal said...

Want to have some fun sometime? Look up your nephews, nieces et al on Myspace et al. And then tell them you did so.

The horror on their faces! (Newsflash, kids! It's PUBLIC!)

Of course, you might learn things you wish you never knew....

TMink said...

Alpha, you are totally correct! I have my eldest daughter's password, so this keeps her thinking about privacy and safety issues, cause she knows I will talk to her about it.

Trey

Mr. Smarterthanyou said...

PJM had a bunch of liberal twerps like Ruben Navarro writing and about half of the "conservative" columns were from what the left calls "neo-cons"; liberal jews who finally decided to become hawkish after 9/11/01. PJM was starting to look more and more like a MSM website.