Sorry Jason and Nick, There's No Money in Blogs

In his annual end-of-year “State of the Contentsphere” column in e-Content magazine Steve Smith posits that there will be no money in 2005 for pure-play blog companies like Weblogs Inc. or Gawker Media. Rather, he says, the real value blogs hold is for established media companies who use them to retain their existing audiences. Here’s the key part of Steve’s column (note the stats)…

Blog Bucks: The wild and wooly blogosphere itself will not make money for many, including blog networks like Gawker Media and Weblogs Inc. Nevertheless, blogs are already proving to be powerful audience retention devices for known media brands. Some B2B sites report that up to 10% of daily traffic now goes to columnist blogs. Blogging is less a business model than a thoroughly compelling communications model that keeps users coming back two and three times a day more effectively than standard content refreshes. Accept it and get sponsors for it.

Steve, I love your writing, but you’re just plain wrong here at least as far as the pure plays go. Pure play blog companies like Jason Calacanis’ Weblogs Inc. and Nick Denton’s Gawker Media are already attracting sponsors like Audi and are making money. Are they making a king’s ransom? No. But I bet in 2005 they will turn a profit if they haven’t already. You’re forgetting that they carry far lower overhead than what the big boys need to manage. More importantly, their blogs are equally if not more influential than the mainstream media. Just look at Wonkette’s power this year.

Comments

[Jim Kukral]

You're right on there. 2005 will be the year of the profitable blogging business model. I can feel it!

[Dave]

Steve,
Totally agree with you as a blogger for one of the above mentioned networks. With internet advertising as a whole set to explode in 2005 according to every industry "expert" out there, why wouldn't established, credible networks like these also make money through this increase in advertising? Especially as you say with the high rate of return visitors every day like we see on Autoblog?

[Darren Rowse]

totally agree with you Steve - I think many blogs will see exponential growth in the money that they are able to generate directly for their owners and writers. I know of a number of bloggers who in the last 2 months have gone full time into blogging having seen some genuine increases in their earnings from advertising, sponsors and affiliate programs. This is only the beginning....

[The One True b!X]

There does not appear, however, to be enough money to allow my own one-man, full-time weblog-as-journalism endeavor here in Portland alive past the end of December of this year.

So blanket statements one way or the other don't cut it. There's something about the nature of the specific sites that have a shot at "making it". Whatever that something is, a going-on-two-years weblog about local Portland politics (and related matters) doesn't appear to have it.

[Dave Austin]

Maybe Steve Smith is right about the prospects for new blog networks, but aren't Gawker and Weblogs Inc. already media brands? If they play their cards right they can grow their blog networks and perhaps expand into other media besides blogs.

[jake]

i have a feeling the blog networks will do fine. my hunch is that they will not be multi-million dollar businesses, but might provide a nice lifestyle for their owners, especially if they are built and run with a little bit of savvy. that would probably be enough for jason, but i think nick has his sites on bigger things.

[John]

Look for the next best thing and make your move. Make money fast. Make money online - http://web.ecomplanet.com/WEAL2336/