The Huffington Post Deathwatch…
This writer (very slightly) knew Arianna Huffington a long time ago when she was … a Newt Gingrich Acolyte. Then Newt’s political star fell and she … reinvented herself. (She wouldn’t remember me; she is perhaps the virtuoso social climber of our generation and I was — and remain — far too small a potato to be of any possible interest to her.) That was back in the days when she was launching the anti-MoveOn.org, Resignation.com, calling for Bill Clinton to resign…. Times change….
Slightly later, I happened to attend a presentation that she made in the process of reinventing herself, around her book The Fourth Instinct, handsomely blurbled by Deepak Chopra, describing “the dead ends we are led down when we are obsessed by the pursuit of success, wealth, and recognition.” If memory serves, it was about her making us as spiritually evolved and noble as she so that she could save the Planet. Leaving her lecture, slightly bewildered, it was mildly disconcerting to find a stretch limousine idling out back by all appearances waiting for her and her very stylish entourage (and spewing CO2 out back while idling during her lecture, kind of like Al Gore’s private jet).
Am not the judgmental sort, but — if it WAS her limo — there seems to be some inconsistency between her talk and her walk. Or her ride….
Notwithstanding her critique of the pursuit of success, wealth and recognition, a little less than a year ago Arianna picked up $25 million, mostly, or all, from one presumably star-struck investor, Fred Harman at a rumored $100M implicit market valuation.
There are those who believe that Arianna sprinkled fairy dust into Fred’s eyes to make him believe that it was a great business proposition, not a vanity/propaganda organ that will never pick up enough cash to cover its burn rate. It’s not a business and never will be.
Why won’t it? Because most advertisers hate controversial content. The October 15 HuffPo displayed two modest space ads on its splashpage — both from Adobe, which appears to be buying everything in sight at the moment and so likely ended up there by accident of ad syndication.
And the Po is totally out of the game in the great Facebook/Google War — not only in terms of scale but in terms of the business model. In Facebook’s case it is relying on user-managed metadata; in the big G’s case, relying on anonymous browsing history. Both are smartly spending billions in an effort to get control of the Big Enchilada: the $50B/year of display, rather than classified, advertising. When they get that right… farewell forever Time and Newsweek. Gosh how you’ll be missed! No more Barack Obama covers peering out at us from the newsstand. (Can the Republic survive that? Time for another Bailout?)
Spending a billion a year on YouTube is very smart if it gives you a shot at dominating the big $50B/yr display ad market. Sergei, Larry and Eric are nobody’s fools.
HuffPo isn’t even an asterisk in that game.
The evidence that can be gleaned is that Arianna and her gang of 100 acolytes that “staff” the Po have a burn rate of maybe $1M/month, giving the Po about a 24 month shelf life (from last December, giving them about a year to live … unless they get a new cash infusion).
The Po was funded, as a business, by a venture capitalist. Not an advocacy site like Center for American Progress. There is zero evidence that the Po is generating, or capable of ever generating anything like $12M a year. (Just a guess, but … where are the ads???)
Nor is there much evidence that the Po has anything like the political clout of populist bootstrap webspaces like the much less expensive, feisty, DailyKos or the really, really smart Personal Democracy Forum. The Po — except for the rare columns by Esther Dyson and a few others — not only is journalistically shoddy — parajournalism, really — but is consistently guilty of the most unforgivable crime on the Web.
It’s completely predictable and boring: Mad Magazine for Liberals.
The Po is a grotesquely expensive version of Slate.com, Salon.com and, well, Parcbench.com.
Slate, apparently read exclusively by aging yuppies who still think Doonesbury is humorous, is owned by The Washington Post, a money-hemorrhaging division of Kaplan Test Preparation. Kaplan, Inc. (2008 revenues: $2.3 billion) is kind of to the WaPo what the Messianic Rev. Moon is to The Washington Times (or Fred to Arianna). While Slate’s financials are therefore obscure obviously it would be humiliating to Katharine Weymouth if Slate were not incurring solid 7-digit annual, if not monthly, losses.
Salon is the most, well candidly the only, interesting left of center pixeltabloid — offering transfixing articles by great writers such as Camille Paglia. It has a staff maybe half the size of HuffPo and actually seems to be losing only about $1 million a quarter.
(Note to self, review the money-losing HuffPo/Slate/Salon editorial policies on the federal deficit for a possible future article….)
And Parcbench? (Full disclosure, I write for it. Duh! Fuller disclosure: it doesn’t pay its contributors, we write for Glory, hopefully that will change some day.) Parcbench rapidly seems to be becoming the Salon.com of the Right. It manages to grow by incurring an operating deficit estimated by one knowledgeable observer (me) of a few thousand dollars a year, putting out a consistently more interesting product than either HuffPo or Slate. (Sorry guys, Salon still is way better than you. Start paying your contributors, and hire Joan Walsh away from Salon, and get back to me.)
So Fred? (Or anybody!) If you are looking to invest in a cool online mag odds are you can get a big chunk of Parcbench stock for a LOT less than $25 million! Less than $2.5 million! Less than $1 million! Oh the Glory!
Now, hemorrhaging cash without Kaplan, Inc. to subsidize them indefinitely, well, nobody really knows but it’s entirely possible that the HuffPo is the Left’s equivalent of FreedomsWatch.com or the catastrophically expensive failed effort to create Newt TV a while ago.
So this writer, who tweets as The Webster, has started the HuffPo Deathwatch and considers the Po likely to collapse in 2011. Hasn’t found anyone to take the other side of the celebrity death bingo bet and pony up some stakes on a bet that the Po will survive.
Perhaps the Po will be rescued and downsized, and the corpse propped up by some elitist sugar daddy. Especially since a lot of elitist sugar daddies can’t tell a successful webmag from a blog. On the other hand, it is not unlikely that the decision about whether, and how much, to fund the Po will fall to John Podesta, president of the Center for American Progress (former Clinton White House chief of staff, and co-chair of the Obama transition team). Podesta seems to have the ear of pretty much all the progressive billionaires in the Universe about where their money should go. Hard to envision him steering serious cash to the divine Arianna’s vanity ‘zine…
Don’t mourn for Fred Harman. He’s a genius and seriously rich and can write off a stupid investment in “parajournalism” as an anomaly for him. Let us hope that when the Po has burned through all of Fred’s lovely money he, or some other bored billionaire, does in fact prop it up.
Because if the Po collapses there’s some risk that Arianna will reinvent herself again. And really, Arianna, however splendid and glittering your soirees? There are not a whole lot of people just waiting to invite you to our Tea Parties…. And we’re really not very glittery, you’re not really our type.
Ralph Benko, who served as co-emcee of the July 4th Boston Tea Party, is a principal of Capital City Partners, of Washington DC. He is the author of The Websters’ Dictionary: How to Use the Web to Transform the World for policy and advocacy groups to use the Web powerfully. It is available as a free eBook from www.thewebstersdictionary.com and in book form from Amazon.com and finer bookstores everywhere.