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The Almighty Buck

Salon, Nearly No Money and Ultramercials 441

Posted by Hemos
from the coming-soon-to-a-tv-near-you dept.
Adam9 writes "As Salon fights for survival, they have introduced a new advertising program that allows you to receive a free 12 hour pass by clicking through about 10 seconds of advertisements. Currently, the advertisements are from Mercedes-Benz. According to the article, they've lost about $79.7 million from their start in 1995. They also have about 45,000 subscribers right now." Jamie also pointed out this article from the WSJ, as well as the words from Salon themselves about it.

Salon, Nearly No Money and Ultramercials

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  • Anyone know (Score:3, Interesting)

    by digitalsushi (137809) <slashdot@digitalsushi.com> on Wednesday November 20, 2002 @03:05PM (#4717466) Journal
    how many subscribers there are to slashdot?
    • by Anonymous Coward on Wednesday November 20, 2002 @03:11PM (#4717528)
      Overheard from irc.slashnet.org:

      slyguy^: How many paying subscribers are there to Slashdot?
      Hemos: 12. After we split it all up, I got a #4 combo at Taco Bell. ;)
      • Damn, dude got more then I did. I was hoping at least to get a seven layer burrito.
  • by NineNine (235196) on Wednesday November 20, 2002 @03:07PM (#4717494)
    If they're getting paid per click, then generally advertisers don't pay for forced clicks, ie: I'm clicking this because I have to, not because I'm genuinely interested in their product. At least in the adult industry, this is a *big* no-no unless you accept a *much* smaller pay rate (generally called 'blind' clicks). I don't know how it'll fly with their advertisers.
    • by grahamsz (150076) on Wednesday November 20, 2002 @03:17PM (#4717580) Homepage Journal
      It's clearly inline with their advertisers wishes.

      The advert i saw the other day from mercedes benz was clearly designed to be exactly that sort of click through. It had 4 pages of very flash oriented adverts for some new car.

      I must admit it was quite effective, and if i had the money to buy a mercedes then the ad might have effected me.

      If it were better targetted and perhaps extolled the benifits of red bull and coding sessions then i might have gone for it.
    • by SirSlud (67381) on Wednesday November 20, 2002 @03:18PM (#4717596) Homepage
      Which is exactly why CPC (cost per click) aint as popular as it used to be.

      CPM (cost per thousand) is the defacto standard.

      Furthurmore, most ads dont have anything to offer beyond the clickthru. Internet advertising is primarily a branding medium .. getting the customer to click thru isnt as important to the advertiser as youd like to think. (Although, granted, with aquisition campaigns, usually hybrid deals rear their ugly heads .. like CPM with a little Cost Per Action thrown in .. or sometimes its _just_ CPA.)

      Actually _seeing_ the ad for longer than 2 seconds is. (Salon isnt forcing you to click, they're forcing you to watch .. they force the impression out of you, which is actually _good_ for the advertiser.)

      I know these things because I write the ad delivery server for a company that has about 10% online penetration (one in ten americans online have 'hit' my ad server at some point.)
    • Why would they complain? We are forced to watch movie trailers and other commercials before a movie at risk of getting good seats. Heck, using AOL moviephone uses those stupid commercials.
  • by craenor (623901) on Wednesday November 20, 2002 @03:10PM (#4717520) Homepage
    Tasteful banner ads for online porn! Afterall, it's still the online money making king.
  • Micropayments (Score:4, Interesting)

    by gengee (124713) <gengis@hawaii.rr.com> on Wednesday November 20, 2002 @03:10PM (#4717525)
    If Salon has decided to take this route, why not allow micropayments? I don't have a subscription to Salon, because I don't read it very often. But I do sometimes find 'premium' stories I'd like to read...Just not enough to get a subscription. If I could pay 25 cents or whatever to read the story, I gladly would.

    I realize there are problems with accepting micropayments via credit card, but certainly something like PayPal could be used.
    • Re:Micropayments (Score:3, Interesting)

      by Anonymous Coward
      a company called Liquify [liquify.com] is trying to sell that to companies.
    • Re:Micropayments (Score:4, Interesting)

      by jhines0042 (184217) on Wednesday November 20, 2002 @03:19PM (#4717606) Journal
      Micropayments could work this way: You initally deposit $25 into your account and then you micropay... when your $25 gets low, you are automatically charged (on your credit card) for an additional $25.

      There are toll roads that operate this way.

      • by beq (458372)
        FWIW, That's exactly how First Virtual worked. Geez, do I feel old.

        "When I was your age we had to carry our packets with our bare hands to the router...It was 5 miles, in the snow, uphill!*cough*"
      • How do those of use who will probably never use up the $25 keep from getting screwed? If I go to a site once it doesn't mean I'll keep coming. I'm effectively making $25 deposits on all these sites I may or may not ever use again. I hope they give refunds when I close the account.
    • but then I started to really pay attention to the content and actively mine the past articles. they have some really good and thought-provoking stuff. it really is unlike a lot of the more traditional news sources like new york times and washington post. there are articles on the left and right equally. as an independent, I found it refreshing enough to subscribe. and now I spend a lot more time reading material that I don't seem to find anywhere else.
    • Re:Micropayments (Score:2, Informative)

      by beq (458372)
      Unfortunately, PayPal charges a minimum of 0.7% + $0.30, and that rate requires use of a Paypal debit card. The problem with micropayments continues to be that it's hard to make money off such small transactions until there are millions of them. I still have fond memories of "First Virtual". They were one of the first online payment services, and they aimed squarely at micropayments. Unfortunately there wasn't enough money in it, and they went under.

      A working micropayment system would solve a lot of problems in a lot of industries.
  • by beq (458372) on Wednesday November 20, 2002 @03:11PM (#4717532)
    It's an interesting idea, a "temporary subscription" in return for viewing some advertising. It seems there's something for everyone. The advertiser gets a forum where people actually have to click through the ad; Salon gets some money from the advertiser; and non-subscribers get access to "premium" content. If this works (and Salon stays in business in part because of this), perhaps other content sites will follow suit.

    • Salon is a quality site, with the sort of quality journalism that can probably command fairly good advertisers and their money. (as can be seen by the calibre of ads on their site).

      Their site plainly appeals to more educated and probably more wealthy individuals and i am of the opinion that this advertising method will not work for many other sites.

  • by Skyshadow (508) on Wednesday November 20, 2002 @03:12PM (#4717546) Homepage
    It's too bad to see Salon go -- they have genuinely interesting features on occassion. That said, I don't see how they ever really planned on surviving once the dot-com meltdown occurred. Selling the ability to opt-out of annoying ads just didn't cut it, especially given their level of overhead (big-name writers and the like). If Suck couldn't keep its head above water, Salon was always doomed. Still, it'll suck to have the only real webzine be Slate.
  • by djembe2k (604598) on Wednesday November 20, 2002 @03:13PM (#4717548)
    Look, I love Salon, and I'll really hate to see them go if it comes to that. But I don't see how they accumulated a debt of $80,000,000. They aren't in retail, so it isn't inventory. They didn't have to do years of unprofitable R&D to develop some sort of magical intellectual property that would pay off later. They are a web site. What am I missing?

    Now they have a solid base of advertisers and 45,000 paying subscribers, which is really good for an online magazine. The WSJ article says they are looking at a strategy of reducing costs. Sounds like a plan to me. Is it really conceivable that they can't find a way to keep costs within expected revenues?

    • what you're missing (Score:3, Informative)

      by Anonymous Coward
      what you're missing is that it takes money to run a magazine... *real* journalists, *real* reporters, etc.

      it took USA Today 5 YEARS to become profitable, and it was still only because they were bought out by a huge megamedia company.
      • They really went about it the wrong way. For example: There's this one geek news site that seems to be successful winthout any real journalists, real reporters, or even real editors.

        • by dubl-u (51156)
          You're missing the point.

          Slashdot works fine when somebody is already writing about the topic of interest and is willing to give their material away for "free" (meaning free or with ads).

          Salon (and every other decent magazine) pays people to write new material. Sure, they have stuff from an AP feed, but I can get an AP feed anywhere. What I'm buying with my subscription to Salon (or, say, The Economist) is that new material.

          That material costs money to produce and more money to edit. That money has to get to the writers and editors somehow. How would you suggest?
    • by indiigo (121714) on Wednesday November 20, 2002 @03:27PM (#4717669) Homepage

      Amazing what about 10 seconds of searching, a "financial" link, and a browser, will provide you.
      • That's nice, too bad it takes 2 hours to wade through the quarterly reports, doublespeak, and doctered numbers.

        Can anyone make basic sense of this?
    • by wiredog (43288) on Wednesday November 20, 2002 @03:28PM (#4717675) Journal
      Over 7 years. They are more than a web site, they are an online magazine. With a staff, and reporters, that need to be paid. Also, they have hardware costs to consider. They probably upgrade the servers, routers, etc every two to three years. Federal, State, and local taxes. Rent for the offices.
    • They produce the content of a weekly magazine every day. This is why they lose so much money. Even terrific magazines with 100s of 1000s of subscribers like the New Yorker lose money, I don't see why Salon would expect to profit.
    • Hrm... rent, salaries, bandwidth, renting the office.. all big debt accumulators if you ask me.
      • $80 million.
        $80, 000, 000 !

        1. I could see $1e6/yr for staff (ok, so they're probably terribly overstaffed!)
        2. Toss in another $1,000,000/yr for facilites.
        3. x (what, like, ) 7 years.
        4. = $66 million PROFIT!

        If these guys actually burned through $80, 000, 000 , they're doing something wrong! (of course there was a lot of that going around in the 90's!)
        I don't even know what I'm doing, and I'm confident I could put together the equivalent for much less than that. The only difficulty would be getting the "A list" talent, and I'm not so sure that what they have is really that special.
        • Check their annual report:

          Operating expenses:

          Production, content and product: $9.8M(2001) $10.1M(2000)

          Sales and marketing: $7.1M(2001) $15.5M(2000)

          For those counting, that's over $42 MILLION in operating expenses JUST between production, sales, and marketing in JUST the past two fiscal years. Looks like to me someone's spending too much on advertising and IT support... (or they have the most overpaid writers in the world)

          • Those don't look out of line to me. With 35 or 40 people on staff it wouldn't be unusual pay at all; they need artists, web designers, programmers, sys admins, and most importantly writers and editors. Throw in a CEO, a CTO, and two or three managers (operations, content, marketing) and you'll get to $9M very quickly.

            The sales figures are slightly disappointing actually. Ideally you would like to see sales and marketing costs increasing year over year since a majority of those costs probably stem from paid commissions. The implication is that they lost more than half of their sales revenues last year.

    • by poot_rootbeer (188613) on Wednesday November 20, 2002 @03:38PM (#4717772)
      They are a web site. What am I missing?

      It's the fact that web sites have to have content.

      And Salon has a LOT of unique content, meaning writers and editors who all deserve to get paid.
    • by Didion Sprague (615213) on Wednesday November 20, 2002 @03:40PM (#4717788)
      My question -- similar to yours, I think is this -- do deadtree magazines rack up similar debt?

      In other words, is the absence of paper -- and a physical object -- less profitable than if you do what Salon is doing and go 100% electronic?

      I seem to remember that Slate.com tried the deadtree thing -- along with their website -- and I remember that the Slate magazine was available in Starbucks. I actually *liked* the magazine -- as opposed to the annoying site (with its reader letters back and forth -- which strike me as the absolute height of pomposity and "in-joke-ness". If you just try to browse Slate, you're hit with all these things referencing other things -- and if you don't know what the "Fray" is and if you haven't been following all the oh-so-elegantly written missives between experts, you're lost. Salon *isn't* this way -- thank god. So I'm digressing, but everytime I think of Salon, I think of Slate and how annoying it is. Michael Kinsley is (was?) bad enough, but now that he's departed, the whiff of pomposity is still there.)

      Anyway, I know Salon at one time had some pretty good writers writing for it. I was always fond of Camille Paglia's stuff. But apparently they shit-canned her and a bunch of other writers a year (two years?) ago. Hasn't been the same since.
      • by Mignon (34109) <satan@programmer.net> on Wednesday November 20, 2002 @04:28PM (#4718248)

        That (hot grits) sounds (goatse) familiar (beowulf). Where (karma whore) have (first post!) I (Natalie Portman) seen (/. effect) that (anonymous coward) before? (troll)

    • by NewtonsLaw (409638) on Wednesday November 20, 2002 @09:26PM (#4720450)
      I know full well how publishers (and other online enterprises) can lose so much money.

      Back in 1997 I started a little website at 7am.com [7am.com].

      It wasn't pretentious and simply sought to become a news aggregation site designed to save people time by bringing together links to the most interesting stories from all around the Web.

      About this time I'd also just finished co-writing a book on Java (being a programmer from way-back) and it occured to me that I could syndicate my regularly updated list of headlines and links using Java-based news ticker.

      Thus an empire was born!

      Within a few short months, 7am.com had gone from getting just a few hundred hits a day, to getting half a million or so.

      The News Ticker was a smart idea -- it allowed people to include regularly updated, topical information on their web-pages at no cost or effort.

      Within a few short years there were over 200,000 third-party web-pages carrying the 7am.com news ticker and it was being hit around 2 million times per day.

      By that time I'd also started publishing a "newswire" consisting of stories written by myself and a small group of other writers who were keen to get some experience in the (then) new and exciting world of online journalism.

      Probably not a lot of people are aware, but 7am.com was (to the best of my knowledge) the very first website in the world to carry the pictures sent back from the surface of Mars by the Pathfinder mission in 1997. 7am.com beat NASA, CNN and all the other sites I checked by several minutes and -- thanks to the News Ticker's ability to "get the message out" to a heap of other sites, there were over 100K visitors within the first half hour of those images being posted.

      The exact details of how this "scoop" was achieved is revealed in an upcoming book I'm writing.

      7am.com also scooped most of the traditional media when NATO launched its attacks on Serb targets in Yugoslavia. One of our newshounds lived near an airport from which the B-52's were despatched and he filed a report within a minute or so of the first wave taking off.

      The same thing happened in 1998 when the US and Britain attacked Iraq -- 7am.com got the news up first.

      7am.com got the full Starr Report on Clinton's "misbehavior" online before many of the other news sites -- but we were smart enough to ZIP up our copy so that people could download it more quickly.

      Our ability to scoop big (and small) stories like this, combined with the viral growth of our news ticker meant that 7am.com was ranked by NetRatings (now Neilsen/Net Ratings) as being more popular than Playboy.com, The BBC's news website, and right up there alongside FoxNews.

      So why have I typed all this stuff?

      Well here's the bottom line...

      Until mid 1999, 7am.com was doing all this on a monthly budget of around US$7,000.

      That's right -- the total cost of running what was, at the time, the world's most widely syndicated web-based news service, was just $84,000 a year. What's more -- there were months when revenues almost covered those costs so the actual operating loss was significantly less.

      How was this achieved?

      Simple -- 7am.com was a true "virtual newsroom" which took full advantage of the power the Net offers to slash overheads.

      Although the webservers were located in San Diego, California, the "head office" of 7am.com was a tiny home-office in the New Zealand countryside, 10,000 miles away.

      Total staff consisted of myself and two or three other part-time freelancers.

      No Porsches in the carpark (no carpark!), no flash offices, no boozy lunches, no scooters in the hallway -- just a small group of people working their asses off and breaking some important new ground.

      I have to admit that I worked 18 hours a day for four years without a single day off. In fact, I got an ear infection and had the rather unpleasant experience of my eardrum bursting because I was too busy to get to the doctor in time -- but hey, it's only pain eh?

      About that time a group of VCs came along and said "we can take this business to the US and make a fortune". They promptly bought a majority stake in the business and set about "preparing it for sale".

      Now remember, this was a business that had run very successfully on a shoestring budget for nearly four years and had built the largest syndication network of its type on the Net.

      It had a very successful structure and operating model -- hell, it was even gearing up to make a profit!

      Unfortunately, things changed dramatically once the VCs got their hands on the controls.

      Suddenly the total outgoings jumped from $7K per month to nearer $120K per month. Offices were hired, staff recruited, new computers purchased, etc, etc, etc.

      Suddenly seven figure sums were being consumed -- and, what's worse, the carefully crafted, and very successful publishing systems which had been put in place were being overhauled (ie: screwed around with) despite my objections.

      To cut a long story short (buy the book if you want details ;-), the money-hungry VCs effectively bloated the operational costs by a huge sum.

      Phrases such as "you've got to spend money to make money" and "image is important" were bandied about freely.

      I was told that nobody would be interested in investing in, or buying 7am.com if it didn't have "substance". The "virtual" concept had to be replaced by lots of people huddled in little cubicles it seemed.

      My suggestions that surely profit was more important than "image" fell on deaf ears (perhaps I was once again ahead of my time eh? :-)

      The VCs ended up totally screwing the sale of the company, I got so frustrated I resigned, and now 7am.com continues to "chug along" but seems to have totally lost the spark, innovation and cutting-edge attitude that won it such success when the money-barons weren't in control.

      By the way, I *am* serious about the book. There are literally thousands of "my secrets to success" type of books written by figureheads of business such as Richard Branson, Victor Kiam, etc -- mine has the working title "The secrets of failure".

      I may not know what to do right in the world of business, but I sure have a very long list of things I've done wrong. Hopefully people will buy the book and learn from *my* mistakes rather than their own.

      Let's face it, I must have screwed up real bad to come out of the dot-com boom with nothing but pocket change eh?
  • by MSBob (307239) on Wednesday November 20, 2002 @03:14PM (#4717557)
    Salon must be incredibly expensive to run. They employ full time journos and lots of support staff and techies. If a place like Kuro5hin.org (literally a one man show) barely hangs on through fundraisers and pledge drives then Salon with their scores of employees and meager advertising income are going down the tubes quickly.
  • .. if for no other reason than to see the Spock pr0n [salon.com].
  • by Chairboy (88841) on Wednesday November 20, 2002 @03:20PM (#4717611) Homepage
    I was a paying member of Salon for a year. The main way I read Salon was through my PDA using Avantgo. Salon's method for prompting users to get premium subscriptions was by giving a 1 page teaser of a premium article, then saying they should become paying members to read the rest.

    Their avantgo channel, however, had no method in place for Premium subscribers to get full stories on their PDAs! For a year, the premium stories would have their little teaser, then at the bottom there would be a little apology to the effect of 'Sorry, we haven't made a channel for our premium subscribers yet, but we will soon!'

    Empty promises.

    They never made the channel, and since my primary interface to Salon was via PDA, I wasn't getting what I had paid for (premium access).

    Their business decision to indefinately postpone the premium channels have probably cost them quite a handful of customers, which is unfortunate.
  • by anthony_dipierro (543308) on Wednesday November 20, 2002 @03:20PM (#4717616) Journal


    During which time VA Software lost $725 million [yahoo.com].

  • by crumbz (41803) <<remove_spam>jus ... o spam>gmail@com> on Wednesday November 20, 2002 @03:21PM (#4717627) Homepage
    Man, that sounds scary. Like something from Brazil or Blade Runner. Might make your head explode if you watch for thirty seconds or more. I guess that's why Salon limited it to 10 seconds. Too much liability.
  • Too Liberal (Score:4, Interesting)

    by N8F8 (4562) on Wednesday November 20, 2002 @03:24PM (#4717654)
    I think there are many reasons Salon is failing: too much overhead, lack of a print version, content too stagnant for the medium(NET). But the real nail in the coffin is their far-left reporting/editorial. The Fray is great, but if you are going to post a bunch of baseless rhetoric to get readers fired up you had better have a convenient method for opposing views to reply. Otherwise you wind up with former readers like me, who don't like to be beaten-up with our arms tied behind our backs. Disagreeing with many of the articles drove me to read the site, but in the end it also drove me away. Slate is a similar site, but the forum is much more accessible and tied to the content and the authors/guest writers and columnists seem to actually read the forum posts.
    • Re:Too Liberal (Score:4, Insightful)

      by Aexia (517457) on Wednesday November 20, 2002 @03:40PM (#4717798)

      Because god knows there aren't any outlets for conservatives anywhere else in the media.
      • Re:Too Liberal (Score:3, Insightful)

        by taxman_10m (41083)
        I don't think that is what was meant. Leftism just doesn't sell as good on the web. If you look at successful news/opinion type sites, they are conservative. Even if you look at the best seller list for books, conservatism is doing really well.

        Anne Coulter actually had a hard time getting her book Slander published, and yet her book became an immediate best seller. Somewhere there is a serious disconnect with marketing people and what they think sells.

      • Re:Too Liberal (Score:3, Interesting)

        by ctr2sprt (574731)
        Ah, I see. Bias in reporting is perfectly acceptable, as long as you can go find bias in the other direction from a different source.

        Sometimes you read the news to be agreed with; sometimes you read the news to argue. But sometimes you just want to be informed, with a minimum of bias. Salon drove me away because its writers seemed to have a lot of difficulty dealing with that third case. I think that's what the complaint is here.

        • Re:Too Liberal (Score:3, Insightful)

          by Mnemia (218659)

          I don't even mind some bias in what I read; hell, Slashdot is very biased (though I happen to agree with most (but not all!) of /.'s leanings...). But Salon went way too far with it. Many of their articles just seemed like flamebait to me, arguing for the sake of promoting the writer's ideology to the exclusion of all logic or sense.

          Maybe I'd like Salon more if I were a serious far-lefter, but I'm pretty moderate on most issues. And for that reason I prefer to get my news in a way that is at least somewhat impartial. I mean, I want to be able to still seperate factual content from the writer's bias when I'm reading between the lines, and Salon just makes that difficult because the bias is so extreme. I used to read Salon a lot but it got to the point where I felt like most of the articles contained at least one blatent lie. That was too much and I quit visiting.

    • Re:Too Liberal (Score:2, Interesting)

      by cruachan (113813)
      Far left? Jeez. To me Salon - British - sounds distinctly 'soft right' - i.e. it's view would fit on the middle to left wing of out Tory (right wing) party.

      You have no idea what leftwing really is!

      You are exactly right, that's the main reason I stopped reading Salon just after they launched their subscription programme. I enjoy exposure to ideas that are in conflict with my own, but only if as you say there is an avenue for real debate and opposing views to be put. When they started to run into financial problems, I thought huh, maybe the Democrats can bail you out, 'cos I sure as hell won't be subsidizing you to attack my beliefs.
    • Too Conservative (Score:4, Insightful)

      by MacAndrew (463832) on Wednesday November 20, 2002 @03:46PM (#4717851) Homepage
      I'm kidding, I do agree Salon is liberal-oriented but have no problem with it given my politics. I'm pretty moderate and don't read Mother Jones or the National Review. Most magazines on/offline are politically oriented one way or another, most to far greater extremes. Perhaps out of concern for "balance" Salon has recently brought on Andrew Sullivan. I wish they'd found a better writer, but oh well.

      The remarkable thing about Salon is that it has actually broken a number of stories over the last half-dozen years. There are frequent examples of excellent writing (not all of it). Many people of influence keep track of what the journal is saying. That's quite an accomplishment, and a good deal more expensive to achieve than your average on-line reader-driven news clipping service (ahem).

      I would not encourage them to try to be all things to all people, if such a thing were possible. Certainly there could be editorial improvements, but nothing would turn Salon into a fount of wealth. The fundamental problem is the as-yet unestablished business model for this kind of thing. Others are watching Salon cast about for the answer -- the magazine is even polling its readers' opinions -- to learn from their success or failure.

      I finally did subscribe to Salon relatively recently -- I *hope* they don't go bankrupt! If they do, it will foretell decreased access to the online versions of traditional press, the failure of other online forums, and pressure on the rest to somehow raise profitability by increasing annoying advertising or other schemes. Despite it's far lower overhead, /. is not immune.

      Ask not for whom the bell tolls....
      • Take a page... (Score:3, Insightful)

        by N8F8 (4562)
        Kuro5hin.org and SlashDot are successful if you look in terms of small-business successful. But not compared to Time and People magazine. Drudgereport is another example of a "success". It seems the key to success in this new medium is to keep overhead to a minimum and provide content that isn't availabile elsewhere.

        In other words, targeting specific consumers. Salon is out there covering much of the same material with the same slant as the mainstream media. Sure they do some innovative stuff and take a little more risk, but really not that often.

    • I agree. I hate overly-biased political writing. I tend to refuse to believe anything which sounds extremist, unless I hear and disagree with an intelligent argument from the other side. I'm pretty liberal, but there's only so much W.-bashing that I can stand before I want to hear something from the conservatives, too.

      However, I'm a subscriber to both Salon and Slashdot, and I get my money's worth from them. I'll be sad to see either one go. (Hint, hint: will you be sad, too? Would it be worth a few dollars to you?)
    • You raise an interesting point. Where's the /.-like community at Salon? Slate has feedback but it's about as useful as Yahoo's boards for commenting on stories (no moderation == too many idiots). Then again, all those posts would probably mean more hardware/support costs. I don't know about a left vs. right slant in Salon (I just became a Green so I'm above it all now :-) but it is interesting reading, IMHO.

      It's all probably moot, though. While their revenue is increasing I don't see how they're going to erase all that debt.

    • Re:Too Liberal (Score:3, Insightful)

      by rodgerd (402)
      far-left reporting/editorial

      You should try sticking your head out in the world beyond the US political track. Far left my arse.

      Or perhaps reading the magazine. With such noted raving lefties like Andrew Sullivan as columnists...
    • Re:Too Liberal (Score:5, Insightful)

      by angst_ridden_hipster (23104) on Wednesday November 20, 2002 @05:32PM (#4718849) Homepage Journal
      Far left? *Far*?

      Good God, has the spectrum in the US moved that far to the right?

      Salon may be left/center, but I don't recall seeing any articles demanding redistribution of land in the US or violently returning the means of production to the proletariat. Far left is Revolution, my friend, where you don't publish people like David Horowitz, you string them up in the city square.

      Far left? Jesus F Christ...
  • by mao che minh (611166) on Wednesday November 20, 2002 @03:24PM (#4717656) Journal
    I used this little feature about two weeks ago. I wanted to read the rest of one their "premium" articles that I really wanted to see the conclusion of. I just happened to actually read one of the ad's that claimed that I could get a free pass to read this article if only I would look at this $60,000 BMW or something. I agreed. After about 10 seconds an ad with about 10 frames generated. By the time I got to the third or fourth frame, I noticed that I didn't have to click through all of the images. In the lower corner, in very fine print, was a "skip to article" button or something. It worked.
    • Special. I sat through the whole ad and then, at the end, I got to go to the page that told me to look at the ad again.

      Me not read Salon. Them too lame. Me blog instead.

  • Why they failed... (Score:2, Interesting)

    by Cap'n Canuck (622106)
    I don't have a special insight into the on-line publcation industry, but it seems to me that there are a lot of Toms, Dicks, and Harrys blogging lately. Maybe these are ex-Salon writers, but blogs allow for an interaction between soapbox ranter and listener. Even with a 'Letter to the Editor' space, a publication is still one sided. "Here's my point of view - suck on it!". And, as we all know (as is the case with blogs and OS's), you just can't compete against something that's free...

    From reading comments in here, I get the feeling that Salon's material is below par. It should come as no surprise that Salon is dead, but I'm amazed that they have lost as much money as they have. I wonder what they pay (paid) their writers?
  • by Frobozz0 (247160) on Wednesday November 20, 2002 @03:28PM (#4717680)
    I'd like to state that I worked for a company that had over 180,000 "subscribers" before it folded in 2001. We didn't charge for a subscription, but we did charge for content. Each piece of content you viewed was a small fee. Quite frankly, I was never convinced of this business worthiness of this approach. We burnt through about 30 million before going belly up. Looks like Salon will be doing the same thing.

    I think online communities are going to have a hard time selling to individuals. While the metaphore works for real world newspapers and magazines, their publishing numbers are going down. Less people are reading them because they can get free content on the web. Now, I totally believe you should pay for content, but it should be subscription based and not be on a per site basis. In a sense, it should work like AOL (I know, I know). With AOL, you get prepackaged content. I'm suggesting you pay xx.xx dollars and get a pass to 20 or 30 web sites that all use the same password. You should be able to sign up for these sites through different subscribers, like you would your domain registration or cable access. The web sites still get the same amount of money, but if one 'net-network can provide a lower price but sell to more people, they can compete. They could also provide different site packages or offer more sites.


      The content providers have no incentive to employ a middleman for selling subscription packages in this scenario. Not when there's more money to be made by setting the price and selling access themselves.

      It would only increase technical complexity too.
  • dear salon, (Score:3, Informative)

    by happystink (204158) on Wednesday November 20, 2002 @03:31PM (#4717706)
    You ran for 5 or 6 years by giving away 100% of your content and lost an assload of money :( . Then you started only giving away 80% and lost less money :) . But you have still lost 80 million dollars :(

    Right now, you should immediately switch and give away only 20% or less of your content and charge for the rest. Maybe you will still go out of business, but if you don't do this you are guaranteed to, running crazy ad deals for mercedes is not even close to a long term solution :( . And maybe you'll actually turn your business around, if that is still even a remote possibility :()
  • A BIIIIG problem w/ Salon is that the Premium (fee) content categories change from day to day. Everyday the list of columnists that are "Premium" change and what you could read for free yesterday.

    My favs are the cartoons (Carol Lay is a God(dess))

    Carry Tennis

    Andrew Sullivan.
  • by autopr0n (534291) on Wednesday November 20, 2002 @03:32PM (#4717725) Homepage Journal
    Anyone remember those old warez sites, (and some H/P/A sites as well) where they tried to force you to click their sponsors, or links to top-sites in order to access them?

    I guess all kinds of marketing comes around. But the real question is, are people too cheap to pay for salon premium really going to buy Mercedes-Benzs?
  • ...and there is no way I'd ever pay for any subscription to anything (even in print) ever again.

    The freeness of information on the net has forever tainted my opinion on things worth subscribing to, as it as done to many others. Eventually, this will lead to a ton of small sites that exist based on the owners love of whatever that site is about. The quality won't be the same, but I'll be damned if I'm paying a penny for any of that anymore.
  • It's gotten so bad for Salon they've started giving away their content management system!
  • by Chastitina (253566) on Wednesday November 20, 2002 @03:37PM (#4717762)
    ... as far as these things go. Considering that their losses are down to under $6 million/ year (per their last quarterly SEC filing), and that their income is up $0.5 million from a year ago while they've cut non-content-related (i.e. marketing and administrative) expenses by the same about, they could be viable in a few more years.

    It would take less than 200,000 new subscribers at the $30 rate for them to break even, less than 7% of the 2.7 million unique visitors they cite for December 2000.
    The main problem, of course, is time.

    Salon has been around since the beginning of the internet boom & have a loyal reader base. Unfortuntely, most of their readers are used to getting their info for free & at this point it's going to be an uphill battle to convince folks to cough up for what they've been using all along. Will they be able to do so before they have to declare bankruptcy? Let's hope not.
  • by fobbman (131816) on Wednesday November 20, 2002 @03:37PM (#4717763) Homepage
    Damn, post a story about how Salon is losing money and then link them in the story? That's like telling your doctor that you have a headache and then they kick you in the nuts.

  • Liberal media (Score:3, Insightful)

    by mao che minh (611166) on Wednesday November 20, 2002 @03:43PM (#4717823) Journal
    Liberal media is not going to be wildly successful in the United States for the forseeable future. Let's face it, the average American is god fearing, believes that his government can do no wrong, is misinformed about their individual rights, has had little exposure to liberal setiments, is not politically active, and is primed to have a knee jerk-reaction to whatever liberal opinions that they might hear.

    Wake, work, pick up the kids, watch Friends, chat on AOL, sleep - repeat. Not much time left in that equation to develop a curiousity about politics (or the world in general, outside of your hometown and what you see on CNN).

  • It's a shame (Score:2, Interesting)

    by random_nick (621821)
    It's a shame, because Salon is one of the best news sites ever in America. Salon's editorials and other pieces are just great pieces of journalism, from politics to sex. It's a bit like Wired was in it's best days. I can't think of any similar, independent site with attitude. I keep my fingers crossed for them.
  • by limekiller4 (451497) on Wednesday November 20, 2002 @03:49PM (#4717873) Homepage
    It has been noted that Salon's financial woes (how the hell did they rack up 80M in debt?) stems from them hiring good writers. Excellent writers, in fact, top-of-the-line. Noam Chomsky comes to mind. But I have to point out that Alternet.org [alternet.org] has writing that is, IMO, and just a smidge to the left of Salon.

    So I have to ask, was the 80M in debt really necessary? Personally, I like Salon, and it is one of only three news sites in my bookmarks (along with the BBC [bbc.co.uk] and the aforementioned Alternet.org), and I am a subscriber to their premium service. But the idea that writers won't write unless they're paid is a lot like the RIAA saying people won't make songs if they can't !@#$ you in the butt for $16.99/cd. Just doesn't make any sense. But it sure seems to make sense to Salon:

    "The greatest weakness of Internet users -- all of us -- is our failure to recognize the value of intellectual property. Of course we love free access to information -- the more the better. For years, those of us who are information junkies have been like pigs in mud. It has been fun, but those something-for- nothing days are over. There is a difference between the Internet mantra that "information loves to be free" and free information."

    There is a large talent pool in the world, Salon. Use it. Big names are nice but big names are why you won't exist in a few years. The notion that talented writers only write if you lob a lot of money at them is just as false for the written word as it is for music.
  • by ksuhr (68961) on Wednesday November 20, 2002 @03:54PM (#4717919) Homepage

    I subscribed to Yahoo internet life last year -- dead after 3 issues

    I subscribed to Salon last month (admittedly I knew they've been in hot water more or less the last few years) and now this

    I oughtta start charging these companies for my not subscribing to them...
  • by geek (5680) on Wednesday November 20, 2002 @04:20PM (#4718176)
    Personally I think the web is going to kill the news media as we know it today i think this is a good thing. We complain as a society when special interest groups taint our polititians, but we never flinch when they taint our news outlets.

    What it will boil down to is journalists will have to actually do something other than play on peoples emotions because the truth i.e. facts will be readily available on the net. The net will allow small time journaliistic talents to be heard on a large scale. As it is today the chances of becoming a notable and famous journalist is smaller than becoming the next Eminem.

    I'm personally sick of seeing Ashleigh Banfield on CNN dressed up like an Arab reporting on issues she 1) has no real clue about and 2) probably couldn't give a shit about anyway.

    Hasn't anyone been watching CNN? They report the same 2-3 stories all day, everyday. When they have been beaten to death they report them 500 more times until they are sure everyone in America has been brainwashed by it. Then they find 2-3 more stories that are exactly the same but have different faces.

    The liberal media is just out of this world these days. Nothing but crying and complaining and pointing fingers at everything and everyone.

    The answer is independant media run by people who do it in their spare time. Much like open source software where multiple influences and ideas are used. Right now you have nothing like that in the media, most of the news agencies are run by large corporations (MSNBC anyone?), or are influenced heavily by liberal democrats who care little about real issues.

    It's time we took the media into our own hands. There is no reason you can't report what is happening locally on your own webpage. Isn't this largely what slashdot is? It's news contributed by multiple sources for the benefit of it's own contributors. You get back what you put in.

    I'll end my rant there.
  • I like this (Score:5, Insightful)

    by victim (30647) on Wednesday November 20, 2002 @04:41PM (#4718371)
    160 responses on slashdot and virtually none that actually talk about the ultracommercial concept.

    I just went to salon and read a premium article. Here is my synopsis...
    • ultracommercial has a problem on their systems, I got pages of MySQL errors the first time I tried it. Oops.
    • The second time I tried I got to look at four spiffy pictures of a car with little click spots to get more info.
    • After the forth picture I was sent to the article I had been reading with a complete version instead of just the front quarter.
    • All in all, the ad took me less time than it takes me to walk outside and pick up my newspaper, plus my feet didn't get cold.

    If a 10 second ad can keep salon and their reporters working I'm all for it. The US needs independent journalists. (Even if they sometimes say things you'd rather not hear. Personally I'm offended by something in Salon every single day. If I wasn't, I wouldn't bother to read it.)
  • by serutan (259622) <snoopdoug AT geekazon DOT com> on Wednesday November 20, 2002 @05:48PM (#4719029) Homepage
    Everybody is asking, "How could an online magazine lose so much money" and everybody else is giving vague answers. According to their financial reports they seem to have trimmed down considerably this year, but looking at last year they were spending about a million a month on content and production, half a million on sales and marketing, $100k on research and development (??? you tell me) and about $400k on admin. That's $24 million a year right there. Losing $11 million/year doesn't seem so far-fetched.

    What interests me is that each of the two top execs made $300k last year. Not bad pay for shovelling venture capital down a hole, eh?
  • by CdotZinger (86269) on Wednesday November 20, 2002 @05:49PM (#4719034)

    ...not its dopey pro-rich-liberal bias or its coastline cliquishnes or its porn-driven, moronically desperate marketing schemes.

    And they've gotten more average as they've asked for more money. You can turn on any cable news channel and see Andrew Sullivan and Arianna Huffington saying the same stupid things they say in their Salon columns. Greil Marcus writes for every magazine on earth. Tom Tomorrow and Lynda Barry are more widely syndicated than Seinfeld. Damien Cave's tech columns are no better than your average +4 Interesting /. post or TechTV news update. Garrison Keillor is the most boring, played-out MF on the planet. (Etc.)

    They've fired their best writers (Paglia, for example) to cut costs, and hired utterly average dead-tree columnists (why King Kaufman and Allen Barra instead of, say, Ralph Wiley?--what is this, 1982?), and just flat-out failed to bring in interesting new people who could liven things up (Jim Goad, Nick Gillespie and Justin Raimondo could probably use a few extra bucks from side jobs, for example).

    Browse their archives from three to five years ago. The articles were mostly good. They were almost all interesting. Some were even surprising. But they waited until the site degenerated into PBS blandness (plus occasional class-baiting "I Was a Stripper for a Day" and "Trailer-Park Republicans: Whitey in the Wild" bilge and "classy" porn for prissy feminists and self-hating men) to start asking for money.

    That--and simple mismanagement--is why they're broke. And they deserve it. "Lilies that fester..."

  • by timestocome (597957) on Wednesday November 20, 2002 @06:09PM (#4719234) Homepage
    When will it occur to Mercedes that anyone trying to save $12 a year in subscription costs probably isn't going out to buy a Mercedes?
  • by mhackarbie (593426) on Wednesday November 20, 2002 @06:18PM (#4719294) Homepage Journal
    I've been both a Salon and Slashdot reader for a while now and I just subscribed to Salon because I very much want them to survive. I also encourage all Slashdot readers to support Salon because some very disturbing changes [salon.com] are taking place in our political system. For the first time, there is no judicial oversight of the government for secret search and surveillance of the U.S. public. Even if you believe that our freedoms must be compromised for the sake of security, the danger comes when these new investigative powers are abused and used against people for reasons other than the war on terrorism.

    The only way for us to become aware of such abuses is to have a strong alternative to the mainstream media. So I would urge all slashdotters, even those who are usually apathetic to political issues, to invest some time and energy in political awareness and support for independent journalism. Otherwise, someday you may find yourself at the wrong end of a law enforcement process gone out of control.


  • by annset (628007) on Wednesday November 20, 2002 @06:32PM (#4719422)
    It seems to me that many of these responses to Salon's troubles miss the point, focusing almost exclusively on the magazine's perceived business failings. Whether or not they, or the .com downturn, or the nation's dwindling supply of patience for in-depth and serious-minded news coverage, are to blame for the magazine's dire straits, the fact remains that Salon maintains a standard of journalistic quality and integrity that will be sorely missed if they should go out of business.

    As many of my worthy peers have pointed it, Salon does lean a little left, no doubt about it. But given our country's recent and violent list to starboard, and our Democratic leaders' apparent unwillingness or inability to act like a real opposition party, we need magazines like this more than ever.
  • I'm subscribing (Score:3, Interesting)

    by skelf (24005) on Thursday November 21, 2002 @03:34AM (#4721204)

    I've never been a subscriber to Salon, and I wouldn't say their content is all great, but one of the things that worries me most these days is the airtight corporate control over all our major (and minor for the most part) media. Salon at least does some independent investigative journalism and is not afraid to print stories from one of my favorite journalists, Greg Palast, including his exposé [salon.com] of the Florida election theft in 2000, and his "re-exposé" [salon.com] of the same thing still going on in this year's election there. Also, Joe Conason's Journal is a regular Salon political column that is almost always great. I can get stuff like this elsewhere, but, sadly not often from a place as "reputable" as Salon. If Salon disappears the pickings will be even slimmer and the Palasts and Conasons of the world will be even more marginalized.

    Investigative reporting costs tons of money, and even if Salon has the best of intentions, the bottom line will prevent them from doing lots of stories. Maybe we can use the slashdot effect to really make a difference, and not only save them, but give them the funds to actually improve. Our corporate government and out-of-control military-industrial complex need to keep the people blissfully ignorant in order to continue getting away with murder every day. Ownership of the media is their biggest weapon in this war against us, and so I've decided I can afford to pay $18.50 (or $30 with no ads) to try and save a dying breed. Who's with me?
