I spent eight years at AOL and I'll say this: I saw none of the great, all of the bad and some of the good. Throughout, the media took dead aim at our strategic zig-zags and revolving-door CEOs. We were definitely fair game. AOL created community, then lost it. It won the dial-up era, then limped into broadband. It tried to replicate MySpace and YouTube and missed badly at each. In the mid-naughts, we did hit upon a low-cost, quality content play, buying an innovative startup, Weblogs, and its publishing platform. The media wasn't impressed, scoffing at a bunch of no-name bloggers. I urged our news staff to avoid "the noise," reminded them the world was changing fast and to stay focused on what we were building.
Today, the entire news industry is engulfed in the noise around disruption. FORBES contributes its share. I've poked at publishers for doing the same old, same old -- and for a certain lack of transparency. That's nothing (at least to me) up against the now weekly gotcha missives about mixed up facts, or borrowed content, or aggregation-turned-plagiarism, or the new cardinal sin -- asking a writer to write for free. As a colleague of mine quipped, "No one's content with the ship sinking, they want to burn each other alive as it does."
The blood sport during my AOL days was about the future of media companies -- who would or wouldn't survive the digital onslaught. Actually, it was much the same during my time at Newsweek in the 80s (who needed three newsweeklies in a broadcast world). Ditto when I joined The New York Times in the 70s (was the city big enough for both The Post and Daily News). Now, the social Web with its echo chamber turns up the volume daily -- and makes it more personal, too. It's far more about the fate of the individual journalist. That quickly gets down to the paycheck. Will there be one? How much? Who gets it -- the "professional" or the pretender?
Consumer demand for credible news and information is greater than ever. The problem is the 100-year-old model for producing it is forever broken. That's why more attention must be paid to finding new ways to produce quality journalism -- efficiently, at scale and at a price supported by mobile CPMs, which at best are 50% lower than desktop CPMs, which if you're lucky come in two-thirds lower than print CPMs. In other words, a high-cost newsroom structure built for the print age will never work in a smartphone or tablet world. A few startups are experimenting with new models -- Vox Media, Machinima, Bleacher Report and Storify are a few that I follow. Among traditional media companies, FORBES is the only one I know of charting a new course.
Our goal is clear: to build a sustainable model for advertising-supported journalism. That brings me to our 1,000 contributors, a curated network of entrepreneurial journalists, authors, academics, topic experts and other knowledgeable content creators. All are building individual brands and communities around their name. Here's how it's working for them, paychecks and all:
1) The Model: We pay hundreds of contributors based on the size of the audience they attract. What does that mean? Each contributor gets paid a certain amount, call it X, for every one-time monthly visitor to their page. If that same visitor reads another of their posts during the course of the month, the contributor gets 20X for that visitor. The more one-time visits and repeat visitors, the more the contributor earns. We're into version 3 of this model, periodically making tweaks that align with our business needs and what's working for our contributors, too. We also have unpaid contributors. Many would rather not commit to a required number of monthly posts to be part of the incentive payment program. They find association with our brand furthers their media career in other ways (books, magazine articles, etc.). Still others simply value having their voice heard within a credible news environment.
2) The Budget: I look at mine in two parts: author costs (that includes full-time staff reporters and contributors) and newsroom costs (editors, producers, product and audience development people, data analysts, etc). Last month, 35% of my total digital and print budget for authors went to our network of contributors. That's up from 25% a year ago. In both cases, that's a significant sum.
3) How much can a contributor make? As I've written, a writer who attracts 1 million unique visitors a month for 12 consecutive months, with a solid base of repeat visitors, can earn a six-figure annual income. That's not easy to accomplish. In 2012, only the second year of our model, two contributors topped $100,000. We had a few at $75,000 and $50,000, and 25 hit the $35,000 mark. There is a long tail at $10,000. Using their individual data dashboard, a contributor can track how they're doing in real time. For comparison, the Bureau of Labor Statistics puts the average full-time reporter or correspondent's salary at $45,270. Remember, being a contributor (many have worked for major national and regional news brands) is a freelance job, with considerable freedom to publish content for others.
4) Are there other contributor benefits? First published in Nov. 2011, Jessica Hagy's How to Be More Interesting (In 10 Simple Steps) has generated 1.5 million page views. On the strength of that post, her book by the same title is being published this week by Workman Press. David DiSalvo, a paid contributor like Jessica, has published one book and is at work on his second since writing for FORBES. Two other FORBES contributors have published e-books through our partner, Hyperink. Every contributor gains from a connection with our brand, the benefits of our platform infrastructure and belonging to a community of respected colleagues.
We've built a unique hybrid content-creation model. We have 50 full-time staff reporters, each paid a salary, who live in harmony with our 1,000 contributors (Jeff Bercovici talks about it here). In fact, the breadth and efficiency of our contributor network has helped us maintain our sizable staff of correspondents during difficult times for the industry. They travel the world to find great stories, often meeting up with contributors in places like the Consumer Electronics Show in Las Vegas, SXSW and elsewhere. Forbes.com, more a platform than a Web site, now attracts 46 million monthly unique users as measured by Omniture (more or less the number used in calculating contributor payments) and 25 million worldwide as measured by comScore. With our model, we're also better able to align our business with the reality that 30% of traffic to Forbes.com comes from mobile users.
Week in and week out, journalists are losing full-time jobs. The New York Times, USAToday and other newspapers have offered buy outs. Reuters and The Economist are just two of many news organizations that plan staff reductions. Time Inc. will no doubt do the same as it prepares to separate from Time Warner. Will the industry's jobs losses stop? Recent history suggests they won't. Still, I believe these are exciting times for talented journalists who open their minds to new publishing models. There is far more satisfaction in building a new future than creating all that distracting noise.
Note: If you’d like to read more, check out my ebook on the future of digital journalism at Hyperink and Amazon.
