Mashable Fired Federated Media in January

Pete Cashmore went on Old Media raw data buffet Bloomberg West today, and amongst other things, let slip that Mashable fired Federated media. He followed up with a rare post on Mashable proper:

imageHow are we fueling this growth? Among other big moves this year, Mashable took over its own ad sales at the start of 2011 – ads had previously been handled by our ad partner. This more than doubled our ad revenue, allowing us to grow the team, expand our coverage, and bring on seasoned journalists like San Francisco Bureau Chief Chris Taylor (formerly of Fast Company).

This does explain the massive personnel growth Mashable’s been displaying this year.

Here’s the problem with Mashable (without going into my petty quibbles with current and former staff members): Mashable still relies on CPM ad models, and thus severely undervalues the market position they hold.

SiliconANGLE has been functioning quite highly on our data-based revenue model for quite some time (I’d have to check my calendar, but I’d say it’s coming up on a little over a year now), and while our data-based revenue model is nascent, I’d be proud to put the financials of Mashable and SiliconANGLE side-by-side and see which one values work output more highly.

CPM, CPC, and CPA are dying models. Try as you might, you can’t compete against the likes of a Demand Media or a Business Insider. Demand has cost of content production to a fine science, and Business Insider has absolutely perfected and picked up tripe-printing where World Weekly News left off. The BI/WWN model is as profitable as The Onion; that is, when you don’t hafta waste time on research, you can print a lot of outlandish crap in great quantities.

Time for innovation. Should Mashable actually do some business model innovation, they’d be unstoppable.

Thankfully, it appears that most of my old co-workers no longer read my blog, and my new secret to success is safe for now.

2 Comments

  1. do some business model innovation,

    such as????

    Reply
    • @MattSharper Sorry – either due to the holidays or a technology snafu, I didn’t see your comment.

      In terms of business model innovation, I’d strongly suggest a number of things in terms of editorial focus (if I were still on staff – I’m not going to share the entire SiliconANGLE playbook, since we’re still executing plays out of it at our company).

      On the more broad side, though, the biggest innovation I could encourage them to focus on would be to come up with a viable alternative to CPM. There’s a very low ceiling of capital you can raise with sponsorship models, there’s lots of conflict of interest problems with VC plays, and when you’re still a (very large) niche player, it’s even difficult to reliably fund operations from conference income, too.

      This sounds like it rules out a lot of viable models, but trust me, there are many more out there that would work to sustain a blog of Mashable’s size. There are around 40 part-time and full-time workers at SiliconANGLE the last time I counted, and our traffic is a fraction of Mashable’s size (which must mean, if you connect the dots, we’ve found a way to more highly value the content we create than Mashable since we keep these folks paid).

      Reply

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