Vox Media, the company behind SB Nation and The Verge, is acquiring the Curbed network of real estate and food blogs for about $25 million, according to multiple news reports. It’s one of the few large-scale, digital-native content acquisitions in recent memory — as opposed to the usual phenomenon of traditional media outlets buying online players to get a little digital credibility — and the deal has some media observers like Felix Salmon at Reuters musing about who might be best placed to build a Time Inc.-style digital-content behemoth.
But is that really something we want or need? Wasn’t part of the promise of online publishing and the democratization of media that we could get a thousand different viewpoints and a proliferation of niches? Theoretically, at least, the web and digital tools were supposed to make it easier for small publishers to thrive by connecting directly to a community of like-minded readers.
Is building massive scale the only strategy?
Instead, the vision that Salmon endorses — via Business Insider CEO Henry Blodget — is what you might call the Highlander model, in which there can be only one massive media entity that controls or publishes dozens (or even hundreds) of online publications based on various verticals, and the only way it wins is by killing or acquiring everyone else. That’s the strategy Vox Media CEO Jim Bankoff seems to be working on as well, saying the acquisition of real estate and food blogs is part of a plan to “blow out these major consumer categories.” As Salmon describes it in his post:
“As Blodget said on Friday, if you’re going to make serious money in this business, you need serious scale. If you want serious scale, you have to be able to expand not only organically but also by acquisition. And if you want to be able to scale up through dealmaking, you need to have a technology and sales platform which can support large-scale acquisitions.”
I understand why venture-funded entities like Vox Media — which just recently raised another large financing round of $34 million — and Business Insider see this as the right (and possibly the only) strategy, since they have to achieve enough scale to provide a return for their investors. It’s not enough to just have a business that makes a decent return, you have to generate what Blodget calls “serious money,” whatever that is (a rough guess is that it probably starts with a “b”).
But is that really what success has to consist of in a digital age? Time Inc. and other publishing giants like Conde Nast built empires because that was the only way content worked back then — not only did you have to control as much of it as possible, but you needed massive amounts of scale because you had to print millions of copies of each magazine and put them on trucks and drop them off at people’s houses, etc. But the days of mass media were supposed to be over.
An old advertising model is the real culprit
So why is this kind of scale required? How have we arrived at a place where — as Blodget put it in a Google Hangout with Salmon and Stocktwits co-founder Howard Lindzon on the weekend — “if you don’t have 100 million uniques as a general news organization, you might as well mail it in?” Although he doesn’t really discuss it, Salmon puts his finger on the real culprit near the end of his piece:
“I think I can begin to discern the vague outlines of how digital publishing might eventually be able to deliver the kind of scale and impact that brand advertisers demand from TV and glossy magazines. I don’t know who the winner is going to be. But I do think that Blodget is right about one thing: whoever the winner is, they will have to have some very deep pockets. Winning this game won’t come cheap.”
So massive scale is necessary because advertisers — especially those accustomed to TV — apparently require it (which is why Twitter has made the changes it has as well). In effect, we are rebuilding the mass media of the old days because advertisers can’t think of any other way to make money other than by accumulating billions of pageviews, and publishers are being dragged along for the ride. In order to play ball, and generate the kind of revenue their backers require, they apparently need to achieve global scale or die trying.
Is this really the future we want for online media? Doesn’t it just mean that we wind up with one or two giant conglomerates whose only business model is based on pageview-driven clickbait content? That’s the model that Business Insider appears to be pursuing — one that involves producing more and more pageviews that bring in less and less revenue. Is this the only possible future? I honestly don’t know.
Perhaps we will wind up with a bifurcated market, with giant predators who rely on massive pageviews at one end and tiny, nimble players who focus on a niche at the other end. Which will turn out to be the dinosaur and which the mammal?