Andrew Sullivan goes indie, subscription-based, raises $100k first day

Blogger, writer, pundit (though he’d probably wince at that third term) Andrew Sullivan has taken an uncertain financial certain and made it even more uncertain, and exciting.  He’s leaving a cushy (presumably well-paid) spot blogging at the Daily Beast and is striking out on his own, with this staff, ad-free, surviving solely off of subscriptions.

Wow.

I’ve written before about the financial difficulties of running a small online media venture in the post-Lehman world.  There’s a lot going against you.  Not the least of which is the fact that, as I mentioned the other day, advertising is dying as a financial model.  That’s why you’re hearing more and more about your favorite sites holding fundraisers, and others going “premium” in some way or another.  In a nutshell, the bubble of free quality Internet content is bursting, fast.

I read a tweet yesterday that ticked me off.  It was from a young guy working for a well-known online media venture, who tweeted that he’d never pay money to read a Web site (you could practically hear the disdainful stress he put on the words “never” and “Web”).  And a lot of people wouldn’t.  “Why buy the cow?”, as they say.  We’ve all gotten accustomed to – spoiled by, even – free quality content across the Internet.  Even I’m guilty of it. I stopped subscribing to the Washington Post four years ago. Why pay for it, I figured, when I can get it for free online.

It was, in retrospect, a dumb idea for the Washington Post to offer paid subscriptions at the same time it was offering the exact same content for free.  It almost seems idiotic, in retrospect, to think the result would have been anything but ever-decreasing revenue and profit.

Andrew Sullivan

Andrew Sullivan by Trey Ratcliff.

The blogs started differently.  We didn’t get into the game expecting a profit.  We have something to say and the Internet let us say it.  As our readership and influence grew, so did our time commitment, and the desire, but also the need, to monetize a venture that was transitioning from a part-time hobby to a full-time job.   At some point, when you’re working continual 14 hour days, you either need to find a way fund yourself or find another job.  And for a while, advertising filled the financial void.  It permitted us to work, and grow, the Netroots, and become a powerful and influential force in American politics.

Then came Lehman, and four years later, we’re all – from the biggest news site to the smallest blog – trying to figure out how to make a living when online advertising is dying, or at the very least has fallen and doesn’t look like it’s ever getting back up.

In Andrew Sullivan’s case, the proposed solution is subscriptions, a bit New York Times-style, but less restrictive.  You’ll still be able to read the content on the home page, and any longer articles (presumably with a “read more” button) will require a subscription.  But, you can still read all the content via RSS, or via an outside referral (i.e., a link fro twitter or another Web site).  Andrew reports that during his first day he raised over $100,000.  And that’s pretty amazing, considering he asked for $19.99 a person.  One donor even gave $10,000.

Felix Salmon of Reuters estimates that for Andrew to run his venture, including paying seven staffers, will cost $750,000 a year.  So while $100,000 in one day is a darn good start, Andrew will need to keep it up in order to fund his venture for an entire year, and then he’ll need to start all over again next year.

I don’t know what the answer is.  I stopped doing regular fundraisers years ago, when advertising became a serious way of funding our operations.  Those days are over, and we’re fundraising again.  We’ll also considering other more-creative ways of raising money for specific aspects of the blog, and will hopefully announce some of those soon.

I don’t know what the answer is.  And maybe, as some (younger) people have said to me, our current predicament is neither good nor bad, it’s simply change and progress, and will eventually lead to something new and better.  I hope that’s true.  But I worry when I see publications like Newsweek assimilated and shut down, and when newspapers across the country are cutting back and turning off.  It is definitely a new era.  I’m still struggling to see it as better.


Follow me on Twitter: @aravosis | @americablog | @americabloggay | Facebook | Google+ | LinkedIn. John Aravosis is the editor of AMERICAblog, which he founded in 2004. He has a joint law degree (JD) and masters in Foreign Service from Georgetown (1989); and worked in the US Senate, World Bank, Children's Defense Fund, and as a stringer for the Economist. Frequent TV pundit: O'Reilly Factor, Hardball, World News Tonight, Nightline & Reliable Sources. Bio, .

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  • Sweetie

    The Youtube music video posters spam like that in order to shut down discussion. It’s a form of astroturf.

  • Sweetie

    Sullivan, the guy who writes all sorts of logically-challenged puff pieces about Obama and his policies?

    The only time I like reading him is when Greenwald highlights one of his numerous faux pas.

  • SanFranGuns

    I feel the pain of online blogs and news producers – but good luck charging. I get that information isn’t “Free” because advertisers pay for it in other forums. I also get that you all deserve to make a living. But are people seriously going to pay $19.99 for every single thing they read every day? I suppose if you’re a person of means, that would be doable but that’s completely unrealistic for most of us. Does that mean we don’t deserve to get news and information? Poor people should still get access to what’s going on in the world. Good for Andrew Sullivan, but let’s talk again in six months or a year and see how he’s doing. My gut tells me he won’t be doing so well. We are on the cusp of a new world and its the responsibility of the online community to come up with a way to balance engaging people and making a profit. Doing it on the backs of your readers might sound fair, but its going to be a losing proposal. We can’t front the bill for every single blog/news page and that means there will be less of you – less voices and opinions. It would be a tragedy

  • lynchie

    But that might preclude a visitor from seeing what is nice about AB the back and forth, new ideas, etc. Earning a living for John and the other contributors is the issue and we have to face reality in having to pay for the things we enjoy. I don’t want HP with its daily Kardashian story. So raising money without being commercialized is important. Perhaps some of it might come from John really marketing the site. The readers are intelligent, of mixed backgrounds, tolerant and don’t advocate the insanity of a lot of other sites.
    Things to think about/.

  • Naja pallida

    I still follow a couple bloggers there, but haven’t participated in the community since they changed their formatting, and I had multiple posts outright deleted, despite having nothing offensive in them. Just not worth my time to post some place that is going to censor to the point of not being able to make a valid point in favor of trolls and sycophants.

  • condew

    Maybe the answer is micro-payments that stop when you’ve paid a total of $2 in a month or $20 in a year; so you can sample for a small fee, and regulars get a discount.

  • condew

    Talking Points Memo is offering premium content for a $50 subscription. I might have given it a try, but when you sign up it isn’t just $50, it’s permission to take $50 from your credit card every year until you tell them to stop. I want to be asked to re-subscribe, not discover I’ve re-subscribed when my credit card bill is $50 more than I expected.

  • condew

    The abysmal comments is the main reason I stopped reading Huffington Post. All those inane conversations about music, or personal stuff like wishing each other happy birthday; no respect at all for being relevant to the article and lots of copy-and-paste spam with the same drivel repeated endlessly every few pages. And I would get moderated out or delayed until my comment was irrelevant on page 84.

    And then the articles started to get right-of-center.

  • condew

    I worry that “micro-payments” would grow to abusive “ubiquitous payments” where every page click costs you another quarter; whether the content is worth it or not, and adding up to $20 or $30 for an afternoon’s reading.

  • condew

    Putting the comments behind a pay wall might solve 2 problems; funding and trolls.

  • condew

    I’ll second the idea of a subscription fee for an ad-free version. I kind of resent it when I pay for something like satellite radio, and then have to endure ads. Say I pay $20 for news or entertainment, and then the provider lets an advertiser mess it up for what, a fraction of a cent?.

  • billylost

    agree, absolutely – isn’t it the money we spend at Starbux that’s become the archetypal analogue for such expenditures? – so we have to pay up, small amounts, to get the information that enriches our lives (and provokes us). that’s the new reality – and John deserves our money as much as AS does – more, I think

  • SkippyFlipjack

    I thought the same thing — lots of people were saying “why would anyone pay for TV?” IIRC cable TV started in rural hilly areas that were having trouble getting conventional TV signals, so people would pay out of necessity.

  • SkippyFlipjack

    “But I worry when I see publications like Newsweek assimilated and shut down” — they weren’t shut down, right? just converted to online only? that wouldn’t seem to be a bad sign for the future of online news, nor a bad thing for blogs which occupy a different ecological niche than Newsweek

  • Indigo

    I share your willingness but not as long as Amblog uses the Disqus system which has repeated screwed up my files.

  • JD234

    It’s hard to see how the paywall approach leads to new readership. The Times and other magazines essentially advertise themselves via paper copies all over the place, and even then, they largely depend on their reputations for drawing in new readers. But I really don’t see how casual visitors following a link or two, or especially young people, will read enough good stuff to actually make the $20 commitment.

  • http://adgitadiaries.com/ karmanot

    Yes, Firedoglake went a similar route. It is so difficult to comment I long ago stopped reading the site. When FDL first started one could communicate with Jane herself. I miss those days.

  • http://adgitadiaries.com/ karmanot

    Same here Naja. Sites just as this one are my main source of News. The local papers, The San Francisco Chronicle or The Press Democrat are expensive and can be covered from top to back in less that five minutes. 70% of the content is advertising. If blogs go subscription , it will simply enhance the trend of America to dump its seniors, and low income people and keeping them ignorant of the creeping corporate fascism that has destroyed the Democratic experiment.

  • http://adgitadiaries.com/ karmanot

    “They lost out because they failed to realize the advantage they once had and that was investigative journalism.” Bingo! Also, applies to cable for the most part. Rachael Maddow is one of the rare journalists with a forum. Sullivan will sink like a stone, or compromise his quality and end up like the corporate tool, HuffPo.

  • http://www.rebeccamorn.com/mind BeccaM

    I would gladly pay a reasonable subscription fee for an ad-free version of AmericaBlog, and so I could also get full-copy RSS feeds rather than one-sentence summaries or ad-laden full-renders.

    My other suggestion, John, possibly in addition to the subscription — or in return for a donation — would be a commenter label or tag denoting ‘Supporter’ status. In practice, it would probably look like the ‘Moderator’ tag.

    Honestly? Sullivan may do well for a year, maybe two, but I’d wager anything his effort goes belly-up after that because what matters is sustainability.

  • dula

    Ad free? Remember when cable first started and they said we had to pay for it because there were no ads?

  • lynchie

    I would be willing to pay a monthly fee to visit Americablog. Something reasonable of course. I fear Andrew has gone overboard since he offers no place for his readers/bloggers to chime in on a subject. That is the beauty of AB people can dissent (sometimes with too much passion) but they can dissent and if we are inundated with trolls the family can usually drown them out. John I think everything changes. The Internet was started a way to explore for free and you can still do that, but if you want current affairs, politics and alternate views the place to get it is on the web not newspapers. They lost out because they failed to realize the advantage they once had and that was investigative journalism. The NYT lost it when they allowed Judith Miller to replay the Bush/Cheney Valerie Plame outing. There is no one, no one, investigating and asking the tough questions of our politicians they are simply scribes. The same goes for the Broadcast Media the repeat material as news but no one holds anyone’s feet to the fire and does a honest job of follow up. That is why no politician is afraid to lie they are never held accountable. The media want to be invited to the parties (David Gregory rapping with Rove) they have sold out just like the politicians have.

    So I would be willing to pay something.

  • http://www.thoughtcrimes.org/ Kelvin Mace

    A patron-based model is better than a a subscription-based model if you can get enough patrons. To do that, you need to give some cache and value to being a patron.

    Micro-payments are the place that the government SHOULD get involved, and for a LOT of very good reasons. In essence it would become a “market-maker”, acting as a clearing house for micro-payments, which would create a revenue stream. Private companies like PayPal won’t do it because the profits are too small, but he government doesn’t need “big profits”, just “fractional” taxation which would pay for the system and, given a few years, could become a significant income source.

    In fact, a micropayment system could be the entry point for a “publicly-owned” banking system.

  • Naja pallida

    I can deal with the conservative part, at least he’s one of those conservatives who realizes that it isn’t all about winning elections. At some point you actually have to govern… but I still wouldn’t pay to read anything he had to say.

  • Naja pallida

    Seems to me that would erode the feeling of community that generally encourages people to feel loyalty to a certain site. Especially if people feel snubbed that their “comments” are being unduly moderated, or ignored. That’s one of the many things that cost Huffpost most of its initial readership, and why their commenting area is basically nonsensical drivel now. Anyone with any valid point to make has been either drown out, or censored by overzealous moderation.

  • Hue-Man

    My greater concern about the media melt-down is the reduction in resources applied to basic research and reporting. It’s much like the Nate Silver example; he was very successful in analyzing the polling data generated on the ground by the various pollsters. Without that data, there would be no Nate Silver. The same applies to Andrew Sullivan and most of the blogosphere – without access to original reporting, they become opinionated seniors sitting in their lawn-chairs yelling at passersby!

  • Hue-Man

    Dish has a no comments policy; e-mails are read by the team and quoted anonymously when Dish editors feel it’s relevant. It’s one way of shutting down the endless personal attack/counter-attacks but relies too much on editors wading through thousands of e-mails looking for pearls of wisdom.

  • Drew2u

    Don’t care about him, but I understand setting him as an example of a larger issue.

    Is there any credibility to the $1.4 Quadrillion derivatives bubble statement/theory?

  • Naja pallida

    He might have had a good day up front, but I honestly don’t see his model being sustainable in the long term unless he has some really interesting content, and an extensive community of involvement. Inevitably It will be narrowed down to a small number of loyal readers, and an echo chamber of people paying for the privilege of commenting to each other. It isn’t even fair to compare it to paying for a newspaper, because there are a hundred other bloggers out there willing to do it for free. Most may not have as an established presence, but internet users are fickle, and in general are happy to go where they can get something for free over paying for it. Especially when it comes to the daily news that is widely available from many different sources. The only hope is to offer a product that is significantly superior to what is available freely, and since no one can always provide superior content, have some kind of structure that doesn’t disappoint people for paying for things they don’t want to bother reading. I know myself, personally, I spend a lot of time reading blogs and news sites, but I don’t have the disposable income to spend on them when I can get the vast majority of the information for free.

  • nicho

    I should have read your piece before I posted my micropayment screed. As far as AS, I don’t care how much money he made on Day 1. The telling thing will be how much he brings in next week.

  • nicho

    Where news media dropped the ball was in going to lumps-sum paywalls instead of micropayments — along the App Store model. I’m not going to pay the Grey Lady a big sum to get tons of stuff I don’t read. However, I would chip in, say, a quarter to read a Krugman column or some other piece I was interested in. I might also throw the Boston Globe 15 cents to read a particular columnist or story there.

    In the long run, the Times and other papers would get as much — or even more — money than they do with their big, lump-sum paywall. A few months ago, I saw that my best friend from grammar school had died. I went to his local paper and they wanted $5.95 for me to read his obituary. This was after they had extorted hundreds of dollars from the family to print it. I refused. I would have given them a quarter.

    I’m not going to subscribe to 20 different online news sites — and picking one of them doesn’t do the job for me, since most of the stuff they print is dreck. However, I’m willing to throw a few cents at them every time I read an article or column I really want to read. All they need is some type of clearing house to handle the payments and bill me at the end of the month.

    Of course, this is the industry that refused to carry TV listings back in the ’50s because they saw TV as competition and they didn’t want to help the “competition.” This short-sightedness made Walter Annenberg a billionaire after he started TV Guide. Newspapers tried to catch up, but none of them ever had a television guide that wasn’t a losing proposition.

  • Nylund

    Maybe it won’t be better, but we can’t go back. The world moves forward, sometimes in good ways, sometimes in bad ways, sometimes in ways that are just different.

    I don’t know if I’ll hand AS $10.99 a year, but let’s be real, we’re talking a nickle a day. I used to pay much more than that for a newspaper. I don’t get a newspaper anymore because I can get everything for free on the web, but if the web evolves in a way that I’m paying a nickel a day to my 10 favorite websites, that’s no more than I used to gladly pay for just one news source back when a paper was dropped on my front door every morning.

    Yes, we all got used to getting it all for free for a decade, but people have to stop acting like it’s some horrible injustice that we may have to once again shell out a quarter or two every day, when so many of us did that gladly for a very long time.

  • MyrddinWilt

    BBC is always going to be free.

  • MyrddinWilt

    I did try to get micropayments working on the Web back in 1993. Then the newspapers arrived, dumped their content on the Web for free and there was no reason to build a payment infrastructure.

    One option that might work would be to have a subscription scheme similar to cable where you get a lot of blogs for a single subscription price and then the revenue is shared among the blogs according to traffic. $20/yr seems a bit much for Sullivan given that I read maybe four of his articles a year.

    Problem is reach. People blog to get an audience, not to make money. So any subscription based scheme would have to attract at least a million subscribers. Any that got to that point I would expect would reach a tipping point and grow much larger. But a million subscribers at $20 each would be enough to keep a hundred bloggers going.

    What worries me about Sully’s scheme is the $10K donation. Keeping the blogs running through big donations would be easy. In fact that model already exists, we call it wingnut welfare. The reason the GOP is in the situation they are now is that the right wing blogosphere was bought up but the likes of Koch and Scaife and a handful of billionaires.

    The marginal cost of visiting another blog has to remain at zero.

  • nicho

    One of my New Year’s resolutions is to spend less time on the Internet. All these paywalls are making that much easier.

    Actually, this is free-market economics at work. Do I read AS if I stumble across one of his pieces? Sure. Would I pay to read it? No. That goes for a lot of other sites as well. There’s only a tiny handful of things I read in the NYT, so I’m not inclined to pay their subscription fee. And as long as the WaPo is free, I can find out most of what I want to know.

  • http://www.facebook.com/randyariddle Randy Riddle

    Welcome to the world of the Internet as cable tv. For years in the US, broadcasts were “free”, paid for by sponsors or offered up by stations and networks as free public service programming. Now, we’re headed for the cable tv model – basic cable is all the “free stuff”, another tier for sites like Sullivan’s that are “semi-open” and “premium” channels, like Netflix or porn sites, that charge monthly. Sullivan going indie is really a big yawn in my book – what will be a game changer will be bloggers and news sites gathering together into “packages” for “one stop” subscriptions for readers. Then the “free” Internet will be dead, dead, dead.

  • http://www.facebook.es/people/Jim-Morrissey/583382528 Jim Morrissey

    I wouldn’t pay a penny to hear his dribble. He called the election off after the first debate, usually sticks his foot in his mouth and is in his heart – a conservative. I guess he has to pay for all his boy toys and houses somehow. What a fraud.

  • Indigo

    “New and better” are off the table. That was the late 80s and the early 90s. We’ve grown way past that into established Cyberspace & Company, so middle-brow that even the Valley of Porn is tamed and looks the same. So, yes, it’s time to charge for idle chit-chat and see how far that goes. As for AS, pundiferous is all I’ve thought him to be. Is there actually an AS fan club that he was able to harvest $100k right out the gate? That brings to mind a saying of H.L. Menken’s . . . but you already know that one.

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