The Toronto Star has an interview with Ariana Huffington, who will be in Toronto today, but doesn’t bring up the subject of the Huffington Post’s legions of unpaid contributors or its propensity for extreme downmarket content.
In the five years since Huffington co-founded the Post with former AOL executive Kenneth Lerer, it has grown to eight million unique visitors a month, half as many as the website of the mighty New York Times. Huffington Post is also an online newspaper of sorts, with a growing number of “verticals” roughly equivalent to sections, including local editions for major cities as well as sports, living, comedy and impact, a section about charity and “giving back.”
The site has raised $30 million (U.S.) in two rounds of financing, the most recent by venture capital firm that valued the site at $100 million.
All this while many traditional U.S. newspapers are struggling with the challenge of new media made worse by an economic downturn that saw advertising dollars shrink.
At least some of that could also be due to sites like The Huffington Post, which freely borrows content from mainstream media sites to enhance their coverage. Huffington calls it the “linked economy. We link to others, they link to us and that’s how we see the future.”
Last week, The New York Times said it plans to begin charging online readers in 2011, a controversial move that has failed to work for most publications that have tried it. Huffington said she is not concerned about the potential loss of free Times content.
“Our site has an enormous amount of original content. We have about 250 blog posts a day, which are original. We have reporters who are covering Washington and the economy and writing about everything that’s happening. And we do also a lot of aggregation from existing sources.
“We at the Huffington Post are committed to a very different business model, which is based on advertising and growing our traffic, which has skyrocketed over the last year,” she said.
Indeed, when accessed from a Canadian computer the site displays ads by well-known Canadian companies, including Shoppers Drug Mart, Canadian Tire and Intrawest’s Mont Tremblant resort.
When asked for more details about the company’s business model, including whether it is profitable, Huffington noted that it’s privately held and does not disclose financial results.
“The Huffington Post would be profitable if we stopped spending money to expand. We are in an expansion mode,” she said. “We are putting a lot of emphasis on social news. On integrating our readers so they become content providers. They share news, they react to the news.
“We’re doing more and more original reporting. We launched The Huffington Post investigative fund, which is breaking stories out of Washington. We’re about to launch a college section that will deal with colleges around the country, having a place for content from students, from academics, professors. We’re in a constant mode of expansion.”
The last figures I saw had the HuffPo with six paid writers and 4,000 unpaid bloggers. That’s quite a business model!
It does many things right, but why on earth does it need content such as a walrus blowing itself?
Another interesting thing is that newspapers, which everyone seems to agree are fading in the U.S., are seen as department stores in a boutique world.
But with its wide aggregation, the HuffPo seems to be trying to reinvent the department store.