Emperors and beggars

Apr 29th 2010

 

Newspaper articles are expensive to produce but usually cost nothing to read online and do not command high advertising rates, since there is almost unlimited inventory.

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Content farms like Demand Media and Associated Content, in contrast, aim to produce content at a price so low that even meagre advertising revenue can support it.

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Demand Media's approach is a “combination of science and art”, in the words of Steven Kydd, who is in charge of the firm's content production. Clever software works out what internet users are interested in and how much advertising revenue a given topic can pull in. The results are sent to an army of 7,000 freelancers, each of whom must have a college degree, writing experience and a speciality. They artfully pen articles or produce video clips to fit headlines such as “How do I paint ceramic mugs?” and “Why am I so tired in winter?”

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The articles are copy-edited and checked for plagiarism. For the most part, they are published on the firm's 72 websites, including eHow, answerbag and travels.com. But videos are also uploaded onto YouTube, where the firm is by far the biggest contributor.

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In March [2010], Demand Media churned out 150,000 pieces of content in this way.

December 3, 2013

The idea with Demand was to marry two businesses: domain name registration and low-cost content production. The foundations were the acquisitions of eHow.com, a provider of how-to tutorials, and eNom, a domain-name registration service provider.
Early on, Demand used eNom’s 1 million generic domain names (such as “3dblurayplayers.com”) to serve up relevant ads to people searching for specific topics. These “domain parking” pages were immensely profitable, generating north of $100,000 per day, according to a former Demand exec who requested anonymity. “That’s $35 million-$40 million per year without doing any work,” the exec said.
But the tactic was fundamentally a bait-and-switch. Users landed on the pages expecting to find information on a subject and instead found an ad.

http://www.economist.com/node/16010291
http://variety.com/2013/biz/news/epic-fail-the-rise-and-fall-of-demand-media-1200914646/