I’ve been around the internet for a while and used to co-own a technology site. Even back then, I couldn’t figure out a business model for making money on the internet – a legal one, of course. Over the past few days, I’ve had this conversation with several folks. One pointed me to this article from Newsweek. The money quote:
HuffPo’s revenue this year will be about $30 -million—peanuts compared with the old-media dinosaurs, but way better than most digital competitors. And HuffPo has finally started to eke out a profit.
Read that again: on revenues of $30 million, the Huffington Post has eked out a profit.
But what did it take to get to that profit?
Huffington and a partner, media executive Kenneth Lerer, raised $4 million to start the site. Since then, HuffPo has raised $33 million more from venture-capital firms.
Woah – $37 million? Seriously? And the company boasts of having 178 employees. But the bloggers?
To hold down the costs, sites get a lot of content free, aggregating articles from other sites and getting readers to create the content themselves, as HuffPo does via its 6,000 unpaid bloggers.
The article says that about 40% of the content on the site is stuff that originated elsewhere. SEO – or search engine optimization – is a top priority as is the content management system.
But the revenue is coming from ads. I don’t know about you but I use an ad-blocker in my browser, so I rarely even see ads, much less click on one.
If HuffPo can’t make a profit on $30 million, what’s the likelihood that a blogger can do so operating on their own? I’d put it at about .0000000001%
Blog because you have something to say. Stop worrying about trying to make money at it.
VIVIAN J. PAIGE | All Politics is Local 
With the amount of start up money that went into the site, Huffpo should be making money and needs to make money to pay back investors. I consider Huffington Post a commerce site parading as a blog site. Blog sites don’t have venture capital behind them and most people blog for the love of writing interesting content.
Welcome to the new media business model. Content is free, employees are free to the tune of 6,000 unpaid bloggers and “the man” gets paid.