by Ben Cohen
Michael Arrington of Tech Crunch puts forward an interesting notion: What if the top talent at the New York Times left to start their own newspaper?
I’m guessing that the top performers in the news room, say the best
5%-10% of the writers and editors, produce 50% or more of the real
value of the newspaper. The hungriest reporters. The best writers. The
most competitive and aggressive editors.
What if that group, the most valuable assets that the NYTimes
controls, simply walked out of the building and started their own
company? What would that look like?
Using the Politico and Gawker 'lean journalism' model, Arrington calculates a bare bones structure where the journalists get paid top dollar, overhead runs at 20% and expenses are around another 50% of expenditure. He comes up with the following:
That’s $25 million/year to have a well paid staff of the best
journalists on the planet. How long before they outstrip those 16
million monthly visitors and 124 million page views? 5 years? Less?
How many private equity funds would kill to put $100 million behind
the NNYT to make sure the company had plenty of money until it reached
My guess is plenty.
There is a debate raging as to whether online content can be profitable, with strong cases pointing either way. The Gawker network is a successful business model having amazingly ridden out the recession, posting a 45% increase in advertising revenue.
Personally, I think bare bones journalism and tightly knit networks are the way forward (see Banter Media Group, which this site is a part of), where publishers learn to cut costs and leverage their ad space together rather than independently.
While Arrington's proposal for the New York Times won't happen, it is interesting nevertheless - and Tech Crunch is certainly in a good place to talk about it.