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How Bleacher Report and SB Nation Are Changing Life As We Know It

Bleacher Report logoThe one firm lesson I’ve learned in my blogging career is the impossibility of making money as a stand-alone web log.  It takes a network to raise a blogger, a fact not lost on venture capitalists and old-line media companies.

The big money crowd is showering lots of love on Bleacher Report and SportsBlog Nation. Bleacher Report got a December infusion of $10.5 million from venture capitalists. SBN drew a similar injection from venture capital firms in November. To paraphrase the late Sen. Everett Dirksen, a million here, a million there and pretty soon you are talking real money.

The promise allure pipedream of blogs was the breakthrough to new audiences by unknown writers unaffiliated with the media. The media held the monopoly distribution on original content. Kornheiser & Wilbon are good sports columnists, but not all that better than Rich Tandler, Ben Folsom and the fellas with good insight on sports at the neighborhood bar. What Kornheiser had was a pipeline to readers through his employer, The Washington Post. No independent writer could match that.

That was not so apparent in the early ’00s. (How do you say that, actually?) A guy like me could open an account on blogspot, cut a deal with Adware to draw a cushy sideline income from companies clamoring to do deals with my site. Um, right.

Real advertisers, the ones who sell real products, not the ones selling cross-links for Google placement, want a substantial audience–a few ten thousand page views per day. A good independent football blog might get ten thousand hits per month…in season. (For some reason, baseball blogs draw a higher readership even though baseball hasn’t been America’s pastime for decades.) Few independents push that volume unless the blogger is already well known.

So standalone sports blogs are worth zilch because they do not draw the audience that draws real advertisers. Bloguin CEO Ben Koo and others who follow this stuff think Bleacher Report and SBN are valued at $50 million today.

When I worked at the world’s largest computer technology company, we tried in the ‘Nineties to explain to our old line customers the disintermediation threat that came with the Internet. The Internet world order would force them to unbundle their services. Their users would have direct access to service providers, invalidating distributors while creating their own customer experience. The firms that survived would be the ones that excelled at mass customization that catered to the unique needs of each user. Mass Marketing and mass distribution were dead concepts.

Heck, I put my own self to sleep on some of those presentations. Concepts don’t sell. Success stories do. Before the mid-2000s, there were no good examples of how this worked for sports media.

My old blog network, The Most Valuable Network (MVN) got it early. They reached for new value by focusing on content,  developing a passionate core of unpaid yet hopeful writers to develop localized sites to get at that unique reader experience. But MVN was a (Brunell) family venture.  The cost of technology overwhelmed the incoming revenue to pay for it. Grass roots don’t work in this world.

SBN draws venture capital interest through their three legged approach: ad sales, back-end technology platform that ties into social media (what MVN couldn’t do) and growing distribution partnerships with media companies like Yahoo! and Comcast that MVN didn’t do enough of.

Tech platforms and marketing deals are all the buzz in the VC press releases. Localized content by SBN, Bleacher Report and other networks is barely mentioned. It’s as if the funding that creates opportunity for bloggers renders them irrelevant.  

Yet, localized reporting is at the heart of it all. SBN doesn’t just report on teams. They give us a slant–a fan’s eye view written by a community of real fans of the team. The better sites are not given to rants.  They go for bottom-up assessments that wise teams use as part of their feedback loop with fans.

This is not lost on Ted Leonsis, owner if the Washington Capitals, Wizards and Verizon Center.  Here’s what he said in answer to a question at a symposium on sports business sponsored by The Washington Post as reported on DC Sports Bog:

“I think this new media is like oxygen. Get used to it. I think that there is no more steering wheel in the hand of The Washington Post. I used to live in mortal fear about what you would write. Now, I don’t care.”

More laughter.

“I think it’s something that you need to internalize: that we’re our own media company,” Leonsis said, again addressing The Post. “I announce things on my blog. I get 40 to 90,000 people coming to my blog, depending on the subject. I have a direct, unfiltered way to reach our audience now, and I think that harnessing that is what you have to do as ownership, because we are media brands. We’re in the subscription business. We call them season-ticket holders. We’re in the sponsorship business. We’re in the same business [as The Post]. When someone goes to find out something about me, a team, or a player, and they go to Google and they type that in, I want to learn how to get the highest on the list, and I’ve done that. I don’t want The Washington Post to get the most clicks. I want the most clicks.”

The team owner disintermediated the media giant from his relationship with the fans. It comes as no surprise that Leonsis gets it. He is one of the founders of AOL and now a financial backer of SBN.

Unlike the other, more notorious Washington sports team owner, Leonsis isn’t trying to control the message. He’s trying to tap it. 

SBN’s local fan content comes at no, or very low, cost to the network. They are valued for their technology engine that broadens that content. Single bloggers who own the copyright to that content are not valued by investors. Bloggers are not union organized like pro football players. They are not getting a set percentage of the millions thrown to the network. If there’s no cut, what’s in it for them us me?

Like all writers, bloggers write to be read. A larger readership waits if the network is successful. Some bloggers will make the leap to professional journalism (Looking at you, Rich Tandler). Even old farts like me are not immune to that hope.

The more legitimate the network, the more legitimate the writer who blogs for them. Hog Haven’s Ken Meringolo is a guest on DC sports talk radio during football season. Would that have happened if Hogs Haven were not a SBN site with the readership that comes with it?

A penny earned is better than nothing. Blogs offer the promise of a share of ads run over the bloggers content. I have earned ad share the equivalent of .000000001 cent per word this year. That won’t pay the mortgage, but it’s enough to keep me going.

Point after: This is one of those stories you post on an offseason Sunday. If you followed me this far, thank you. You don’t know how much I appreciate it. If you are a blogger, check out Koo’s Corner, the blog of Bloguin CEO Ben Koo. Ben is great at keeping up on this. 

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