Industry Moves: Heist Promoted to CEO at HighGear; Founder Kutscher Upped To Chairman

Nearly a year after he joined High Gear Media as COO, Matt Heist is moving up to CEO, while founder Hesky Kutscher becomes chairman of the board. Kutscher had been CEO since founding the fast-moving auto-news network in 2007. Heist, who was SVP and GM of Sidestep.com before joining High Gear last September, has been managing day-to-day ops and general corporate strategy so it shouldn’t be much of a shift internally.

The company recently raised $5.5 million in a second round of founding from DAG Ventures, Accel Partners and Greylock Partners; that brought the total funding to $12 million. High Gear acquired luxury car enthusiast site MotorAuthority last week, bringing the total of owned-and-operated auto sites in its network to 39. Release.


MSNBC.com: EveryBlock.com Won’t Replace Local News


NEW YORK (AdAge.com) -- Among the conundrums left by the newspaper die-off: What is the new model for local news and information, once the sole province of community newspapers? MSNBC.com snapped up one of the more promising efforts, EveryBlock.com.


Why Ridding And Murdoch Can’t Stop Talking About Pay Walls

Rupert Murdoch and Financial Times CEO John Ridding sure like talking about why newspapers should charge for content—but few papers have followed FT.com in charging and none are yet as squarely behind Murdoch. Ridding appears in yet another newspaper today (NYTimes.com), talking up the paid content paradigm. But what’s in it for them if other titles follow their lead?

FT.com MD Rob Grimshaw told me in an interview earlier this month: “We have been the black sheep of the industry for seven or eight years but we believe very passionately that it was the right thing to do…. We would like other publishers to join up”. He continues: “Our experience has been so positive—we can’t understand why they have been so reluctant.”

But why does the FT want to stop feeling like an outsider as the sole UK national newspaper to charge online? Put simply - if other, general-interest titles start asking for money, FT.com’s existing, high-end paid-for news might also seem worth handing over cash for. That would make it easier for FT.com to build on its current 117,000 paying subscribers. Likewise, the normally less open Murdoch is trying to soften up rivals to follow him in charging, fearing that, if he raised the wall alone, he might find readers knocking on other doors.

I asked Grimshaw whether the forthcoming Sundaytimes.co.uk could make a success of charging for content. No comment on that one, but he added: “In general, we don’t see any reason why paid content has to be confined to niche marketplaces.” It’s an uncomplicated plea to publishers to boost their revenues—and the FT’s—by supporting a single paid model.

But Ridding and Murdoch are well aware that if publishers clubbed together to so much as discuss an industry-wide willingness to charge—let alone a shared technology or cartel—the UK’s Competition Commission might express displeasure. So what better way to side-step that problem than by having the debate in public… ?

Trinity Mirror (LSE: TNI) CEO Sly Bailey and Guardian Media Group CEO Carolyn McCall told the Culture and Media Select Committee in June that competition laws banned them from meeting to talk about how to tackle “superdominant Google (NSDQ: GOOG) News”. Publishers in the US had to meet in private to escape the attention of anti-trust authorities. By making public statements, rather than agreeing private strategies, they escape risk of antitrust action…

Related


Web Magazine Salon Fires Six Staffers, Voilá — Now a Web Publication

puzzleWhat’s the difference between a Web magazine and a Web publication? We’re not exactly sure, either. But apparently Web magazines harbor bloated staffs, and before they can transform, butterfly-wise, into Web publications they have to give a few beloved staffers the axe — at least, if the caterpillar in question isSalon.

Salon has laid off six of its 29 editorial staffers — 20% — in response to the economic climate but also in preparation for a redesign this fall, according to a post by Gawker’s John Cook yesterday.

“We are moving away from a very traditional magazine production model and becoming more of a true Web publication,” Richard Gingras, CEO of Salon Media, said in a statement.

Huh? Cook called Salon, which has remained largely the same since it was founded in 1995, “the cockroach of the web,” having survived so many generations of Web innovation and refashioning. So now they’re becoming a true Web publication? Layoffs are layoffs. It’s a challenging time. That’s a good enough reason without corporate double-speak that doesn’t make any sense.

More than that, it’s apparently very necessary. David Weir at BNET read Salon’s latest SEC filing, and didn’t like it:

“The Company’s operating forecast for the remainder of the fiscal year ending March 31, 2010 anticipates continued operating losses,” says the statement accompanying the financial results. “Salon estimates it will require between $1.75 and $2.5 million in additional funding to meet its operating needs for the balance of its fiscal year.”

I’m always saddened when hearing of yet more layoffs in our industry, one that has already been so pummeled for so long that there seems no light at the end of the tunnel. But, you can see from the numbers culled from the SEC filing that new CEO Richard Gingras really had no option but to further cut costs, and at Salon, that primarily means the human costs of producing content.

In Gringas’ statement he said that “[t]he financial changes emphasize what we do best — publish sharp, fast takes on the important events in the world, as well as the in-depth stories, reviews and blogs that readers come to us for” and said that Salon’s tradition of “great writing from great writers…will continue.” A look at the positions cut suggests that the emphasis will be on “sharp” and “fast” rather than “meticulously-edited”: According to Gringas, they let go 3 editors, 1 writer, a photo editor and a multimedia producer. Three editors – that loses a layer of work on a story, not the story itself. It is more complicated than that, obviously, but it seems clear that everyone at Salon will have to get leaner, better and faster with these changes. Joining an ever-growing media club.

The last round of Salon lay-offs to make news came last November as reporting on the presidential election was beginning to wind down. “I feel like a Civil War general who has had eight horses shot out from under him, yet remains eager to saddle up again,” wrote then-Washington bureau chief Walter Shapiro in response to his dismissal. Before that, editor-in-chief Joan Walsh said that site hadn’t cut staff since 2001.

Related:
Salon Lays Off Six In Pursuit of Becoming a ‘True Web Publication’ [Gawker]
The Numbers Behind Salon’s Layoffs [BNET]

Hyperlocal Revenues, Yes, They’re High

The figures we used for our Hyperlocal model were based on three market sizes — small (20K), medium (35K), and large (60K) — supported by a broader Framework of local businesses and ad networks.

Yes, our work assumes that “in a metro market of 5 million people, the hyperlocal network will be able to get 1.75 million readers (35 percent penetration) in Year 1, growing to 3 million readers (60 percent penetration) in Year 3,” as TechCrunch points out.

That would allow a large blog to increase its gross revenue from $126,976 in the first year to $331,640 in the third, while growing its net income from $42,277 to $148,269 in the same period — assuming that staffing costs will also increase. Hyperlocal sites like Baristanet and West Seattle Blog are coming close to those figures without optimization and efficiencies we believe ad networks and the framework would provide. West Seattle also attracts about 20% of the community (pop. 68,000) to its site regularly, resulting in about 800,000 page views per month as of late last year. (Click here to view the Hyperlocal & Framework models as a Google Document. Be sure to click on the Revenues for Blogs and the Income Statement for Blogs tabs at the bottom of the spreadsheet to view all figures related to this post.)

We’ve compiled our numbers for each market size based on several revenue opportunities, including advertising, business-to-business services and e-commerce. While not all of these opportunities would work for all sites, our team found enough revenue models to support our assumptions.

And from what we’ve been reading, there is certainly strong interest in hyperlocal news these days. See the PBS Engage/Knight Commission online survey about community information needs published in April, as well as our post on ESPN going local. As a final note: to cover the largest targeted readerships we extended the taxonomy of hyperlocal to include vertical sites such as music, food, sports and mom blogs.

Again, we welcome readers to play with these numbers and see what they can come up with.

Download the Hyperlocal/Framework Excel file here.

Time Inc. Buys Detroit House For Reporters To Track City

In a highly unusual decision for a news organization, Time has purchased a 95-year-old house in Detroit's historic West Village neighborhood, next to Indian Village. The home will serve as a base of operations for months -- and perhaps a couple of years -- as Time's various publications cast a unique spotlight on Detroit and chronicle its increasingly desperate struggle to reinvent itself.