Global and regional business models for blogging: Allure licenses Gawker titles

An article in today’s Australian title Network expects blogging to pay off notes that Allure Media, an Australian blogging network, will next week launch its fourth title, the gaming blog Kotaku. After the initial story being posted by Phil Sim in February, Allure launched Australian versions of the Gawker Media sites Gizmodo and Defamer, with Lifehacker being launched last week. All four blog titles are licensed from Gawker, meaning that blog content is reused or created under the supervision of local editors, and any visitors from Australia to the main Gawker Media sites are redirected to the local sites.

This model provides additional monetization by Gawker of their properties, traffic from the outset for the Australian blogs, and hopefully then scalability of advertising sales to encompass purely local initiatives. I’ve written before about the challenges of creating blog discussions in smaller English-speaking (or Spanish or Chinese-speaking) countries, when conversations usually get drawn back to the dominant country’s population. In addition, it is harder to monetize content in smaller economies. Allure’s approach, depending on the licensing terms with Gawker, can provide a balance between avoiding having to create all the content required, while making that content relevant to a local audience. The remaining issue is whether sufficient advertising can be sold, particularly to Australian corporates and media buyers which in the main still haven’t got their heads around blogging. Certainly the model can be applied in other media markets in adapting local content for media globalization.

Allure is owned 92.5% by web investment firm Netus, which is in turn primarily funded by News Corporation. Netus’s Craig Blair is quoted in the article:

“Our main focus right now is turning Allure Media into the premier blog publishing business in Australia, and that’s by generating interesting content and proving we can monetise (it) through (media) agencies,” MrBlair said.

“For advertisers, this is a really good way of getting niche audiences. We’ll expect a business like Allure Media to break even within 12 months.”

It will be very interesting to see to what degree this enables the development of an advertising-supported blog sector in Australia, by making it perceived as a mainstream media outlet for the first time.

iluvmeida

I think there is huge potential here. Its interesting looking at UGC (cost) models out there. There’s the model where people create content and submit it in hope that the wider audience provides feedback, then there’s the model where people submit and know they’re getting good editorial feedback. It’s been commented that the former is cost effective, however if you’re a branded product, the money spent in paying people to sit and review submitted material (which I think will grow over time as this area is relatively unregulated)is already prohibitive. Why not put those monies into full-time editorial where users know they’ll get a response and where editorial will also be able regulate immediately instead of having to deal with it through the courts? Bogs are a no-brainer.