In the race to build a better blogging business model, GigaOm is hoping to sprint into the lead. On May 28, GigaOm Network said it will start selling subscriptions alongside the site's existing free, widely read tech blogs.
For $79 a year, the new GigaOm Pro will offer access to premium content, including research reports and long-form stories in such areas as wireless technology and cloud computing.
GigaOm is at the forefront of a push by bloggers and other online information providers to find new ways to generate revenue as demand for online advertising slumps. Online ad revenue at the four largest Web portals, Google (GOOG), Yahoo! (YHOO), Microsoft's (MSFT) MSN, and AOL, fell 3.3% in the first quarter, according to consultant eMarketer. Newspapers and magazines are under even greater pressure as their circulation numbers dip and print ad sales plummet.
Ad sales rose in the first quarter for closely held GigaOm, says Paul Walborsky, CEO of Giga Omni Media. Still, the site is hedging its bets. "We believe that new media companies out there are going to have multiple revenue sources," he says. The company, which boasts about 3 million unique visitors to its site a month, also makes money from coordinating industry events. GigaOm provides blog content to BusinessWeek.com.
Information providers have a mixed record in getting users to pay for online content. The Wall Street Journal is one of the few newspapers that charges a subscription for online content. Others, including The New York Times, have ceased charging readers for access to some content.
Murdoch: time to "pay handsomely"
The Wall Street Journal is looking to expand paid offerings. In a May 6 earnings call, Rupert Murdoch, CEO of Journal owner New Corp. (NWS), said his company will start charging users for access to the newspaper via Apple iPhone (AAPL). "In just three weeks, 360,000 people have downloaded The Journal's iPhone mobile reader," he said. "As you can imagine, we will soon be making them pay handsomely for the privilege of accessing the world's best business news source." Murdoch also said he is weighing whether to charge for online access to other News Corp.-owned papers, such as The Sun and The Times of London.
According to the Associated Press Managing Editors survey published on May 12, 28% of the 351 newspaper editors who responded said they are considering charging for online content. The papers are looking to monetize their own sites, making content available through e-book readers and cell phones and through new aggregator sites. Announced in April, Journalism Online plans to sell content—be it a single article or an annual subscription—aggregated from various news sites.
The move into paid subscriptions might pit GigaOm Pro against larger, established industry researchers such as Gartner (IT) and IDC (IDC), which have long sold paid research reports online. GigaOm Pro also will offer longer stories from staff writers examining industry trends, weekly industry updates, and links to relevant stories found on other sites.
GigaOm Pro will feature regular reports from a stable of 10 analysts that includes independent wireless expert Chetan Sharma, tvstrategies principal analyst Steve Hawley, and Clint Wheelock, managing director of Pike Research. Sharma says he expects to write at least one long report for the site every two to three months, adding that "GigaOm has a strong following in the marketplace and a good brand."
Kharif is a senior writer for BusinessWeek.com in Portland, Ore.