It’s nice to see blogs growing up, even if they are about babies. People.com has bought Celebrity Baby Blog, a fast-growing blog started four years ago by Danielle Friedland. She confirmed the deal earlier this week, after MediaWeek broke the story. The site has an editorial staff of 17 editors, contributors, writers, and reviewers (presumably, not all full time).
The blog is an obvious fit for People, which knows that stories about pregnant celebrities and their babies sell. (Doesn’t it seem like pregnant celebrities are on the cover of People more than anything else?). The price was not disclosed, but Friedland and staff will stay on to grow the site.
But People.com’s gain is Federated Media Publishing’s loss. With this acquisition, FM Publishing is losing yet another anchor blog from its advertising network. Last year, it lost Digg to Microsoft, and earlier this month it lost Ars Technica to Condé Nast. Now, Time Inc. (my former employer) has snapped up Celebrity Baby Blog.
Celebrity Baby is FM Publishing’s top parenting blog, and has recently started to pull in more pageviews (and thus advertising impressions) than FM stalwart BoingBoing. Since February its traffic has shot up—to 6.9 million pageviews and 720,000 unique visitors in April, according to comScore. That month, BoingBoing had more unique visitors (2 million), but fewer pageviews (3.7 million). See the chart below.
Deals like this point to the fundamental weakness of FM’s business model. When a blog in FM Publishing’s network gets big enough or gets bought, FM loses all or part of their advertising inventory. The more profitable a blog is for FM, the more likely it is to try to sell ads on its own or be taken away by a larger media company with its own ad sales force. (Disclosure: TechCrunch is also an FM partner site. They sell a portion of our ads, but we also sell our own).
That said, we hear that FM was actually very helpful in getting this deal done. It knows that its blogs can walk away at any moment (As publisher Chas Edwards told me when FM raised $50 million last month), and the only way to keep them is to deliver higher CPMs than they could otherwise get. FM also wants to be seen as the best partner for up-and-coming blogs. Generating goodwill is always a smart business practice, even if it means having to let go of a rising star.
Update: FM’s Chas Edwards got back to me. He confirms that FM helped Friedland assess the offer from Time Inc., although it did so as a favor. And although “it is not clear” what will happen to FM’s advertising relationship with Celebrity Baby Blog, he suspects that Time Inc. will take over once the current ad campaigns run out. But he says that the revenue impact of losing both Celebrity Baby Blog and the larger Ars Technica will be minimal:
We would love everybody to stay with us for life, but we realize that is not practical. In terms of a business impact, it is very minimal. No one site represents a substantial percentage of revenues.
And here are his thoughts on the importance of being a good partner, even at the end of a relationship:
I think it builds the rest of our partners’ comfort with us and the broader industry gets a better understanding that Federated Media is building almost a talent agency. We want our partners to go deep with us in a collaborative approach to building their business.
A lot of people still confuse Federated Media with an ad network. It is not just that we want to sell your ads, but we want to help you build your business and your brand. And maybe we’ll get the opportunity to participate in these exits in the future.
That’s certainly the right the attitude if he wants to keep or attract more traffic on his ad network (sorry) than will escape whenever a bigger blog graduates from FM.
Come on guys, any speculation as to a purchase price?
Ah, adding hype to a boring news story by creating a winner/loser angle to it. I likes.
Perhaps FM should start investing in the blogs they partner with.
I’m going to start something called “Celebrity Rug Blogs”
All rugs, all the time. Interviews, Exclusives, I will not lie down on this one.
kudos for FM for their CPM’s. I’, not sure that loosing one blog like this is such a huge deal though.
Blogs are good if the writers are good. I am hiring a writer to write daily articles on the home page of my social site sitespaces.net starting next week.
User created content is total crap most of the time, so you need some dedicated content producers in the mix.
I think that this is a good move, acquiring blogs like that.
AFA Federated Media, I think adverts are going to go downhill soon in general as I think that charging for no-advertising versions of websites is on the horizon with the low click rates brought on by social networking and social media.
Do you risk having a user never click on an ad for a year, or do you charge them $4.95 for a no advert version of the site and guarantee the revenue.
That’s what’s coming and that’s going to be an integral part of web 3.0
The shift away from FM and Adwords and a shift back to paid services like web 1.0 to guarantee revenue no matter who clicks what. I am pioneering that on my sites.
Any info on the price would be appreciated indeed.
Echoing others, either tell us the terms or tell us you don’t know them. Don’t just ignore the obvious question.
Any guesses on what a blog with 720k uniques is worth?
Federated media needs to do a better job with acquisition of their blogs to keep this from happening and grow their business. For every blog they lose like this they need to get probably 20 “up and coming blogs”. That is not a good growth strategy.
They have the blogs numbers and can see where they are going. Buying these blogs on the cheap when they are young and working with them to grow seems like a much better strategy then just selling ads for them. They have to either buy a portion of the blog so when its sold they don’t lose out or just buy it outright.
@ chris
the biz model you speak of has already been tried by many and failed. get with the times, ads on the web are not going anywhere. Tell me how you have more insight than the NYT and many others who have tried this
I am sure that if I tried to charge my users anything to access my content, my traffic would suffer significantly
What’s up with the two lines for celebrity-babies.com on the traffic chart? Did comScore stop tracking the month of November? And what do those [M] and [C] mean?
Congratulations to Danielle. I’m so happy to hear that you wrote about this Michael. I did as well: http://www.alphamom.com/mmb/20.....sector.php
The vast majority of parenting blogs are personal sites, not like Celebrity Babies, but rather like Dooce. To think that these blogs– which view themselves as diaries of their families histories– would be open to investment by FM Media shows a lack of true understanding of the parenting blogging space, commenters. The e-zine blogs, yes, perhaps they would be open.
@10 Chris is talking about giving the option. If people want to see advertising then its free. If they don’t they have the option to pay not to see it. This costs websites barely anything to ad this feature.
@Erick, I’m not sure why the bigger blogging sites are still sticking with FM. IMO, FM has one of the worst payout rates to publishers.. but if you have a huge blog, I’m sure they should be able to negotiate a better deals through other online ad syndicates.
Khang
I read Celebrity Baby Blog for the baby names. Celebrities are insane. I don’t really care much about them or their children, other than monikers like of Audio Science, Puma, and Bluebell Madonna. There was a rumor earlier today that Angelina and Brad may name the twins Amelie Jane and Isla Marcheline, and I was beaming over the possibility (after Maddox, Zahara, Pax, and Shiloh, that would be a huge leap into the world of sanity).
**waves hello to TechCrunch intern Peter**
@ Khang
FM gives publishers 60%, while doing ALL sales, collections biz dev etc… all while delivering some of the highest CPMs around. Can you name another rep firm that
1) only keeps 40%
2) has a CPMs over $5
Ad networks typically keep 40% - 60% of revenue and yield sun $2 CPMs if the pub is lucky.
@ Chris and Sports Tech,
It may be easy and cheap to implement, but the model only works if enough people subscribe. Which in most cases as been proven that not enough subs can be acquired to make such a program successful
@17,
I didn’t say its a business model. Its an option. You get incremental revenue from the people who sign up and you still sell ads for the majority that don’t.
Come on….lets have a price, little disappointed it is just ignored in the original piece TC =
David
why don’t you throw out a price instead of complaining that TC did speculate on the price. Time has no obligation to make public the purchase price unless it is a significant portion of their market cap. In this case, they don’t need to.
so how about Dave?
I can confirm that the blog was acquired for $8,000,000
@ Martin
You say you can confirm the purchase price. Please Do.
Please give us a legitimate source, so we know that you are nit blowing smoke up our asses
this shouldn’t be hard based on you comment above
7 million page views
low = $3 cpm = $21k pm or $252,000 pa
med = $6 cpm = $42 pm or $504,000 pa
high = $10 cpm = $70k pm or $840,000 pa
v.high = $15 cpm = $105kpm or $1.26 mill pa
x10 revenue, ergo range of 2.5 million to 11.26 million
@20 - Now that is exactly why i didn’t bother, I am neither good at it or paid to do it.
@ Dave
My point is, none of us are good at “guessing” valuations. Even the mighty TC and it’s staff of crackerjack reporters (errr Bloggers).
Although, don’t be so hard on yourself Dave. According to #21, you did were right in there with a decent estimate.
A celebrity baby blog on a technology news site? How many in the tech community follow britney spears’ kids? Also a blog about celebrities raising babies seems mis categorized as parenting advice.
How many digs does it take to break a relationship? You’ve done at least 3 posts trashing federated media. Are you trying to get better ad rates, launching a competing ad network or are you shorting their business in some way?
@25
“A celebrity baby blog on a technology news site? How many in the tech community follow britney spears’ kids? Also a blog about celebrities raising babies seems mis categorized as parenting advice.”
Who really gives a f**k about the content, it is middle of the road piece about a business being sold, get over yourself.
“How many digs does it take to break a relationship? You’ve done at least 3 posts trashing federated media. Are you trying to get better ad rates, launching a competing ad network or are you shorting their business in some way?”
How is this post trashing FM, if anything this is a great bit of marketing for them, if I was John I would be really happy.
@ #5 Chris, no way. Maybe for bigger ad buys where they only care about branding, but with smaller stuff like what we sell advertisers convert, really well. on niche sites there’s still great arbitrage opportunity.
@23…if you can get 10x, good luck to them for a blog with predictable traffic growth and no tied in earn-out.
So, what will Arrington sell Techcrunch for?
@23
1) You are assuming 100% of the inventory is sold directly, not thru remnant networks. Never happens. You’re lucky if 50% is sold directly.
2) The *average* CPM is nowhere near $6. When you factor in remnant, it’s more like $2.
3) 10x revenue is at the high end of the range, but we’ll use it. Uniques is also a major factor.
$2 x 7k x 12 x 10 = $1.68mil