Kara Swisher

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Demand Media Is Mad as Hell and, Well, Pens a Manifesto (And Here It Is!)


Demand Media CEO Richard Rosenblatt said he has had it with some mainstream media depictions of his social media content company, especially one report that called it a “content mill.”

So, what did he do? Well, he wrote a manifesto, of course!

“There has been so much misinformation about our model and what we actually do, that I thought it was a good idea for our company and those who work for us to lay out our principles,” said Rosenblatt in an interview with me last night. “We are so different from traditional journalism, which I have nothing but admiration for, so it was time to make people understand that.”

The role of Demand Media, said Rosenblatt, is to help readers solve problems, laugh and get good advice, while figuring out how to create a profitable media business in the digital age.

The longtime serial entrepreneur has raised an eye-popping $355 million to do so at the Santa Monica, Calif.-based Demand, which seems to be aiming for an initial public offering or merger with another company–AOL (AOL), perhaps?

Demand has also been eyed by Yahoo (YHOO) and others for acquisition in the past.

Rosenblatt is tight-lipped about all this, but not about what he considers twisted reports about Demand.

“What is wrong with coming up with a way for thousands of writers–who have been laid off, by the way, from news organizations–knowing exactly how much they make, selecting their own topics and publishing when they want?” asked Rosenblatt. “We’re trying to find a new and innovative way to make content.”

In fact, I agree with Rosenblatt (and some Demand writers do too), because Demand Media content is simply the basic how-to guide of service journalism that really has nothing to do with the investigative work that media giants are finding it harder to fund.

And Demand’s success has almost nothing to do with creating or fixing that problem. Demand is, of course, an easy target for a snarky takedown, but is entirely beside the point if you want to really talk about where serious journalism is headed.

In fact, Walt Mossberg and I have invited Rosenblatt to share the stage at the eighth D: All Things Digital conference this June, along with former Wall Street Journal editor Paul Steiger, who is trying to save investigative journalism at a nonprofit called ProPublica, to talk about it all. (You can see Steiger talking about this subject here.)

Until then, here is the manifesto, as well as a video of an interview I did with the smooth-talking Rosenblatt in mid-2008 and a spoof music video Demand made to attract writers:

The Demand Media Manifesto

From the very beginning, we set out to create an entirely different kind of media company. Now that our rapid growth has demonstrated our approach works, people have noticed our success, and they are talking about us. We’ve been listening. And we’ve seen all shapes and sizes of feedback about our business–everything from investigation to imitation, from congratulation to condemnation–all of it essentially trying to figure out what makes Demand Media tick. So let’s get right to the point. Here’s what makes us tick. Here are the principles that have always governed how we run our business, make it grow, and make it great for the Internet.

Start each day listening to the customer.

We believe that consumers tell you exactly what they need–if you’ll just take the time to ask or listen. The Internet is the world’s greatest market research platform; so we immerse ourselves in the billions of signals of consumer demand that it provides each day. While more traditional media companies focus on supplying experiences they believe consumers might like, we’re unapologetically dedicated to delivering the ones they already demand. This core trait guides the content we create, the social applications we develop, and the communities that we nurture. It’s incredibly liberating to operate this way, knowing that everything we do satisfies the real world interests of over a 100 million consumers each month.

Make content that is unequivocally useful.

We love the Internet because it allows us to improve people’s lives in large and small ways–every single day. So we create content that solves problems, answers questions, saves money, saves time and makes people laugh. Consumers become attached to us because we have helped them manage their diabetes, find a rewarding job, plan the perfect family hike, fix a cranky garage door or shave the last five strokes off their golf game. We aren’t here to break news, lay out editorial opinion, or investigate the latest controversy. Our target audience tells us they want incredibly specific information and we deliver exactly that–in a style that the average consumer appreciates and understands. So, while we love to read The Economist, The Washington Post and Wired–we have little in common with their missions or business models.

Build superior web experiences.

While our approach to content creation has captured widespread industry attention, the bigger story is the rabid fan base and rapid growth of our core media properties. Paying careful attention to the consumer has led to the development of category leading sites like eHow, LIVESTRONG.com, Cracked, Trails, GolfLink, and Mania. These are destinations where members return each day to learn, share and interact with compelling programs that include some of the most popular applications for the iPhone and Android. They research. They discover. They make friends. They buy the official t-shirt. They’re getting what they want. Demand Media’s content is very much at home on award-winning websites where engaging social applications and passionate audiences combine into an experience that visitors crave.

Invest heavily in our professional freelancer community.

Most consumers initially encounter Demand Media through the online brands fueled by our large professional freelancer community. We know that a quality experience begins and ends with these qualified professionals, so we expend extraordinary efforts to attract, serve and nurture the right people. Choosing from hundreds of thousands of assignments each day, our freelancers enjoy interesting work on the widest variety of topics and are paid twice a week. We transparently pay a range of rates for various roles and assignments, and we generally target an hourly rate comparable with the average salary of a journalist. We’ve even created a program that enables frequent contributors to gain access to affordable health insurance and a grant program that helps them pursue their creative aspirations. We don’t think these practices are necessary to have a good creator network; we know they’re necessary to have the best and biggest professional creator network. Now operating as a vibrant community of peers, our creators tell us that we’ve put a new kind of freedom into freelancing–freedom from the tyranny of pitching for every assignment, chasing invoices and waiting months to get paid–and all the other frustrations that waste their time, and never earn a penny.

Insist on being profitable.

A business mission is sustainable only when you are profitable. Making money allows us to attract the best employees, content creators and investors–and grow the business to match our vision. But Demand Media is native to the Internet. So we don’t have the crutch of an off-line business to subsidize what we do. We don’t believe our target consumers will pay for Internet content. And advertisers have told the world they are fed up with soft promises and underperforming campaigns. Put simply, to be profitable we must be truly excellent at what we do. On a daily basis we translate this mandate into a repeatable approach that gives users exactly what they want, attracting an audience that advertisers desire and that can be delivered with a sustainable cost structure. Some people act like this is revolutionary, or even heretical. We think it’s just common sense.

Never rest.

We are just getting started. There are nearly limitless opportunities to serve consumers in places we don’t reach well today, including mobile, social networks, and international markets. There are dozens of attractive vertical niches we don’t even attempt to cover. There are thousands of big companies still trying to figure out social media. Our technology and algorithms today are doing a fraction of what we know they can accomplish tomorrow. Our burgeoning content creator network is really just learning to work this way. We believe the opportunity to create life change and business impact through the Internet is bigger than ever. Consequently, we don’t see what we have accomplished; we see what have left to do.

The critics are outnumbered. For every one of them, there are millions of consumers, satisfied and returning to our award-winning sites. For every skeptic, there are hundreds of content creators who go on record saying Demand Media is a hero for them, their families and their careers. Demand Media employees, content creators and end-users are pouring themselves into profoundly and positively changing the shape of online media–in a world that has almost given up on this idea. Unlike many around us, we aren’t worried about the future of the Internet because we are too busy trying to create it.

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There’s a lot of attention and PR around Marissa, but their product lineup just kind of blows.

— Om Malik on Bloomberg TV, talking about Yahoo, the September issue of Vogue Magazine, and our overdependence on Google