Content to make money from online writing

WITHIN HOURS of Lady Gaga  accepting her MTV Video Music Awardsin a dress made of slabs of meat, the phrase "how to make a meat dress" is typed into Google.

Soon, there are thousands of online step-by-step instruction guides describing how you too can wear flesh-on-flesh or mimic the effect for a carnivorous Halloween costume.

Some of the articles will hail from traditional media channels, where they have been either pitched by hook-seeking journalists or commissioned by their Gaga-intrigued editors.

A large chunk of them though will be the creation of giant content mills: companies that make it their business to generate advertising-friendly online content based on the most popular search terms and then sell that on to their traffic-loving clients.

A US journalism professor has dubbed the content-on-demand sector “demonic”, others label them “digital sweatshops”, but the companies involved claim nothing to do with journalism; they prefer to think of their algorithm-based processes as a profitable science.

Populis, which has just rebranded from GoAdv, is an Italian company that bases 45 employees – about one-third of its workforce – in Dublin, where it has opened new offices on Barrow Street in the shadow of the Google building. It produces 20,000 pieces of search-driven content a month and wants to increase this to about 80,000 by 2013, focusing on the more easily monetised topics of travel, retail and personal finance.

John Slyne, managing director and chief financial officer, Populis Ireland, uses the example of a surge in searches for golfing holidays during the Ryder Cup. Populis’s editorial team will respond by commissioning more golfing holiday articles than you can shake a nine-iron at.

The content is designed to boost traffic and advertising at its wholly owned networks, which include the dotcom-era portal Excite Europe, and client sites, which include Expedia, Lastminute and eBay. Its revenues come from direct deals with these clients and from partnerships with search engines.

While Populis is the only active specialist in content-on-demand beyond the English language, its operation is small compared to US companies Seed.com (“where your content flourishes”), which is backed by AOL, and Associated Content, which was purchased in May by Yahoo. However, the company that attracts the most attention (and criticism) is Demand Media, which in August filed for an initial public offering on the New York Stock Exchange.

Demand Media was co-founded by former MySpace chairman Richard Rosenblatt. It has reported revenues of $114 million (€83 million) for the first half of 2010. It distributes its content via advice websites such as eHow, which boasts tutorials on “how to do just about everything”. It also has a YouTube revenue-sharing deal: it is YouTube’s single largest video contributor.

Words and images are cheap at content farms, which pay as little as one-tenth of what writers would typically receive as freelance journalists. The pay, which sinks as low as $15 for a 500-word article, has led content-on-demand to be dubbed “unemployment insurance for writers” in the US.

Populis pays similar rates, according to Slyne, with higher payouts for higher quality content. Video is still a small percentage of its output. “The commercial performance of video is still in its infancy,” says Slyne. However, video is a target growth area.

Overall revenues at Populis have grown from €20 million in 2007 to more than €42 million in 2009 and Slyne is projecting high double-digit growth for 2010, which points to possible expansion at its new Dublin office.

Because it does not “break” news and focuses on lifestyle topics, Populis does not see itself as a direct competitor with traditional news media. However, the central aim of all content-on-demand companies is the skill that eludes many media outlets and would, presumably, prove a valuable sideline to subsidise the loss-making provision of higher quality, time-sucking journalism.