Ex-NYT Editor’s Startup Takes Shape, Raises Business Questions
Former New York Times executive editor Jill Abramson filled in some more details about a journalism venture she’s starting with Steven Brill, saying it had hired writers and was “very close” to announcing an investor.
Abramson, ousted from the Times in May 2014, and Brill, the serial entrepreneur best known for founding American Lawyer and Court TV, have dribbled out details of their startup through a series of public appearances and media interviews. Abramson announced the still-unnamed startup during an October 2014 appearance with David Carr, the late New York Times media correspondent, hosted by Boston’s WBUR NPR affiliate. She and Brill have said it will focus on long-form journalism, stories between 20,000 and 30,000 words; that they want to host it on an existing major Internet site; that stories will be published once a month; and that they intend to charge a subscription fee of perhaps $3 or $4 a month.
Their startup, expected to be based in New York City, has generated buzz amongst journalists both because of their reputations and because they have said they plan to pay writers advances of up to $100,000 for stories.
During her keynote speech Saturday at the Power of Narrative conference at Boston University, Abramson said she and Brill “have hired some great writers to do these stories” and that they will be “fully multimedia” packages, à la the New York Times’ 2012 Snow Fall report on an avalanche that killed three people. “We’re looking at space between the 7,000-to-10,000 word New Yorker piece and a book,” she said. “The 25,000 word nonfiction novella.” She cited as an example Brill’s piece for Time magazine on the cost of healthcare, which ran 24,000 words and won a 2014 National Magazine Award.
Abramson, who is currently a visiting lecturer at Harvard, did not respond to follow-up e-mails about how the startup was funding its first stories.
Abramson told the audience the story frequency will be once a month, and that stories won’t be all investigative reports nor all first-person narratives, but a mix of story types.
“We’re very close to having a great partner,” she said. It was unclear whether their partner would be a funder and a significant media delivery platform, or just a funder. Abramson has said Brill and she are not seeking venture funding, but rather want backing from traditional media financers.
She says they hope to announce that partner soon, but did not say anything about the possible media host. Brill has said he wanted the startup to be hosted by an existing large Web media platform or platforms that would tease perhaps 1,000 words of a story and then ask people to pay for full access. The New York Times reported in November that Brill and Abramson were in talks with AOL’s Huffington Post unit. Brill last week told the New York Observer that they had almost done a deal earlier, but a partner had changed terms after agreeing to them. He said a new partner was likely to be announced in three or four weeks, or by the end of April.
It’s been an up-and-down period for media startups. Byliner, which had also attempted to run a business based on long-form journalism, ran into financial trouble and was acquired last year by Vook. GigaOm was shuttered last month. But First Look Media was founded in 2013 by Pierre Omidyar with $250 million in capital, and Vox Media raised a $46.5 million Series E round last year, valuing it at $380 million and bringing its total investment to $107 million. Vice, founded in 1994, received $500 million in investments last year, valuing it at $2.5 billion.
The potential business model of Brill and Abramson’s startup has generated debate. Mathew Ingram of GigaOm scorned the idea, arguing that they needed to charge $10 to $20 a month to make things work, and would be unable to pull in enough subscribers to sustain a business.
But Simon Owens, a media and marketing blogger, argues that the model is closer to a book of the month club. He thinks that if they can get a mere 41,000 subscribers at $3 a month, they can cover their costs; if they could get 100,000 subscribers, or 10 percent of the New Yorker’s subscription base, they should be able to generate large profits.
Abramson responded to a question about the business model by saying that while originally they planned to offer content for free and lead up to having people pay, their thinking “has changed.” She said Brill likes a subscription model, even in the digital realm, and noted that his most recent startup was Journalism Online, which created digital subscription plans for regional newspapers. That startup was sold in 2011 for about $35 million, including milestone earn-outs for executives who stayed, among them Brill. As to the final model, Abramson said, “Stay tuned.”
“The thing about a startup is it takes a long time to start up. We’ve been starting up for 7 months,” she said.