NEWS: Federated Media’s Battelle Slams Rival, Hints At Investing In Publishers

clipped from: www.techcrunch.com

---

The truth is the networks have significant strategic differences. Glam owns a few properties of its own, which helped in the early days as anchor properties. Federated Media does not own any major publishing sites.

---

Glam also guarantees revenues to partners. MyYearbook is rumored to receive a guaranteed CPM on page views, and many of the blogs get guaranteed monthly payments of $10,000 or more. Those guarantees resulted in a loss for Glam of $3.7 million last year on $21 million in revenue. But it also accelerated growth and allowed them to raise a massive round of financing.Federated Media, by contrast, doesn’t guarantee revenues but is profitable. They’ve raised just $7.4 million.

---

The weak point of Federated Media’s model is that they don’t control their own publishers. If a better deal comes along, those publishers will bail - which is what happened last year when Digg left the network for a big, three year guaranteed revenue deal from Microsoft.

---

What do you mean individual sites need financing? You want to fund some of the sites you represent?
Battelle: I’m not saying that we’ll necessary do that. I’m saying that it might not be a bad idea to be ready, should that become something that those sites are looking to do. In a fast-evolving model, it pays to have a strong balance sheet.