Just as Johannes Gutenberg's printing press brought books to the mainstream public in the 15th century, Tim Berners-Lee's World Wide Web brought commercial publishing to the people.

Blogging

Blogging not only allowed anybody to publish easily to the Web, it ended up shaking up the print media world.

Blogging began in the 90s as a form of online diary - Rebecca Blood wrote a good pre-history in 2000. One of the early popular blogging services was Blogger.com, launched by Evan Williams (who subsequently became a co-founder of Twitter) and Meg Hourihan in August 1999. The service was acquired by Google in February 2003, a couple of months before ReadWriteWeb began. At that point, 2003, blogging was still seen as an informal diary-type of publishing.

Around 2004-05, blogging started to become accepted as a legitimate news source. This was around the time that ReadWriteWeb began to publish tech news, as well as analysis.

By the end of the decade, many blogs were directly challenging newspapers - proving that a solid news brand, such as Huffington Post, can be created from almost nothing in a few years.

RSS

Blogging software was one part of the democratization of media. RSS ("Really Simple Syndication") was another. There were and still are different versions of RSS, created by Dave Winer and others. But whatever the flavor, syndication has had a major impact on media.

Basically RSS allowed people to subscribe to updates from blogs and other publications. Using RSS Aggregators, people could read news from a selection of niche and general news publications.

Blogs were the first to utilize RSS, but mainstream media followed during the 2005-06 period. Today it is very rare for a major news website - whether it be the New York Times or a leading blog - not to use RSS.

Twitter & The Real-Time Web

The next major development in news media occurred towards the end of this decade. It was of course Twitter and the Real-Time Web.

To be fair, this has challenged not only traditional media - but blogs as well. Now anyone, whether they're a writer or not, can publish 140 characters to the Web. And it might end up as breaking news, as the Hudsen River plane crash proved earlier this year.

Media in the Next Decade

There is much talk of the mainstream media "dying" and blogs usurping traditional media companies like the New York Times. While it's true that blogs sometimes report breaking news stories or analyze them better than newspaper websites, I'm a big believer in the power of brand. Washington Post, Wall St Journal, New York Times - these are all powerful brands and they reach a much wider audience than the vast majority of blogs.

The challenge of course for mainstream media is to (drastically) reduce their costs, because few people want to pay for content these days - news or otherwise.

However, in my view the traditional news media industry is in much less danger of extinction than the music industry. Musicians can bypass record labels completely nowadays, but there will always be a need for news to be questioned, put in context and analyzed. The best media publications of the next 10 years will do that and be successful, the ones that don't will fade away.

See also: Top Internet Trends of 2000-2009: Online Music

In this follow-up post, we look at the type of content that Demand Media outputs. It turns out that much of it is driven by advertising demand. Again we feel compelled to ask: is this good or bad for the Web's future?

Service Journalism

Demand Media claims that its content is not journalism. However, it does compare its model to service journalism (a.k.a. "news you can use"), a concept rooted in the 1960s and common in lifestyle magazines such as Good Housekeeping. This is content such as tips and feature articles about fashion, food and travel.

Demand Media told us that it aims for "useful, usable content." The content it produces has an "evergreen quality" to it, they say.

CEO Richard Rosenblatt told me at the Web 2.0 Summit last month that Demand Media will be syndicating content more to traditional media properties in 2010 and beyond. They see 'service journalism' content as being complementary to not only magazines, but large portal sites like Yahoo.

An interesting observation from Rosenblatt was that Demand Media content is "very similar to Associated Press content." In other words, it "helps fill the pages" for newspapers, magazines and other media properties.

Matching Content With Ads

What may be more controversial is that Demand Media makes no bones about their content being produced in order to put ads around it. OK, almost every online publisher has a similar objective: to make money with contextual ads. ReadWriteWeb makes most of its revenue from online advertising.

What's slightly different here is that Demand Media is custom producing content in categories where there is strong advertiser interest. A specific example of that is a YouTube ad program with Target that is currently running. In this channel based around holiday consumerism, content created by Demand Media is featured side-by-side with advertising. Below is a screenshot showing an eHow video entitled "How to Make Cornbread Stuffing," with a Target ad to the right.

Demand Media told us that advertisers are crying out for new content to advertise against. If a large media network like Yahoo is looking to "create content with ads," the next step for Demand Media is enabling their customers to "order content with ads." An example might be something like this: Demand Media produces a how-to article on playing tennis; then sells it to a Yahoo sports site accompanied by tennis equipment adverts placed around it.

Conclusion

Is what Demand Media is doing much different from mainstream media publications or blogs?

One difference is that ReadWriteWeb (along with many other online publications) is a journalism business, so we strive for editorial independence and there is a 'church and state' line with advertising. Demand Media isn't journalism in the traditional sense - that isn't the reason for its being and the company freely admits that. Demand Media produces content to make money, it's as simple as that really.

What do you think: is what Demand Media is doing just a natural extension of contextual advertising? Or is it crossing a line where content is too married to advertising?

In this follow-up post, we dive deeper into Demand Media's content production model - and ask questions about the quality of the output.

Will Demand Media Soon be a Household Name?

In our previous posts, we've noted that Demand Media is rapidly rising up the comScore list of the top 50 web properties in the U.S. - in July it was #24, in September it was #15. At this rate, Demand Media will soon be one of the top 10 Web properties in the U.S. - right up there with Amazon, eBay, Apple.

Think about that: how many of you had heard of Demand Media before this year? Amazon, eBay and Apple are all household names. Demand Media (along with another fast-growing mega content site, Answers.com) could be a household name soon too, if its current growth rate continues.

Behind this remarkable growth is a very large output of content each and every day, fueled by thousands of freelance writers and content creators.

So how does Demand Media produce so much content every day? 4,000 new articles a day is a quantum leap above the 20-30 new posts a day that the most feverish of professional blogs pump out.

About Demand Studios

Demand Media produces so much content with a system it calls Demand Studios. It's a proprietary editorial system which is part human-processed and part automated.

The system starts with an automated process, crunching data and running it through an algorithm to identify story ideas that have the best chance of success. The algorithm factors in audience type, ability to attract advertising and potential for traffic.

For a written piece of content, human editors will then check the top story contenders. Potential titles are placed into a pool for writer selection. Once a writer picks up a story, it gets written up, goes through a fact checking and copy editing process (including a plagiarism check), and finally the editorial team approves the completed article. The article is eventually published and the writer gets paid.

This is a simplification of the Demand Studios process, which happens 4,000 times every day! The system appears to be an efficient mix of automation and human labor. As we'll see on Page 2 of this post, the editorial process isn't foolproof. But even so, the scale of this system is impressive.

As at the end of October, Demand Studios had created more than one million original pieces of content, both text articles and videos. There are more than 6,000 active Demand Studios freelance creators - including writers, filmmakers, title proofers, copy editors.

In my meeting with Demand Media executives at the recent Web 2.0 Summit, I was told that an average of 11 people - and 15 unique roles - touch a piece of content as it flows through Demand Studios. The company argues that this, along with community rating of content, produces quality content.

But does it, actually?

Next Page: The Quality Question...

Demand Media: Is This Really Quality Content?

Demand Media is sensitive to criticism of the quality of its content. It's a question that ReadWriteWeb has raised a few times and which Wired picked up on in its October profile.

At the end of that article, Wired noted that Demand Media is "trying to place a new emphasis on quality." However it concludes by saying that Demand Media is "not moving far from [the] Henry Ford model."

I asked Demand Media CEO Richard Rosenblatt about this criticism. Bristling, he responded by pointing to two things.

Firstly Rosenblatt claimed that many of Demand Media's content creators are professionals. He said that 75% of them have been published in magazines or newspapers, 25% have written a book, and 25% have held professional marketing roles.

Example of Demand Media content, on Yahoo! network site 'Shine.'

Secondly, Rosenblatt noted that Demand Media content creators have choices in the market - but they choose to work for Demand Media.

What's more, Rosenblatt said that "quality is based on relevance" - a quote he attributed to Wired editor Chris Anderson, who wrote the books The Long Tail and Free.

Who then are these people that write and shoot video for Demand Media? They're professional freelancers and they're paid anywhere from $15-30 per piece of content. This isn't a great deal of money for a freelance article. But according to Demand Media, there are hundreds of such freelancers earning thousands of dollars per month from Demand Studios (although this would be the top of the range).

4,000 New Articles Per Day - What Percentage is High Quality?

The trouble with the term 'quality' is that it's both variable and subjective. I've seen examples of Demand Media work that are poor - e.g. this eHow article about how to get Twitter followers.

Step 3 reads as follows:

"Engage in discussions. If someone on your timeline says something interesting or says something that you can put input into, do it. There's nothing worse than Twitter followers who follows for no reason. Even if you don't get responses some of the time, it doesn't hurt to try and the people you're following will know you're attemption to converse and are more likely to follow you back."

There are a couple of bad typos in that paragraph (where were the copy editors?), but worse is that the advice is mediocre. It's relevant content to many people, but is it good content? Apparently it was to the people who've read it, as it has 5 stars...

UPDATE: Demand Media contacted us to explain that above article is what they call a "user-generated article." This is marked in the screenshot below as "user submitted article," whereas a Demand Studios article would have "eHow Contributing Writer" as the attribution. Demand Media advised that "this UGC does not flow through the full Demand Studios editorial process - and is not counted in our 4,000 pieces of content."

The bigger question is: there are surely many examples of good Demand Media content on the Web, but how many of the 4,000 articles it produces every day aren't?

As we posited in our previous article, the concern with fast-growing content factories like Demand Media and Answers.com is that quality is taking too much of a back seat to quantity. Let us know your thoughts in the comments.

In our next post, we will look into the type of content that Demand Media is producing - and what it plans to do with it next.

See also: our follow-up analysis of Demand Media, Ad-Driven Content - Is it Crossing The Line?

Is the fact that these sites produce so much content, and are quickly gaining in popularity as a result, cause for concern about the future of the Web? Will it lead to the same uniformity and lowest common denominator content that afflicts the television industry?

Answers.com Rolling in Page Views, Money

Answers.com, which we reviewed in August, garnered 56.4 Million monthly unique visitors in the United States in September (83M worldwide). For context, that puts it on a similar level as CBS Interactive (#12 with 58M uniques in U.S.) and Apple (#11 with 60M). Demand Media, which we also reviewed in August, was close behind with 52.5M uniques in September.

Answers.com announced its Q3 2009 financial results today. It made $4.99 million in revenue in that quarter, including $1.9M in September alone. The Q3 09 result was an increase of 40% compared to $3.56 million in Q3 2008. Most of the 09 revenues were from WikiAnswers, which reported $3.42 million in Q3 2009 - an increase of 75% compared to $1.96 million in Q3 2008.

WikiAnswers is the main reason for Answers.com's popularity. It is a Q&A site driven by user-generated content. And it's growing fast. Bob Rosenschein, Founder, Chairman & CEO of Answers.com, left a comment on our earlier post saying that "the growth in our traffic is almost entirely from our WikiAnswers site."

In September, WikiAnswers garnered 46.3 million U.S. unique visitors and ReferenceAnswers 21.4 million U.S. unique visitors (note there is some crossover between the two sites, hence those numbers are greater than the unduplicated total of 56.4M).

Low-Cost Content Production On A Massive Scale

There are two interesting aspects to the success of Answers.com. Firstly, it has a huge number of pages on the Web now: 38 million as of today. Much of that is user-generated content, so very low cost.

Secondly, Answers.com's page view and financial success is almost entirely created off the back of Google. Indeed, Answers.com announced recently that it has renewed its Google Services Agreement - extending its access to Google AdSense for two more years. Bob Rosenschein, CEO of Answers.com, is quoted as saying that "we earn the vast majority of our ad revenue from Google's sponsored links."

Now consider the implications of this for the future of content on the Web. The recent rapid ascensions of Answers.com and Demand Media can only really lead to one conclusion: to succeed in the content business on the Web, you should pump out hundreds of pages of content every day - preferably thousands.

Now, this is nothing new. We've known for a long time that blog success is more easily gained (gamed?) by producing far more posts per day than any one person can read. This has led to many professional blogs competing with each other on how many posts they can put up every day - usually accompanied by a slide in quality.

As well as producing as much content as possible, Answers.com and Demand Media also have a low cost structure in common with blogs. But they are taking the 'quantity rules' approach to a whole new level. This is low-cost content production done on a huge scale.

Just how much content do these two sites have on the Web? There's an easy way to find out: search Google. Here is the amount of content each has, along with some other sites for comparison:

• wikipedia.org: 56,000,000
• answers.com: 37,700,000 (of which wiki.answers.com accounts for 34,100,000)
• nytimes.com: 13,200,000
• washingtonpost.com: 12,500,000
• ehow.com: 4,850,000 (this is Demand Media's lead site)
• huffingtonpost.com: 4,740,000
• mashable.com: 210,000
• techcrunch.com: 124,000
• readwriteweb.com: 37,700

Answers.com has nearly 38 million pages of content on the Web. Much of it is discovered via Google; and monetized via Google. Wikipedia still has more content, but it is a non-profit world encyclopedia. Answers.com is a commercial company, out to make money.

Demand Media is well behind Answers.com (and Wikipedia), but there's reason to believe it will ramp up fast. In August the company told us that it produces 2,000 pieces of content per day, across its network of sites [Update, 7 Nov 09: it's now 4,000, Demand Media told us]. It also has a slick content production 'studio' system, which we will explore in our next post.

Interesting to note that Huffington Post is really the closest the blog world has to a player in this 'mega content' space - but then most of the site's content comes from aggregating it from other sites. Huffington Post has been criticized by the New York Times in particular for this practice.

Note that the New York Times and the Washington Post clearly both have a lot of content too - but they also have a lot of well-paid staff. Answers.com and Demand Media are producing content at a fraction of the price that the NYT and the WP pay for it.

The Age of Mega Content Sites - Where Is This Headed?

On the Web, traditionally success has been measured by page views. This isn't always the case - there's certainly a place for quality over quantity, a philosophy which we at ReadWriteWeb firmly believe in! But by and large, big page views usually means big revenue... or at least the promise of it (e.g. in Facebook's case).

Both Answers.com and Demand Media are onto a good thing. They have different approaches - Answers.com is largely user-generated content combined with Wikipedia and other sources; Demand Media has created a low-cost content factory, by employing thousands of freelancers.

Google is largely keeping both companies in business - it is the source of most of their traffic (because a lot of it is reference or resource content) and certainly in Answers.com's case it provides the bulk of its revenue.

I can't help but think that the rapid rise of these two companies may be bad news for the Web. If a small number of companies come to dominate a content market, usually blandness and lowest common denominator fare follows. The network television and radio markets in almost any country in the world are evidence of that. Likewise, if you search Google for a reference article and the first page of results is littered with Answers.com and Demand Media articles, is that crowding out the real topic experts?

Are these mega content sites a good or bad thing for the Web? Is quality taking too much of a back seat to quantity? Let us know your thoughts in the comments.

At the time of the sale, Newsvine was promising to integrate some of those web 2.0 features into the main MSNBC properties. CEO Mike Davidson told ReadWriteWeb in 2007 that "over the next few years, Newsvine technology and content will make its way onto msnbc.com, and vice-versa where it makes sense." Has that actually occured? Let's check in with Newsvine to find out.

Newsvine is a "Citizen Journalism" site; a news publication built using the voices and recommendations of ordinary citizens. It also syndicates content from its parent company MSNBC, Associated Press and others. Newsvine has a lot in common with social news sites like Digg and Slashdot - only it has more mainstream topics.

Slow Development, But Keeping Abreast of Trends

What's new at Newsvine circa 2009? There is nothing overly different from what we saw in 2007, but the site continues to look elegant and is still packed with social features.

Newsvine appears to have kept up with current trends - we noted today a Real-Time Web feature, called Newsvine LIVE. This is a rapidly scrolling view of emerging stories, displayed as a pane on the right-hand side of the homepage.

However as with many startups that get acquired by big companies, the pace of development at Newsvine slowed considerably after being bought. A scan of the Newsvine blog this year doesn't show much development. There was some administrative work done on groups and a hook-up with Facebook. Not much else is noted in the blog, although Newsvine has been active in developing widgets for sites like Netvibes and Yahoo.

Mike Davidson blogged in August that "things, for the most part, are going swimmingly [at Newsvine]." He admitted though that "building technologies and services for msnbc.com has slowed our development efforts on newsvine.com a bit, for the time being."

Traffic: Steady

When we last spoke to Newsvine, in July 2007 just prior to its acquisition, Newsvine was getting about 1.2 million unique visitors per month. It was said to be growing at an average rate of 46% per quarter. The top topics in Newsvine in mid-07 were Politics and Technology, echoing the popular topics in the blogosphere of that time.

Traffic over the past year at Newsvine has been fairly flat, at least according to Compete - which puts the US unique visitors at around 1.2 million and shows little growth.

However in an August 2009 post, Newsvine CEO Mike Davidson claimed that Newsvine now gets "over 4 million uniques a month." So perhaps Compete's statistics are too low (which wouldn't be the first time).

Conclusion

All seems fine and dandy at Newsvine, despite slow development of new features on the site.

However, as yet there is little evidence of Newsvine functionality on MSNBC sites - certainly the readers don't contribute much content to them. Hopefully we see more of that over the coming year, as Mike Davidson did say integration would occur "over the next few years" back in 2007.

Overall, it's good to see that Newsvine's community is still relatively vibrant. As of time of writing, a story entitled 'Dick Cheney was a Lying, Treasonous Coward' has 239 comments. Evidence that it is an MSNBC site after all!

Although Netflix will try to make a streaming-only service work abroad, the company really doesn't think there's a demand for this type of offering within the U.S. In fact, when responding to a reporter's question regarding Netflix's plans for an a la carte option (there isn't one), Hastings said that while they're "open-minded to" an a la carte service that came without the DVD option, the company hasn't seen much interest in something of that nature in the States. "Everybody also wants to get DVDs," said Hastings. "All the new releases are on DVD, the vast catalog is on DVD. When there is demand, it will make sense for us to meet that demand for streaming only."

...But There is Demand for Streaming-Only

While that may be true - people do want the new releases - the demand for the physical media is arguably an artificial one created by the entertainment industry. Studios simply refuse to offer their movies and TV shows via Netflix's on-demand streaming library until they've been able to pull in a nice profit from disk sales first. This, in turn, forces consumers to not only purchase but also desire the DVD-by-mail part of the Netflix service as opposed to a separate, unbundled option of on-demand content only.

In other words, to say that the demand for streaming-only doesn't exist isn't exactly accurate. After all, Netflix reported that their streaming stats are now at an all-time high with 42% of subscribers having streamed at least 15 minutes of one TV show or movie during the last quarter. This number is up from 22% during the same period last year. Considering that Netflix's subscriber base itself has grown 28% over the past year, this figure means that the raw count of subscribers actively engaged in streaming has now more than doubled over last year. Hastings even said himself that the numbers were "a good marker of increasing streaming adoption."

Although the demand for new releases would probably have many subscribers sticking with the hybrid DVD/streaming service, by forgoing a streaming-only option it seems that the company is overlooking an opportunity to pick up a sizable group of more casual users. There are likely a number of people who would appreciate the option to pay a little less in order to to gain access to the on-demand content only - content which includes a much smaller catalog than what's available by mail. Given the company's integrations into game consoles, set-top boxes and even some TVs, there's actually no need to even own a DVD player anymore to watch Netflix movies. The content is on-demand.

Streaming media is the future, not physical disks. Hollywood knows this too, but as with the music industry, they're fighting tooth-and-nail to keep the old business model afloat for as long as possible. So far, it's working. As long as they control the method of distribution and keep it limited to physical media it will look like DVDs are what the people want. But the people really want streams. From music (Pandora, Spotify) to TV (Hulu, iPlayer) and yes, to movies via Netflix, streaming media is rapidly becoming the method of choice for many of today's consumers. The future is an on-demand world and Hollywood would do better to figure that out now than try to delay the inevitable.

The app lets you listen to the movie's sound track, see photos, watch trailers and best of all - interact with an on-screen image of the monster Carol. Carol can be tickled, hit, he'll throw things at you, you can put him to sleep at night and he'll eat photos of the contacts on your phone.

Either way, there's something I think all of us can enjoy about listening to Karen O sing in the background while watching a big cuddly monster eat photos of people we know from our phone.

Now in its 4th year, the Knight News Challenge has funded 35 news projects so far. The rules of the contest have changed this year in response to one of the biggest complaints of the past: projects can now be submitted privately to Knight judges and not be exposed to the public at large.

How has Answers.com achieved this stellar growth? The same way Demand Media has: sheer quantity of content.

UPDATE: Bob Rosenschein, CEO, Answers.com, left a comment on this post with some illuminating data points. He first notes that the majority of page views comes from WikiAnswers.com, which had 22M uniques in July '09 while Answers.com had 10M "with some overlap." What's more, he notes that "the growth in our traffic is almost entirely from our WikiAnswers site."

Answers.com is run by Answers Corporation, which also has Q&A site WikiAnswers.com in its stable.

How Answers.com Works

In some ways Answers.com is the same as Demand Media - both output huge amounts of practical, useful reference content. This content attracts Google's spiders, which is a big part of the success of both companies. That's probably where the similarities end, because Demand Media largely produces original content. Answers.com, on the other hand, is basically a giant aggregator of third-party content.

The difference was noticeable in an example query I did for both sites: what is an rfid chip? The eHow page on RFID chips was short, basic, uninspiring content. The result on Answers.com was a long, thorough article about RFID chips. Impressive... except the content is actually from Wikipedia. If you scroll right to the end of the page, you will see a single sentence acknowledging this. But most people would probably be unaware that it's not original content. Why? Because this Answers.com article is peppered with links to other Answers.com pages. This of course is great for SEO (search engine optimization). UPDATE: Answers.com CEO Bob Rosenschein commented that "we put a no-index on pages which contain only Wikipedia content, so that they do not even show up in Google's index."

Answers.com's modus operandi boils down to this: use content from other sources, judiciously replace all of the links to point to their own domain, and reap the page views that result from Google. It can use Wikipedia content so liberally because it is licensed under Creative Commons.

The Secret to Success: Millions of Pages Indexed by Google

Answers.com has a staggering number of pages indexed in Google: 31.8 million! This is only 11 million less than Wikipedia (currently 43.1 million). By comparison, Demand Media's eHow has 'just' 4,320,000 pieces of content indexed in Google. About.com has 6,150,000. ReadWriteWeb.com has 30,100.

Note that Answers.com isn't necessarily highly ranked in Google. Answers.com has a Page Rank of 7/10, whereas Wikipedia is a 9. ReadWriteWeb has a Page Rank of 8. A search on the phrase "what is an rfid chip?" in Google revealed that Wikipedia holds the top slot and Answers.com doesn't even make the first page. So we can fairly say that Google isn't rewarding Answers.com for the quality of its content - or more correctly, it isn't necessarily being linked to by high-quality sources like Wikipedia is.

Conclusion: Quantity, Quantity, Quantity

We noted yesterday that Demand Media largely competes on quantity instead of quality. Answers.com takes quantity to another level altogether - and it can do this because it produces little if any original content.

Just look at Answers.com's growth over the past couple of years. The results speak for themselves.

In short, Demand Media knows how to get page views.

Demand Media operates based on a simple formula for success on the Web: create a ton of niche, mostly uninspired content targeted to search engines, then make it viral through social software. Demand Media has been heavily funded to carry out that mission, to the tune of $355 million. So yes, brute force - quantity of content + money/power - works more often than we'd like to think on the Web.

Demand Media was founded in 2006 by Shawn Colo and the former chairman of MySpace.com, Richard Rosenblatt. ReadWriteWeb first profiled Demand Media in November 2006, at which point we somewhat cynically concluded: "[the] next generation of new media it may be, but it all comes down to quantity in the end." Which is pretty much how it's panned out.

As of November 2008, Demand Media claimed to power 3 billion monthly social media interactions and was the #1 YouTube contributor. According to comScore, in July 2009 Demand Media had 31 million unique visitors.

Where Does the Content Come From?

Demand Media sources a lot of its content through freelancers, via its Demand Studios. The company has gotten content from over 10,000 people and uses a proprietary editorial system (apparently including "predictive algorithms") to publish it. As of May 2009, Demand Media claimed to have created more than 500,000 unique pieces of content - at a staggering rate of about 2,000 pieces of content per day! [Update: Demand Media contacted us to say that the total figure is now "nearly 1M pieces of content."] From YouTube alone, Demand Media garners 2 million impressions per day.

BusinessWeek explains the economics for contributors, but basically there is a set fee and percentage of ad revenues.

Conclusion: Demand Media Will Continue to Move up comScore's Charts

It's easy to be cynical about Demand Media - it creates truckloads of content very cheaply, uses social websites like YouTube to make it viral, and gets tons of page views as a result. But... it works. Demand Media earns more than $200 million in annual revenues, according to BusinessWeek.

Whether we like it or not, success on the Web mostly comes from quantity and not quality.

One does have to admire the system that Demand Media has built up to create content at little expense, make it viral and monetize it. The company's rise up the comScore Top 50 shows that this strategy is paying off big time.

We wouldn't be surprised to see Demand Media near the top 10 in comScore within a couple of years. As long as search engines like Google continue to rank niche, topical content highly - and we see absolutely no reason why they wouldn't - then Demand Media will continue to pump out thousands of articles a day to feed that page view generating machine.

Who Pays, Who Doesn't

The European Commission's Digital Competitiveness Report (PDF) is a comprehensive annual resource which looks at everything from broadband penetration to use of social networks and more. One of the chapters in the latest report, published earlier this month, deals specifically with online entertainment.

In this chapter, the EU study reports on the state of the online entertainment industry, revealing factoids like "less than 5% of Europeans have paid for online content in the last three months."

The most interesting results from the report, though, are not the details about who pays, but about who doesn't. Among the non-payers, factors like lower prices would convince about 30% to pay while things like better quality, wider choice, better availability, and others would convince between 15-20%. Yet one figure stands out: only around 20% of online users would pay for online content if all the other free options suddenly disappeared.

Peer-to-Peer File Sharing Not to Blame, Says EU

The impact of this finding didn't escape the notice of the EU researchers, who go on to point out that this seems to mean, contrary to what industry execs say, illegal copying is not to blame:

"...the low percentage of individuals that consider the possible lack of freely available online content as a reason for paying, calls into question the argument put forward by representatives of the content industry that European consumers will in the long term suffer from a lack of commercial availability of high quality content if the current model of audiovisual content distribution, based on illegal copying, is not curved."

Instead, what seems to be happening is that people pay for their internet connection and then gorge themselves on the abundant free content that's available online. Because there's so much out there which costs nothing at all - from web news to streaming video to software applications - internet users tend to balk at the idea of actually having to pull out their wallets to make a purchase. It's the internet itself that has led us down this path to a place where old monetization models simply no longer apply.

What's the Answer?

The report goes on to look at the business models of all sorts of content sites in detail including online news/newspapers, video, movies, music, and online games. While the ways consumers access these different types of content may vary (RSS for reading news, streaming videos, downloading music), the findings are relatively consistent across the board. With only a few exceptions (Apple's iTunes Store, music-based games like Guitar Hero, etc.), many of the current business models are not sustainable.

So what's the answer? There isn't really a good one just yet. Many businesses try "freemium" models which convert power users to paying users. Other sites try sustaining themselves on online ads (which is difficult to do in a down economy). But the best ideas for new business models may very well be the ones that haven't even been thought up yet. The only question is whether or not they'll be discovered in time before more content-producing industries fail.

Image credits - used freely thanks to the Internet and Creative Commons: downloading, flickr user Arenamontanus; I love P2P, flickr user Brocco Lee; p2p logo, flickr user jatop

That's one way to explain the degrees of separation between two people. Another way would be to click through the photos, videos, links, and descriptions on ThisIsLike.com or watch our screencast of that process.

The site is intended to be "a great recommendation system based on free associations rather than encyclopedic knowledge," according to site representative Dmitry Paranyushkin, who emailed us earlier today.

Already, the site has a slew of music, art, and philosophy entries and links. Paranyushin also sees ThisIsLike as a great tool for travelers in need of dining and entertainment advice. "When you come to a new city," he wrote, "you want to find a restaurant or a club that you like... Through ThisIsLike.Com, you can find some restaurant you already know and like and see what places are like that restaurant in the city you're visiting. If it's not yet in the system, you can add it, and other users might associate it with something they know."

Paranyushin further envisions the site becoming a great resource for those in the education and entertainment fields.

ThisIsLike allows users to add items and import information from Wikipedia, Last.fm, Flickr, and YouTube, thus drawing on the huge body of knowledge readily available online and decreasing the data entry needed from users to build the site into a viable resource. Users can explore items through tag clouds, cities, topic guides, and specific events. They can also search between verticals to find, for example, venues related to their favorite musicians.

The site is handsomely designed, user-friendly, and based on an interesting, Linked Data-esque concept. On the other hand, it's still very young, full of bugs, and in need of a diverse body of beta-testing users to flesh out the corpus. With enough time and a dedicated volunteer community, ThisIsLike could be an excellent, informative, and interesting resource.

Image by Peachtree Media Advisors

Twitter decided yesterday to delay a scheduled downtime for maintenance until the middle of the night, Iran time. CNN reports that the decision was made at the suggestion of the State Department, but a large number of users suggested it as well. Incidentally, open source Twitter alternative Identi.ca, which has the potential to be much more useful due to its decentralized nature, followed Twitter's lead and also made major changes at a time convenient for Iranians.

Some critics have argued that news of US government collaboration with Twitter will offer the Iranian government more leverage in calling them insurgent agents of the US. The CNN report was confirmed this afternoon by Reuters. BoingBoing has a good write up on how to help, not hurt, the efforts in Iran.

We've been following news from Iraq via this excellent aggregator built by Twitter search engine Twazzup, by watching the StopAhmadi account in particular and by reading Robert Fisk's excellent coverage for context.

Twitter cynics take note - this service is clearly not just for posting about what people ate for lunch anymore. We wish the Twitter team luck in fighting to keep the lines of communication open.

From parody sites being taken too seriously to fake news items somehow ending up on major news websites, the two tackle a wide spectrum of new media and industrial media issues. They also get to chat about the legitimacy and credentials of new media journalists and how many social media users have ended up being the first to report or broadcast important news in recent months.

Special thanks to Christopher Munton for camera/audio/editing work.