NOW IF ONLY SOMEONE COULD FIGURE OUT HOW TO MAKE MONEY OFF A BLOG...:

Internet News Sites Are Back in Vogue (ERIC DASH, 1/24/05, NY Times)

When L. Gordon Crovitz, the president of Dow Jones & Company's electronic publishing division, sat down last spring to assemble a three-year strategic plan, one of the things he foresaw was a potentially costly gap about to open. If the demand for online advertising continued to grow, Dow Jones's Web sites, including The Wall Street Journal Online, would not provide enough page views for all the online ads the company could sell.

"That is a wonderful problem to have," Mr. Crovitz said, "but you don't want to have that problem if you can avoid it."

Last summer, Mr. Crovitz set out to solve part of his problem by acquiring CBS MarketWatch, the financial news Web site found at cbsmarketwatch.com. The only problem: three other media giants apparently reached the same conclusion. The New York Times Company, the Gannett Company and Viacom Inc. all joined in to bid for the site. "I never thought the list of potential bidders was as long as it turned out to be," Mr. Crovitz said.

Dow Jones won the bidding with a deal, expected to be completed today, for $519 million, about six times MarketWatch's 2004 revenue. The four-way frenzy among the companies to own MarketWatch outright may be the strongest sign that news and information sites, long thought to be dot-gone relics of 1999, are making a big comeback in 2005.

Many of the same companies that were badly burned by Internet investments before are aggressively bidding for these sites not just because of the growing online ad business but because, like Dow Jones, they are worried that their current Web sites will not be able to keep up with demand.

"The existing old-line media companies, which have a big stake in where people advertise, have to recognize this medium," said Larry S. Kramer, a founder and chief executive of MarketWatch.

Interesting that for all the talk of how it will change everything the model for revenues on the Internet is still just advertising.

Posted by Orrin Judd at January 24, 2005 7:46 PM