Blogonomics: Should Seeking Alpha Pay its Contributors?

Time for a breather from the credit crunch, I think. Instead, let’s head over to Bill Rempel’s No DooDahs blog, where he rails against Seeking Alpha’s business model, and says that Seeking Alpha gets 66 times as much value from its contributors as the contributors get from Seeking Alpha. Unfair!

Rempel is clearly someone who is looking to monetize his readers through serving up advertisements; in that sense he competes with Seeking Alpha for advertisers, and it makes sense that he might stop posting there. But there are many other reasons to become a Seeking Alpha contributor which present much less of a conflict.

Making money, at least in a direct monetizing-visitors sense, is not the reason that very many people start blogging. Indeed, in the econoblogosphere, there are quite a lot of people like Mark Thoma or Greg Mankiw who run no ads at all. People just want a soapbox in their little corner of the internet, and sites like Seeking Alpha and Huffington Post give them a bigger soapbox.

I have more sympathy with Henry Farrell than I do with Bill Rempel. Farrell asks a genuinely provocative question: Why it is that academics submit to commercial journals that make (in many cases very substantial) profits from publishing their pieces? I can understand why academics like Farrell might object to that, because it involves putting stuff behind a huge subscription firewall. Seeking Alpha and Huffington Post, by contrast, have no firewalls at all, and actively encourage their contributors to put their stuff up on their own blogs.

That said, however, Seeking Alpha doesn’t seem to put much effort into driving any traffic away from its own site and towards its contributors’ sites. Most contributors would really like that, and I think Seeking Alpha’s readers would too, especially since SA doesn’t offer writer-specific RSS feeds. I think prominent links to the same blog entry on its original site, as well as to contributors’ own RSS feeds, would garner quite a lot of good will and would probably only increase SA’s own traffic. As ever on the internet, the more you send people away, the more they come back.

But never mind what I think. I asked Seeking Alpha editor in chief Mick Weinstein what he thought of Rempel’s column, and got this wonderful reply; I’ll let Mick have the last word. For now.

For our contributors, joining SA means much more exposure, reaching a far broader audience, expanding the conversation around their ideas and creating new business opportunities. Sure, we’re building a business of our own, but our success as a company not only can be shared with our contributors – it must. Our contributors are the heart of the site. Our relationship with contributors has always been a win-win, and we’re continually thinking of ways to bring more to our contributors.

For the time being, our model doesn’t involve a revenue share, but (unlike HuffPo, it seems) we haven’t ruled that out for the future.

Here are some of the things we currently do to bring exposure and opportunities to our contributors:

– We recently expanded the area to the left of all article pages that promotes the author’s site, business, book or services – see example for a fund manager here or a book author/newsletter publisher/podcaster here.

– We invest in editorial and tech, so authors’ work appears far more polished and on a sharp, professional and stable website.

– We invest in business development so authors’ headlines appear on Yahoo Finance, E*Trade, Reuters and elsewhere.

– We invest heavily in content, such as 2,500 free, transcribed quarterly conference calls that enrich the overall site and the level of discussion around contributors’ articles.

Is it working for SA contributors? Well, we’ve had over 1,200 authors submit articles since we started (including one-off submissions through our web form). We now have over 300 regular, ongoing contributors, and in the entire 2.5-year lifetime of our site, only a handful of those regular contributors have chosen to stop publishing on SA. These have mostly been writers who found they were more interested in trying to monetize their own sites than they were in the exposure and community on SA. We completely understand this and wish them the best of luck.

But if you’re an aspiring market journalist considering SA, you have Jim Cramer’s ear for one – Cramer calls Seeking Alpha a "farm team for future TheStreet.com columnists".

If you are a fund manager, you reach a savvy readership that’s ideal for attracting new clients.

If you are a sector-expert blogger, you can reach a completely new readership pool that finds your insight incredibly valuable. (Here I’m thinking someone like Michael Arrington of TechCrunch, a SA regular contributor.)

If you are a book author, you get ongoing publicity for your book. And if you’re none of the above, but rather an insightful individual investor who does rigorous analysis and just wants to share that with the world, you get 2.6 million monthly unique visitors reading and responding to your work. That’s a nice incremental supplement to a Blogger blog, no?

Bottom line: We have become the leading site to read opinion and analysis on the market, written from an investor’s (rather than a traditional journalist’s) perspective. We offer our contributors an opportunity to contribute while gaining exposure for whatever service they may be wish to promote. But we fully recognize that SA doesn’t work for every writer, and wish Mr. Rempel the best of luck in whatever his goals may be at ‘AbsolutelyNoDooDahs.’