Giga OMG!

AUSTIN, Texas – This has been a bad week.

Not because of SXSW, which staged many fascinating panels and restored the proper brisket-beer-taco metabolic balance to thousands. 

And not because I endured the indignity of my first ever senior’s discount, at a Denny’s on I-35. The young server was very kind and took care to speak loudly and distinctly. Plus, while I don’t necessarily blend in with the acres of bearded 28-year-olds dressed in gingham shirts and jeans with turned-up hems, the bouncers here card everybody, which is a mitzvah, bless their hearts.

It wasn’t even a bad week because my panel -- premised on the dire state of media, legacy and otherwise -- went poorly.

On the contrary, it did not go poorly, because media -- especially news media -- are indeed in dire straits. All the king’s horses and all the king’s revenue streams -- advertising, events, customer research, subscriptions, freemium models, affiliate marketing -- are in the vast percentage of cases insufficient to keep the these organizations viable. They are kept alive, as I have so often observed, by venture capitalists and other investors whose stakes are burned at the stake; by retained earnings of legacy media companies; by patient billionaires; by amateur volunteers and by exploited refugees from the Good Old Days.



And that’s why it was a bad week. Because one of the best news organizations of the digital age, long a fixture at SXSW, was not present to record my cranky musings or anything else that took place here. Because Gigaom, the tech news site -- in grim fulfillment of my apocalyptic prophesies -- last week closed its doors. Here was the note on its site that broke its last bit of news to the world:

Gigaom recently became unable to pay its creditors in full at this time. As a result, the company is working with its creditors that have rights to all of the company’s assets as their collateral. All operations have ceased. We do not know at this time what the lenders intend to do with the assets or if there will be any future operations using those assets. The company does not currently intend to file bankruptcy. We would like to take a moment and thank our readers and our community for supporting us all along.

Ugh. To outsiders, the brainchild of tech blogger Om Malik seemed like an exemplar of Internet publishing. Through vigorous, accurate, straightforward reporting, it grew in audience and reputation, even as the business grew in scale. Backed by True Ventures, Alloy Ventures, Shea Ventures, Reed Elsevier and others, it grew organically and by acquisition. And the investments, eventually totaling $25 million, underwrote quality -- i.e, expensive -- journalism. The ad revenues, the conference business, the bespoke research arm, they seemed to make it all a going concern.

Versus a growing concern. Who knew what was behind the curtain? And, really, who wanted to know? Not me.

Although since the publication a decade ago of my essay “The Chaos Scenario,” I have been a professional pessimist on the subject of restoring media profitability, I am equally an advocate for solutions. I teach a University of Pennsylvania seminar dedicated to exploring the landscape of revenue possibilities, I’m organizing a summit of media bosses to swap ideas, and of course, I headed southwest to probe the experiences of The New York Times and Guardian US.

In other words, there is what I fear, and there is what I wish for. Gigaom represented hope -- a counter narrative to chaos. Then came the sad death notice. The only other new content was to be found in the reader comments -- which, with various degrees of irony, speak tragic volumes.

Tom Foremski Monday, March 9, 2015  The new media is facing the same disruptive forces as the old media…I’m sorry to hear this about GigaOm but clearly, there is as yet, no business model for media, especially media that cares about details and accuracy.

Jhesr Monday, March 9, 2015  This is just more confirmation that media companies still haven’t figured out how to prosper online. I think even the aggregators like Huffington Post, and Business Insider will eventually fold. As far as I can tell the movement from web browsers to mobile apps will be even harder on the digital magazines and papers. Oh well. I enjoyed reading Gigaom while it lasted.

 Spadoll Tuesday, March 10, 2015  hope you can get an investor to save the company.

  Adrian Melrose Tuesday, March 10, 2015 This is indeed sad news. Given you have many loyal readers (see comments to this post alone) – is it worth considering crowd funding your way out of this? 




7 comments about "Giga OMG!".
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  1. Douglas Ferguson from College of Charleston, March 16, 2015 at 11:07 a.m.

    Absolutely true. GigaOm was a welcome oasis in a desert of perfunctory media reporting. I will miss it.

  2. Christopher Stephenson from OnWords, March 16, 2015 at 11:25 a.m.

    Loved GigaOm...truly LOVED it. Quality, integrity, strong writing, smart writers... "UGH" is right! I'm in the midst of a start-up venture aimed at preventing these kinds of losses. I met prominent news publisher recently. After a hand shake and formal introduction, his first words to me were, "Google is taking all my money." While this is an oversimplified statement, I don't think he was far off. Can any digital entity survive in a market where a couple of technology giants make the rules and vacuum up 80% of the money?

  3. Jaffer Ali from PulseTV, March 16, 2015 at 5:53 p.m.

    Bob, I would love to be part of the collection of folks throwing ideas how to make publishing a viable business. Let me know if you want me to show up.

  4. Kevin Horne from Verizon, March 17, 2015 at 12:53 p.m.

    It may take a few years, but I wouldn't be surprised if the pendulum swings back the other way for media. This, of course, assumes that MIllenials and whatever we are calling the generation after them start to engage with the real world like the rest of us...and yes, while i'm at it, get the F off my lawn...

  5. Martin Focazio from EPAM Systems, March 17, 2015 at 2:05 p.m.

    GigaOm enjoyed the rare place of "default home page" on my preferred web browser, it was that good; but I think that "ad-supported" effectively makes your business an interchangeable revenue-generating machine for Google and Facebook, with some scraps left over for your company. What's interesting to me is what's going on away from the ad-supported publishing model - places where "publishers" are transitioning quite well - and without ad dollars - into semantic content discovery systems. But what about good old fashioned journalism? This is what I liked about Gigaom and still like about Ars Technica and The Information (and I freely admit, Business Insider, which keeps me amused most of the time and informed some of the time).

    The model used by (highly reccomended BTW) is, perhaps, the future. High-walled gardens with a small, but intense team.

  6. Barbara Lippert from, March 17, 2015 at 10:27 p.m.

    Is it possible that there were some financial misdealings/shenanigans? Very odd for it to close so suddenly.

  7. Jaffer Ali from PulseTV, March 18, 2015 at 8:26 a.m.

    The basic problem is simple. Media companies continue to view their reach in old terms. We have reached the point of nearly zero marginal media costs...and as marketers begin to understand the ecosystem, they value all media less and less, thus are not willing to pay premiums to reach what is becoming a fungible commodity.

    If you think of an eyeball as being fungible, something media owners have not yet grasped but marketers are becoming comfortable with, then different solutions for media owners start to surface.

    The person watching porn one moment than reading GigaOm the next are the same people...and worth the same . I see very little Halo Effect with online publishers rubbing off on marketers...which is why brand loyalty is also at an all time low.

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