Just last week, David Talbot, the founder and chairman of Salon, was describing the world of online media in terms so bleak you would have thought the whole thing couldn't possibly get any worse.
"In the early days we thought that there'd be literally hundreds of sites like Salon," he said, reflecting on how the dot-com blight dried up his dreams of an online media that could rival -- or even bring down -- the traditional news establishment.
"We expected many publications that were capitalized sufficiently to support a professional newsroom, even a small one, something that prints compelling daily content. Now, I think we're the only independent one around -- and I guess Feed is still going along."
And then, over the weekend, things got worse. Feed Magazine, one of the Web's earliest general-interest daily publications, stopped "going along," as Automatic Media, its Manhattan-based corporate parent, announced that it was shutting down due to -- what else? -- financial difficulties.
Salon is now the last one standing: the only original online mag that's still alive and isn't owned by a multinational corporation. And Talbot thinks that despite the company's financial problems, Salon's uniqueness engenders a certain must-keep-it-alive ardor among its readers, who will make sure the site doesn't become the next dot-com casualty.
A few months ago, when Talbot announced that Salon would introduce a $30-a-year subscription service featuring ad-free content, Internet and media analysts scratched their heads in wonderment.
Would it work? Publications from Wired News to CNET to The New York Times predicted that Salon's move would prompt others to charge for content -- and though media-watchers said that paying was inevitable, nobody could say whether they thought it would work.
Now, several weeks into the service, Salon's site features some tactful but still somewhat desperate-sounding pleas for money, lots of free content, plus a regular column -- "Bushed!", which chronicles the president's doings and undoings -- that's only offered to subscribers.
Talbot and other Salon execs would not divulge how many people have signed up for the service so far, but they did say that they are "ahead of projections" to have 50,000 subscribers in the first year.
Talbot deemed the results "encouraging," and Patrick Hurley, Salon's vice president for business operations, said that the cost of implementing the subscription service -- a billing system and such -- "was recouped by the fourth hour of the service."
Hurley said that so far, visitors to the site have reacted pretty well to the changes. There have been few accusations, he said, that Salon is profiteering or somehow being too capitalistic for implementing this service.
"Most of the responses we have gotten so far have been fairly pragmatic and fairly positive," Hurley said. "And that's partly because we have tried from an editorial standpoint to get the message across about why we need this."
People have realized the gravity of the situation, in other words, so they've quit whining.
And that's the sentiment Talbot is counting on as, during the course of the next year, he draws up plans to push more of the site's free content "behind the gate" of the subscription service, thereby making the $30 service more valuable.
"We're going to be even more aggressive about playing Salon Premium," he said. "It's not going to be a static group of editorial items like 'Bushed!' that's there now."
As more of Salon's content is pushed only to subscribers, Talbot thinks people will say, "Hey -- some of the best stuff is behind the gate now. I should sign up."
As early as next year, "the model that we have now will be flipped around," Talbot said. "Most of the stuff will be by subscription. There is even a school of thought within Salon management that we should go there sooner. It would be a shock to the system and a huge risk, but if we were to shut the gates entirely, even this year we could probably get at the very least ... 300,000 people to sign up. At $30 a piece, that's $9 million, which is really close to break-even."
Talbot is a fun and easy guy to talk to, and when he discusses such subscription possibilities, you desperately want to believe him. It would be nice, after all, to see a dot-com make things work.
But Talbot and everyone else in the online media game know that proposing to charge for all online content is a very risky initiative, and that simply being "ahead" of projections doesn't mean much for the ultimate bottom line.
As Martin Nisenholtz, the CEO of New York Times Digital, put it, "I don't know what their goal is. I don't know whether to say that's a success because I don't know the yardstick."
The problems here are obvious: Just because Salon is on track to get 50,000 people by next year doesn't mean it will, and it certainly doesn't mean they can get 300,000 people. In the world of online media, that's an almost unheard-of figure: The Wall Street Journal, which caters to a very select group, has garnered more than 540,000 people for WSJ.com since it started charging in 1996, but subscription drives at Slate and Inside -- sites more comparable to Salon -- were unmitigated disasters.
Journalist Ken Auletta reports in The New Yorker this month that Inside -- which offered a fly-on-the-wall look at the entertainment business if you could pay $200 a year -- convinced, at the maximum, about 5,000 people to subscribe.
Nisenholtz declined to comment on Salon's possible fate, but what he said about his plans for New York Times Digital was informative enough: "I've been modeling this stuff out since we started, in 1995. I have to say, to date, the gated model (total subscription) simply isn't as compelling as the one that involves charging for specific premium products."
For example, the Times online charges for a premium crossword puzzle service and for its archives. Nisenholtz said that by the fall it will be adding more premium content; as an example, he mentioned streaming video of events held by The New York Times.
When the subscription was unveiled, Talbot likened it to the model used in public radio, where people pay to support a service without which they know the world would be somehow less varied, less informed, less fun.
Talbot said his analogy has never been more true than it is now, with other media becoming ever more consolidated and corporate; he insists that while the big media companies might be able to stay free on the Web, "scrappier sites like Salon have to start getting some of that money from their readers."
"The Salons of the world are saying the things that nobody else is saying. So if the Salons of the world disappear, woe to American democracy," he said.
People will pay to keep Salon alive, in other words, because they know how valuable it is. That's a pretty thought, but nobody knows if it will hold true, and Talbot says that the feeling among the magazine's staff is "nightmarish."
"This is really a test of our resilience," he added.
Last week, England's MediaGuardian featured a piece saying that Salon would bite the dust any day now, because it's on track to lose around $20 million for the year, and its stock price (SALN) is so low it might be delisted from the Nasdaq.
Talbot acknowledged those fears, and he said that "we're hopefully on the verge of securing a new investment," though "we haven't signed anything yet."
"The things that are happening to us now are out of Salon's control," he added. "And if we make it out to the other side, things will be great. We'll have less competition, we'll have subscribers. The trick is getting through this year."
