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    How Much Can Chinese Bloggers Make From Blogging?

    manxcat.jpeg

    For most people, blogs are no longer exciting as they were in 2002, when they first burst on the scene. Part of the reason for this is because although the technology for blogging is mature, an economic model for bloggers has not really taken hold. This is especially the case in China, where there are a huge number of bloggers and the Internet has become hugely popular, but the economic rationale has not yet appeared. Several years ago, there was a lot of talk and conjecture about a long tail, and idea which Chris Anderson made popular with his book, The Long Tail.

    Unfortunately in China, the long tail looks like a Manx cat. (The Manx is a variety of cat which is born tailless.)

    Recently there has been much discussion in the US about the value of ad networks. The economic rationale for ad networks is simple: they buy unsold inventory and place ads in them so that no ads go unsold. Better to place ads anywhere than to have them wasted, right?

    Not so fast, says Jason Calacanis. Quoting from ESPN’s recent tough statement banishing ad networks, he says that “the use of ad nets diminishes the value of their (clients’) brand and content by spreading it so widely, ultimately threatening existing relationships with advertisers”.

    In his article, Calacanis argues that for that medium-sized publishers, they should take on the costs and responsibility of their own ad sales networks to sell their own inventory, instead of outsourcing to an outside ad network. He argues that a real publisher is in control of three things:

    • Your writers
    • Your readers
    • Your advertisers

    Moreover, he puts numbers behind his definition of a mid-sized publisher. If you have more than $250,000 in ad sales, you should hire your own dedicated sales person.

    His advice is that if you are a mid-sized publisher:

    1. Hire three ad sales people
    2. Spend 50% of your time going to ad meetings and conferences
    3. Kick out your ad networks and use something simple like Google Adsense to take up your backfill

    Another article about how Gawker Media pays their writers left me even more interested in how these numbers would translate for China. Gawker writers are not paid a salary, but simply get an “advance” against pageviews. Basically they have to hit their pageview numbers if they are going to do well. Moreover, these numbers are public.

    This raises a really interesting question: How would these US numbers for pageviews and traffic volume translate to make sense in China? And could it be that blog ad networks in China have held down bloggers’ salaries by providing low quality untargeted traffic, and the only way to turn the situation around is to have publishers build their own ad sales teams in-house instead of relying on outsiders to sell their ad inventory so that they can pay their writers a working wage?

    I suspect that the answer is “yes”, because only a publisher has the best sense and feel for their own content and audience. Ironically, it could well be that ad sales for medium-sized networks are something which cannot be sold best over the Internet.

    Now, that would be a change, wouldn’t it?




    5 Responses to “How Much Can Chinese Bloggers Make From Blogging?”

    1. [...] WdPoint Blog wrote an interesting post today onHere’s a quick excerpt For most people, blogs are no longer exciting as they were in 2002, when they first burst on the scene. Part of the reason for this is because although the technology for blogging is mature, an economic model for bloggers has not really taken hold. This is especially the case in China, where there are a huge number of bloggers and the Internet has become hugely popular, but the economic rationale has not yet appeared. Several years ago, there was a lot of talk and conjecture about a long tail [...]

    2. John G says:

      I think a Federated Media for China is a better answer.. Combine the human approach with a tech platform and let bloggers do what they do best.. produce relevant and interesting content. Since monetization rates are still very low in China (CPM/C etc), getting the larger brands involved in the conversation is more practical than bulk inventory adnets.. Perhaps china already has a federated media clone? If they do and when you said adnets for blogs you meant that, well then my response is China web still lacks the monetization infrastructure necessary for it to flourish beyond the 90/10 rule..

    3. Ryan says:

      Great article Paul, and an interesting question over all. But lets be serious for a moment, did you cut that poor cat’s tail off? ;-)

      I think generally online ad networks (Adsense, text links, Yahoo, Baidu, etc.) are a fantastic way for bloggers to make cash – but I think the networks need to scale back their cut. With the standard being 50% divide, it seems rather steep.

      Obviously the ad networks deserve a nice cut for serving up the ads, and providing a platform for buyers to easily do so, however, those ads do absolutely nothing if the sites they’re placed on doesn’t push itself as a premium site that can generate boatloads of traffic – which, in my opinion takes a helluva lot more work than an automated platform and some javascript bandwidth.

      If the online ad networks took less of a cut, leaving more for revenue for the folks that actual do the leg work, there would be more viable content produced, and the networks wouldn’t lose the top earners as soon as they get big enough to demand their own rates.

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