The democratization of information in the Internet age and clickbait as a business model

By Edward Harrison On Aug 8, 2018

It’s been a while since I wrote my last post in my series about the Internet and Journalism. Time constraints have limited me. So I am going to write shorter posts in order to up the pace a bit.

Oh, and in case you want to re-read the previous posts, here’s a list of them in order:

How do you make money on this thing?

I want to come back to a couple of things I wrote near the end of the fourth post.

As newspapers downsize under the assault of Internet-inspired revenue loss, alternative media will spring up to replace them. And from my perspective, much of this alternative media will have lower journalistic standards, contain more bias and partisanship, and be more prone to peddling ‘fake news’.

The question for these media outlets is where the revenue stream will come. That’s the same question newspapers are asking themselves. One thing is clear though: alternative media outlets that can make themselves appear high in search and share algorithms on the Internet will win in this world. And to the degree they can become embedded inside the partisan safe spaces now developing in reaction to the byzantine media landscape, they will be met with a more trusting and credulous audience.

I think there are four separate threads here:

Traditional media is in decline and will be ‘replaced’ by alternative media
Both will need a revenue model though
Alternative media will be more prone to peddling ‘fake news’
Search is critical in giving life to alternative media outlets

I am going to take the first thread for granted because we see the death of newspapers and magazines daily. And we also see a lot of alternatives pop up. And they run the gamut from Politico to Axios, the Huffington Post, the Young Turks, the Keiser Report, and InfoWars.

I added InfoWars in particular because it has just been suspended from multiple ‘search’ (and social media) outlets for peddling fake news. And this goes to the heart of the question. How are these guys going to make money?

Clickbait and sensationalism

In an open internet where everything is free, advertising is king. And so pageviews are really, really important because Internet advertising is paid on a cost per impression basis. The more ads you can stuff into a page and the more pages you can display to site visitors, the more money you can make.

But remember, the Internet is the ultimate deflationary force. Ad rates are incredibly low and no journalist that invests time and energy in creating a solid piece of fact-checked work can expect to earn even poverty wages based on Internet advertising alone. The income stream simply isn’t sufficient.

Here’s an article that says mobile advertising rates are in the order of $2.00 to $10.00 per 1,000 impressions. And that’s high. Other ad trackers tell you the CPM rates can be below $1.00. At a $1.00 CPM, you would need to display 100,000 ads to make $100. And assuming you had 5 ads per page, that equates to 20,000 page views. I can tell you from my experience, that’s a lot of page views. And it only gets you $100. At a $5 CPM, $500.

So clickbait is a necessity if everything is ‘free’ and that’s not because of greed; it’s because the advertising rates are so low that you have to have monster page views to generate revenue.

Now Google has no problem in this world because it owns search. And it generates monster page views as a result. Google processes over 40,000 search queries every second. But the average website on the Internet certainly won’t generate that number of page views in a week or a month.

So as a content creator in the free Internet world, either you do something else for a living or your mind quickly turns to clickbait and sensationalism to drive traffic. As an author, you move away from thinking about the highest quality content you can to thinking about how to write posts to drive the most clickthroughs. As a site designer, you start to think about how to get people to stay on your site or to visit again and again.

The UK’s Daily Mail has mastered this side of things. All of its headlines are sensational. It interweaves other articles with sensational and clickbait headlines throughout its site to drive even more traffic. And it has a very robust almost unfiltered comment section as well, which drives yet more traffic.

The Daily Mail has ramped up its US coverage to take advantage of the fact that it is an English-language publication and the US audience is much bigger than the UK audience. If you install the Daily Mail app, it will ask you for your location. And if you give them that location as the US, it will re-order your news so that it is all US-centric.

The Daily Mail is the quintessential free Internet traditional media news organization.

Zero Hedge is the Daily Mail of financial news

Let’s remember that the more traffic you drive, the higher you place in search results, driving still more traffic. So you can see the allure that clickbait has.

Take Zero Hedge, for example. They do tremendous traffic numbers, the best in all of financial media frankly. How do they do it, you ask?

First, like the Daily Mail, they churn out an enormous amount of content and title it in the most sensationalistic way to generate clicks. Second, they never link to outside sources in order to keep users on Zero Hedge and to stop that leakage from pushing them down in the search rankings. And third, they have a ton of ads on every page to generate revenue.

I went to their front page where they were running the Saudi-Canada story as the lead recent story. My adblocker caught two advertisements above the fold marked “advertisement” on the left and the right.

Then I input “saudis canadian assets” into a Google search and this is what I found:

Notice Zero Hedge’s high placement on the list. It may be Zero Hedge’s twitter feed instead of a direct article link. But Zero Hedge rarely links to anything but their own stuff. So it is effectively a link to the Zero Hedge Website. If you ran this kind of experiment repeatedly, Zero Hedge would do well time and again.

Zero Hedge is the quintessential free Internet alternative media finance site.

Final thoughts

Are the Daily Mail and Zero Hedge bad? You know me and my rule about suspension of disbelief. So you know what I would say. But let me say this: Zero Hedge has some very insightful pieces. And I actually read the Daily Mail every single day. Seriously.

The reality is this is where the ‘free Internet’ is right now. And I believe this is where it will stay. Do Zero Hedge and the Daily Mail peddle “fake news”? Well, they certainly have pointed, what I would call slanted, reporting both through commission and omission.

But they are speaking to an audience. They are trusted sources inside a safe space for hundreds of thousands of people. And that’s how the Internet works today. And that’s also how I think the free Internet will continue to operate.

Paywalls are the only alternative.