Condé Nast Buys Ars Technica - and why you might care
Posted by Chris Tippie
Today the acquisition of Ars Technica by Condé Nast (publisher of Wired magazine - among others) hit the blogsphere. The acquisition was rumored to be in the $25 million range. Ars Technica is officially a technology blog but in reality a bit more. I would put it more into the tech blog/community world as it does contain quite a bit more than the usual tech blog. However, couple of points: 1) there is no corresponding print product, 2) there is no anccllary ecommerce play (e.g. cnet) and 3) there is no corresponding broadcast product. Ars Technica is just that - a destination technology site on the internet. Some key stats:
- Purchase Price $25,000,000
- Monthly Unique Visitors: 1,500,000
- Monthly Pageviews: 4,000,000
Okay, let’s have some fun. Let’s assume that this acquisition helps set the market price for the internet blog pure play. What it this acquisition telling us?
- Value of the Monthly Unique User: $16.65/unique
- Value of the Monthly Pageview: $6.25/pageview
Pretty interesting metrics there for any publisher working to build an online audience around a blog. Now, let’s take a look at it from an eCPM basis. Let’s assume that Ars Technica has zero negative or positive growth in traffic for the next 3 years. I know, bad assumption but based on the rise and fall of tech blogs - it might not be too far off. This acquisition tips the scales at an effective CPM of $173.61 per 1000 page views. That is to say, all things frozen traffic wise, you will need to average an eCPM of $173.61 over the next 36 months to break even - just from a revenue standpoint.
NOTE: TechCrunch is reporting that the uniques are more on the order of 4.5 million rather than the 1.5 million that Comscore says. But its not as fun to use that number.
N.B. - I still don’t own an iPhone.
Other posts by Chris Tippie
Tags: ars technica, blogs, conde nast, wired
May 20th, 2008 at 11:37 am
Incorrect on several points.
Ars is getting ~40M pageviews per month with 5M readers.
It’s about $38 to buy 1000 pageviews on the site going by the old Federated Media numbers.
You do the math.
http://arstechnica.com/news.ars/post/20080519-ars-technica-acquired-by-conde-nast-the-low-down.html
May 20th, 2008 at 4:24 pm
[...] Maroon Ventures: Some key stats: [...]
May 21st, 2008 at 8:07 pm
Rian,
Thanks for your note and blog entry. You assert privately collected data as fact - something with which I fundamentally have an issue. That being said, I did make reference to the 4.5 million “claimed” unique number at the end of my original post. Though, again, that’s a privately collected number (along with the 40 million pageviews you cite). While everyone concedes that Alexa and Comscore undercount, that quite a miss - 1.5 million vs. 4.5 million uniques. That’s nothing compared to the more easily audited 4 million pageviews vs. 40 million that you also cite. Ten fold. Ouch. That sort of delta stretches logic and credibility. Whether that is in Comscore or in the private Ars Technicia data is for you to decide…. As for the 5 million “readers” comment (again, private data) - I won’t go there. I’m not going to speculate what Ars considers a “reader” vs. a monthly unique.
All that being said - all of this conjecture around Comscore vs. private data is really a moot point. Conde Nast evidently saw value there. Let’s see if they capitalize on it and where future acquisitions fall in valuation.
May 21st, 2008 at 8:25 pm
Chris,
Actually I was wrong. I read 30M as 40M. It’s actually 30M, and it was posted publicly on Monday. (After this post was written, so no fault of yours.) TechCrunch should have gone to the advertising source (Federated Media) and seen that their numbers were off. FM has Ars listed at 19M pageviews per month, and their traffic has been public info ever since Ars moved to FM for its advertising platform a while back.
http://www.federatedmedia.net/authors/arstechnica
That link will disappear, so I made a screenshot linked in my blog post. My 30M number comes from the official post about the acquisition written by Ken and posted this Monday.
So yes, the Comscore numbers are way off, and more accurate numbers are, and have been, freely available, if you know where to look. FM’s numbers for Ars will always be lower than reality simply because they have to be. If someone wants to buy 30M pageviews, you darn well better be able to deliver that many pageviews, otherwise your advertising credibility takes a serious hit.
Take care,
May 21st, 2008 at 10:30 pm
Rian,
NP. Actually, I think you raise the most salient point - the ultimate arbiter of Truth is “He who sells/serves the inventory”. Granted, as you point out, their numbers will be under reality because of the class 1 nature of the inventory. However, they are in the best position. So here’s a thought - if AMP gains substantial market share well beyond the current slate of partners (and maintains the exclusivity arrangements around ad serving with their partners - _key_), Yahoo will be in a prime position to become the arbiter of Truth for a significant segment of the market.