Read this blog entry and then this one. Or reverse the order if you aren’t feeling brave tonight.

A nice article about blogads in the Wall Street Journal this morning. My favorite quote comes from Markos Moulitsas Zuniga: “I even get some money over to the college fund for my baby.” Here are some excerpts:

Blogs Grow Up:
Ads on the Sites
Are Taking Off

…
The Chandler campaign is evidence of the latest step in the evolution of the Internet. Blogs, once derided as solipsistic exercises by self-important nobodies, are starting to go commercial as their readership grows.

The trend is in its early stages; big advertisers like Coke and Procter & Gamble aren’t yet hawking their wares on blogs. Indeed, much of the advertising is found on politically oriented blogs, which are experiencing a spike in readership from the presidential election. Many people wonder if the blog ad boomlet will outlast the election.

But other Internet institutions have had similarly modest origins; recall that eBay started out as a place to trade Beanie Babies and Pez dispensers. And it’s no surprise that as blogs grow in popularity, they are beginning to attract advertisers. Indeed, the entire Internet has been experiencing an uptick in ad revenue, with advertisers beginning to open their wallets again for the first time since the collapse of the dot-com bubble in 2000.

Typical of the new breed of “bloggerpreneurs” is Markos Moulitsas Zuniga, who runs Daily Kos, a liberal political blog. Mr. Moulitsas says he initially wanted to keep his blog ad-free, as a way of preserving his independence.

But in December, he had to buy new server computers to keep up with growing traffic, and he started taking ads to pay the bills. Business was so good that in three months he was able to double his ad rates. Now, he’s bringing in $4,000 a month.

“That is phenomenal to me. I even get some money over to the college fund for my baby,” says Mr. Moulitsas.

…

Still, blog ads are in their infancy and the operators of these sites face big hurdles in luring more of them, ad experts say. “Over 90% of the business of Internet ads [goes to] 20 large, established news media like nytimes.com and WSJ.com. Honestly, the blogs haven’t hit the radar yet,” says Stu Ginsberg, public-relations director at the Interactive Advertising Bureau, a trade group for Web sites that take ads.

Yet the blog ad trend is far enough along that at least one company has sprung up to serve the market: Pressflex LCC. The Chapel Hill, N.C., company’s Blogads service connects advertisers with a network of bloggers, charging 20% for its efforts. So far, it says it has placed ads on about 200 blogs.

“They said nobody would want to advertise on personal diaries. Even my wife thought I was crazy,” recalls Henry Copeland, who founded the company in 2002. Now, he has three programmers working for him in Hungary.

…

Still, only the top blogs can snare ads from mainstream companies. Most others have to content themselves with ads from candidates, with conservatives typically advertising on conservative blogs, and likewise for liberals.

Other blog ads are for somewhat quirky products, such as a CD with humorous Christmas songs sold by Paul Libman, a Chicago composer. It’s an effective medium, Mr. Libman maintains; thanks to $450 in blog ads he sold 1,000 CDs during the holidays, twice as many as earlier seasons.

“I don’t think that the bloggers realized how much these ads are worth,” he says. “Next year it will be much more expensive.”

Indeed, the topic of blog ads, and how much they are worth, has become a theme in the discussions that bloggers have about their work on their own blogs.

…

James Wolcott in April’s Vanity Fair:

“Don’t dismiss blogs as the online rantings of B-list writers. Interlinked and meritocratic, seething with fierce debate and rivalries, they’re the best thing to hit journalism since the rise of the political pamphlet.”

Thank you to Jeff Jarvis for excerpting so much of the article.

UK publishing consultant Ian Jindal writes:

Recent estimates put the number of weblogs at between 1.5 and 3 million, excluding simple diaries or home pages. It’s also clear that there’s a power-law relationship in operation where the top few hundred blogs are attracting very serious levels of traffic.

Where, then, does this leave online publishers, especially those who publish news and analysis titles? What impact does this outpouring of information and opinion have upon our businesses? Other than publishers who have created unassailable positions through the creation of unique, necessary and clearly valuable content (eg Reuters, Bloomberg or news agencies), the majority of publishers fall into the ‘nice to have’ or ‘interest-based’ sectors rather than the ‘need to have’. Revenue models depend upon subscription, syndication and advertising, but with increasing amount of relevant, current content available free of charge, subscriptions and syndication opportunities are under pressure. Equally, with advertising following traffic volume and ‘what’s cool’ at a given time then advertising is also moving to Blogs. Henry Copeland’s Blogads approach should cause concern for publishers to the youth or strategic business market (http://www.blogads.com – the introduction is pithy and convincing).

Publishers would assert that in a time of mass ‘push’ of info that their imprimatur communicates quality assurance; that they invest in research and origination and that their reputation adds weight to their comments. This is patently of limited commercial comfort. Some of the bloggers are experts in their fields and do not need to be interpreted or validated by a ‘title’. Equally, journalists’ own blogs are often researched to the same standards as the titles for which they write – and challenges to their views and corrections or updates are much more readily and clearly made. Finally, many of the blogging systems are as sophisticated as expensive CMS offerings of but a couple of years ago. The online publishing standard has never been higher, nor more broadly available.

The Atlanta Journal Constitution covers the use of blogads by two competing primary candidates in Georgia.

One of the candidates, Doug Haines has answered a number of questions in his blog‘s comments section. A DailyKos visitor to that blog said, “you’re really raising the bar for all the candidates seeking support from the blogosphere. Great work.”

I’ve previously argued with Ed Cone about whether it is too early for blogging to play a role in local races. But watching the Haines blog, I detect the kindling of a bonfire.

If you know of other articles about blog advertising, drop me a line at henry at blogads.com.

My buddy Steve in Amherst is busy milking gallons of sap a day from his maple. Unfortunately, he let one batch cook too long.

Reflecting on the recent loss of one of his star employees, Nick Denton writes:

For those of you who doesn’t follow every navel-gazing twist and turn of the blog world, Jason Calacanis of Weblogs Inc., a rival, poached one of Gawker Media’s writers, Pete Rojas of Gizmodo.

Sure, we recovered quickly. Joel Johnson, who was going to write another upcoming site, stepped in. And traffic has rebounded, though those readers may simply be enthralled by the spectacle of an online car crash happening in real time.

But the fact remains that I was caught unawares. I was in Brazil, my mind on other things. Before Pete gave his notice, he and Calacanis already had a slick copycat site — Engadget — ready to go. The shafting will be complete, today, with an artfully-placed item in New York Magazine, in which Calacanis boasts of his plans for 500 blogs. Round One to Calacanis. On to Round Two.

Is there any broader meaning to all this? Well, I have just one tentative conclusion. Blogs are likely to be better for readers than for capitalists. While I love the medium, I’ve always been skeptical about the value of blogs as businesses.

Nick artfully ignores the fact that “capitalist” and “corporate owner” are not synonomous.

Indeed, the solo writer is perhaps the ultimate capitalist, an infopreneur who is profoundly empowered by blogging and its tools.

Any publishing business with more than one employee has higher overheads and less focus than the great bloggers flooding the market with news, insights and passion. While Nick Denton and Jason Calacanis use blog technology and idioms, their business model is still old line publishing.

Boiled down, the corporate model of media (whether done by Calacanis, NYT or Advance) looks like this:

owner : 1
boss : 1
ad sales : 1
flunky : 1
writer : 1
marketing person : 1
IT : 1

The blogging model looks like this:

writer/owner/boss : 1
marketing : 100s of peer bloggers (blogosphere)
ad sales : 100s of peer bloggers (Blogads)+Google
IT : Typepad or pMachine

The second model has 10,000 times the fire power with 1/6 the mouths to feed. Would someone please explain how the corporate model can compete… what the heck am I missing?

Marx is grinning in his grave; thanks to Moore’s law and the Internet, writers now can own the means of production that, previously, only publishers could afford. The only monopoly left in media is the individual’s ownership of his or her own talent. With a strong voice and loyal audience, Rojas will be working for himself and not Calacanis soon enough.

Calacanis brags, in New York magazine, that he’s soon going to be hiring New York Times journalists and, gasp, giving them equity. Equity! Bless you master Calacanis for sharing a few precious drops of equity with a mere writer.

WTF? I guess I’m stupid. I don’t get why a writer should be excited about getting some equity and working for someone else, when he can own 100% of his own gig and call his own shots.

(I’m keeping abreast of all this by reading the incomparable Jeff Jarvis.)

Something funny often happens on Friday afternoons.

Business ticks up a notch.

And, even better, I start hearing from folks scratching their heads about blogads. This happens most days, but I can always count on a good dose of brainstorming starting at 3PM Friday.

This afternoon, I talked to three different people in quick succession — an entrepreneur, a environmentalist and a campaign manager. The conversations were remarkably similar. What makes a good blogad? What’s a good landing page look like? What kind of impact — sales, buzz or zeitgeist nudging — might result from a good fusillade of blog advertising?

It’s really fun. Talking to smart, ambitious people about how blogs can help them reach national audiences — passionate, influential and affordable national audiences — is a great way to spend a Friday afternoon.

But, what is it about Friday afternoon — starting at 3 and ending around 6PM — that makes it the witching hour for blog advertising? I really don’t know.

BTW, I started blogging late in the afternoon exactly two and half years ago.

And, before I forget it, here’s the new Harvard case study of the bloggers who upended Trent Lott in December 2002.

And you want to know something amazing? You can buy a week of advertising on the three blogs — Atrios, Instapundit and Talkingpoints — credited with rousting the Speaker of the United States House of Representatives… for $1000. Damn.

Lots of talk and observation about the latest Pew study, which shows that, among other things, 17% of Internet users have posted written material on Web sites. The most interesting number for me, though, is this one “11% of Internet users have read the blogs or diaries of other Internet users.”

Believing fervently that blogs offer a superior media (or should I say unmedia) experience for most readers, I’ve often wondered how many people haven’t yet heard of blogs… which is to say how many more people we can still expect to discover blogs and become addicted.

This Pew number is much higher than I expected, particularly because a number of people have probably visited blogs but don’t know that’s what they are visiting. So maybe the number is 20%? That’s quite a contrast to a couple of years ago when NOBODY I met — except bloggers — had heard of blogs. My wife and I used to share the same grim laugh after a night dining with friends — when would someone do more than mumble politely or giggle discreetly when I mentioned the word blog?

Today, I’m no longer longing to meet people who know what blog means. On the contrary, when I meet a blog reader… darn, another market already conquered, I think.

So, if 20% of the American internet users have used blogs, does this mean that blog traffic can only grow 5 times from here?

I’d suggest no — many of today’s readers haven’t yet found exactly the favorite blogs — indeed many of those blogs have yet to be birthed. So shall we say 10 or 20 times? Moreover, we know that the longer people are on the Internet, the greater their usage. Folks who have been online 6+ years use the internet 15.8 hours per week, 50% more than folks who have been online 4 years (10.9 hours), and three times longer than people who’ve been online less than one year (5.5 hours). (That piece of vital but widely ignored data is buried on page 22 of this UCLA report.)

So will the readership for weblogs some day reach 30X or 100X current levels? If you find this post via Google in five years, leave a comment and tell us how things turned out.

I came across this anecdote reading Martha Ackmann’s The Mercury Thirteen. In the late fiftees, NASA was struggling to master the art of building safe rockets. Rocket after rocket blew up.

In the spring of 1959, when the seven astronaut candidates were first brought to watch an Atlas rocket lift off, the rocket blew up on the launch pad. After a few minutes of silence as the men watched debris shower down over the ocean, Alan Shepard muttered to his compatriots: “well, I’m glad they got that out of the way.”

Two years later, when Shepard became the first American in space, NASA’s brass had three speaches prepared… one for success, one for ocean bailout and one for Shepard’s annihilation.