It's been a great month for Sharon Waxman and The Wrap, the entertainment-industry news site she launched in January -- in part because it's been a not-so-great month for some of her competition. First, the Hollywood Reporter was beset by rumors, thanks to a report on Nikki Finke's Deadline Hollywood blog, that it would soon abandon its daily print edition (the publication denied it), while Variety, after several years of trying to drum up page views and additional advertising revenue with free content on its website, announced that it was going back behind a paywall in 2010.
Meanwhile, The Wrap announced a content partnership with Microsoft's MSN -- with stories from The Wrap getting distribution throughout Microsoft's various entertainment destination properties -- which should significantly boost traffic to Waxman's site. The deal underscores just how quickly The Wrap has come to be considered a must-read within the industry it covers, while signaling that Waxman, who serves as the site's editor in chief, intends to continue to expand beyond trade reports with entertainment news that appeals to a wider, non-pro audience.
For this latest edition of Dumenco's Media People -- a continuing series of conversations with media grandees -- I had tea with Sharon Waxman in Manhattan during one of her recent business trips to the city. Based in Los Angeles, Waxman is a veteran journalist and entertainment-industry reporter. She's been a correspondent for the New York Times and the Washington Post, and has authored two books ("Rebels on the Backlot: Six Maverick Directors and How They Conquered the Hollywood Studio System" and "Loot: The Battle over the Stolen Treasures of the Ancient World").
Dumenco: What were your expectations going into The Wrap -- your plan, pre-launch -- and where are you now according to plan?
Waxman: Well, our hopes were that we would be adopted by, at the very least, within year one, the entertainment industry -- that we'd be read and matter to the people who make movies and TV. We really kind of did it in the first three to four months, you know. Our goal was get on the map and our next goal is to make the traditional trades irrelevant and become the No. 1 source of news, entertainment and community for the entertainment industry, for the entertainment professional. I was just at the Toronto Film Festival and it was so gratifying. Every time I go to a thing, like at Cannes, everybody is reading us. It's extremely rare that I come across somebody in the industry who hasn't heard of us and isn't reading us every day. That's the key to me.
Dumenco: How are you positioning yourself against the traditional trades: Variety and the Hollywood Reporter?
Waxman: There were a lot of unknowns along the way but one of the things that has happened since we started is that we aren't a traditional trade at all, we aren't even an untraditional trade --- we're something new and different. What we didn't count on was that those traditional trades were going to grow so weak and be in such dire financial straits as they have been.
Dumenco: You're something "new and different" -- a hybrid, I suppose, that's a little bit tradey, a little bit bloggy, a little...
Waxman: A little trashy, a little sassy, a little serious.
Dumenco: [laughter] Yeah.
Waxman: You know, I'm learning and evolving as a writer and as an reporter, and I've allowed myself to be a lot more personal with The Wrap than I've ever been -- and I think that's part of how journalism needs to be in the age of the internet. Traditional journalists have to be more daring with the voice that they write with. But it has to be accurate, it has to be fair, both sides have to be reported -- so those principles of reporting that I bring with me are true for everybody who writes at The Wrap. We're trying to get the people who have those principles to be looser, and to get the younger folks to, like, make sure that they button down on all the facts and figures.
Dumenco: Which is more difficult?
Waxman: It's actually harder to get the more traditional journalists to sort of break their chains. It's interesting. It is extremely liberating. It's very absorbing. I mean, I just think it's much more fun to be in a position where I can try to come up with a formula that works rather than just be part of a system that you are aware is crumbling around you -- and to be unable to do anything about it, which is where a lot of journalists have been. It's incredibly frustrating and it's also a really bad environment in which to do journalism.
Dumenco: I think what we're seeing now, we're at this tipping point where a lot of traditional journalists are realizing that in a sense, they were only effective, they were only 'important,' because they were part of a traditional institution. Like I was talking to a colleague about a particular newspaper reporter we both know and so much of the news that he 'breaks' is stuff that is handed to him simply because certain sources would just still rather it appear in traditional media, and because they know they can control the spin if they're careful about how they spoon-feed.
Waxman: It's not gonna fly anymore. They're not long for this world. There is not going to be room, if you're asking about where journalism is going, there's not going to be room for press-release journalism anymore -- there's no need for it. Any company can post their own press releases and at The Wrap we'll eventually have a system where things that I consider to be industry announcements will just be posted to the site -- the most interesting announcements -- but I'm not going to pay a staff of reporters to do that. That was in my business plan -- that's been my critique of the trades. I just think that journalism, in general, is going to be a smaller professional class. People who get paid to do what we do, the number of people who can sustain a professional life is just going to be smaller -- and the reality is that means we have to be better too. It's going to be the best of us who survive.
Dumenco: How big is your staff right now?
Waxman: Our staff is ten people right now. Our contributor base is a lot larger than that. I'd say we have about 20 regular contributing writers. Some of whom are under contract, some of whom are not.
Dumenco: The ten are salaried people?
Waxman: Yeah. Most of it's editorial.
Dumenco: Talk about the business model a bit -- in terms of anticipated advertising support, who's been supporting you so far, the event business, and so on.
Waxman: Advertising is very, very tough, as you know, but I presumed that advertising would be tough this year and I figured, OK, we'll just be very lean and mean and by the time we come out of this economic war zone we'll be very well positioned to scoop up ad revenue as it comes back. There is an endemic advertising base for us -- the studios, the networks, production companies, particularly around Oscars and Emmys. They spend money all the time and then of course anything related to all these new-media companies that want to be involved in Hollywood. And the big brands, of course, that want to be associated with the glamour of the movie industry.
Just to lay it out for you, there is display advertising on the site, our e-mail newsletters, sponsorship -- sponsorship has to do more with underwriting different pieces of content, and usually that goes with events that we've had. British Airways and Four Seasons were two large sponsors. Lifetime is sponsoring an event with us, Blackberry is working with us. Almost all the TV networks during the Emmy campaigns, and we're just closing advertising agreements with various studios for their Oscar campaigns. People are going to start jockeying for space.
We're also building up our event strategy. We're having our third event coming up and then we're having a screening series as well in which we'll screen a movie that's an Oscar contender -- we'll do a Q&A -- so it's very synergistic with our content, and then we always cover it, so then there's that ripple effect for our sponsors.
We're also looking at subscription strategy now. It may be that we end up going in that direction. We have to stand behind what I really believe to be true, which is that quality content is something that people should pay for. If they're willing to spend their time on it, they will spend their money on it. We just have to give it to them in a way that is convenient and get the right price point and make it really easy to pay so it's not a big pain in the butt. The barrier to paying is not the money, it's the pain in the neck of having to look at the credit card. I know probably a good number of our regular readers would pay for it -- they could put it on their expense accounts because it's part of their business. But we will not abandon a free home site. That home site is going to stay free.
Dumenco: If the studios and the networks, which still have a relative ton of money to spend even in this economy, still feel compelled to do their big Emmy and Oscar campaigns, well, why are the trades not doing better if that chunk of their endemic base is theoretically still there?
Waxman: Because the studios made a conscious decision: 'We do not need to be here anymore.' A lot of this is relationships. I mean, why are you advertising in the trades? It's to satisfy the director of the movie or the movie star or the agent at CAA. But I think the strike in the industry and the recession gave the studios an excuse. The studios are looking for reasons to not spend.
Dumenco: You were a print journalist for so long. Did you see all of this happening? When did you see it coming?
Waxman: When did you see it coming?
Dumenco: Well, I've been doing online stuff since the early '90s -- while still being involved in print, I was launching digital properties -- so I guess pretty early on.
Waxman: I started seeing it I guess, wow, let's see, I'm gonna lose track of time -- two-and-a-half years ago, probably. We started having, like, salons at my house. It started with what I called "Let's have a pity party," because everybody was starting to get laid off and the numbers were so depressing and there was nobody who was in print -- my friends at newspapers all over the country -- nobody who wasn't feeling that we were just getting beat up, getting beat up by the bloggers. You could see that the newspaper business model didn't really make sense anymore, so I had a "pity party" -- like a cocktail party -- and I invited people from the L.A. Times, the Wall Street Journal, the New York Times. You know, just a bunch of journalists, and it was just, like, let's just commiserate together because it just feels like shit.
A lot of people showed up because in L.A. we don't really have much of a sense of community among journalists. And from there I started having meetings with smart people, smart journalists -- just talking about what was happening with journalism and what it was that we might do to kind of help the situation. All this started before I went on book leave. In July of 2007 I went on book leave for six months, and then I quit in January of 2008. At the end of my leave, I was supposed to move to New York and start writing for Metro [the Metro section of the New York Times] but I'd started sketching out different business plans and I took it to a few different investors. I'd literally taken a legal pad and wrote down what I could do: Lectures, start my own site, blog, get another job, move to New York -- it was a juncture for me in terms of my career, I had been working for 20 years, I just finished a book, my kids didn't want to move to New York, my husband agreed.
Dumenco: What does your husband do?
Waxman: My family has a company that is into the plumbing and electrical supply business and he's the director of international sales so he travels a lot.
Dumenco: How old are your kids?
Waxman: My kids are big, actually. So my daughter just graduated high school, one son is 15 and one son is 12.
Dumenco: Not a good time to move across the country.
Waxman: Not a good time to move. But it's a good time to start a company because they're big enough -- I mean, I've been working from home their whole lives anyway and I started The Wrap from the house. Anyway, so it's a long way around to say that basically in January of 2008 I decided to take the leap. And I found a finance person to teach me everything I needed to know about finance. It was like kind of getting an MBA last year.
Dumenco: Are you still working out of your home office?
Waxman: We took an office in July. The new offices are only at the end of my street -- not very far.
Dumenco: How many people come in?
Dumenco: So you walk down the street with your morning cup of coffee?
Waxman: No, I still stay home. The office is pretty small. We didn't budget for an office. I actually intended the entire company to function remotely because the whole idea was, let's just get a bunch of really fantastic journalists who are good at what they're doing, know how to do their jobs, and let them loose to do it, build a great content-management system to let them post their stories, and editors to be there to basically shepherd this fantastic content. It turns out that was really simplistic. It turns out we needed an office. Editors have a much bigger function than I gave them credit for. Like, I mean, when there's breaking news, we need to communicate fast how to get it out. You just kind of need a nerve center.
Dumenco: Let me ask you a general question about how this has changed you -- you personally. I mean, I know for some print people who are becoming digital people, by choice or by force, it changes their metabolism in sometimes uncomfortable ways. It can make you more neurotic, more high-strung, "always on."
Waxman: Well, I'm really happy. I wasn't really happy before. You wake up every day really excited about what the day might bring. It's a good place to be, to be building something that's working in a space where there's a need for it.
Dumenco: You weren't happy specifically why?
Waxman: I mean, do you know many journalists at print newspapers who are happy? Do you know many New York Times reporters who are happy? Newspapers aren't particularly happy working environments.
To learn business and to learn about managing, which is something very new to me, and to learn about where the limits are and where the opportunities are as a journalist, you know, it's not always fun every minute but generally just the idea that you're getting to grow, that's the best part of it. It's so much better than doing the same thing at a newspaper.
What has been a revelation to me is how much one can accomplish by just putting one foot in front of the other. It's something you teach your little kid, but it's actually true for those of us who are trying something new. It's true for us too.
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Simon Dumenco is the "Media Guy" media columnist for Advertising Age. You can follow him on Twitter @simondumenco