Web Review to fold; blames ad revenue

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Songline Studios on Friday published what it said was the last issue of its Web zine Web Review, unless it can convince readers to kick in a subscription fee.

In a letter posted on its site, Web Review Publisher Dale Dougherty wrote that "the advertiser-supported model isn't really covering costs for targeted publications, and Web Review--whcih requires a dedicated staff of editorial, design, production and technical resources--is expensive to produce."

The letter goes on to ask readers to pay $19.95 for six-month subscriptions to make up for its revenue shortfalls and sustain production costs.

The service needs a minimum of 5,000 paying subscribers (about 10% of its assumed population) in order to manage its costs, according to the letter. If that happens, the site will resume its daily publishing schedule in June.

The publication has two persistent challenges, said Eric Lundberg, director of advertising: the cost of creating original content and the fact that advertising on the site, even if all "availabilities" were sold, would still not make it break even.

Web Review maintains a 10-member staff, three of whom are dedicated to daily original reporting; the site doesn't use wire feeds or content deals to create its editorial.

In late 1995 the Minneapolis-based Utne Reader, a monthly digest of alternative press articles, encountered similar problems when it tried to produce a Web site with 100% original content. While Utne Reader's site didn't shut down, management conceded that the site would have to repurpose magazine content and raise ad rates slightly.

Web Review has worked with at least 20 marketers to date, and has 10 advertisers now. Ad rates are $240,000 per year or sold in monthly packages of $26,000 to $40,000 per month. Impressions are guaranteed, and the average click-through rate is 7.9%, according to Mr. Lundberg.

"We've made a decision that we cannot support publication of Web Review as it's published now," he said. "If we did sign a minimum of 5,000 people, we could continue." He added that, once the brand becomes a subscription-based service, ad rates would not likely increase.

Copyright May 1996 Crain Communications Inc.

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