The latest attack on Bleacher Report came last week in a long SF Weekly article, which said that the network “floods the web with inexpensive user-generated content” and is “a long way from any quaint notions of journalism.” The story includes a number of examples of what it says is the kind of sloppy writing that comes from BR’s volunteer contributors, and the author criticizes the network for focusing on cheap SEO (search engine optimization) tactics, such as “reverse-engineering content to fit a pre-written headline” that is stuffed with popular keywords in order to attract clicks.

Unpaid writers “competing for virtual crumbs?”

The SF Weekly piece also spends a lot of time talking about how a majority of Bleacher Report’s traffic is driven by unpaid writers — like the 19-year-old who admits to author Joe Eskenazi that even he doesn’t really buy the headline on his post. The obvious implication is that the network is nothing but a content farm filled with day laborers who churn out posts to fill a quota, and are encouraged by the “virtual badges” they earn for posts rather than an actual salary. As the piece describes it: “Unable to earn actual crumbs, they compete for virtual crumbs.”

Ryan Chittum at the Columbia Journalism Review characterizes the network in much the same way in a post based on the SF Weekly piece, saying Bleacher Report is engaged in a “race to the bottom.” As he puts it:

“Bleacher Report is a sort of Demand Media of sports, a content farm engineered to get search engine visits with lowest common denominator clickbait.”

These criticisms about Bleacher Report aren’t really a surprise — after all, they have been made about virtually every other digital-media entity from Demand Media and The Huffington Post to BuzzFeed: the idea that user-generated content is just a sop to readers in an attempt to bolster SEO-driven metrics, and that it is an endless rush towards the bottom with little or nothing of actual value to add to either media or journalism.

And as the SF Weekly story notes, even Bleacher Report insiders to some extent acknowledged this: the magazine quotes from a speech given by King Kaufman, who was hired last year by the network to upgrade its editorial standards, in which he says that BR had gotten a reputation for “lowest-common-denominator crap.” Of course, the article also fails to mention that Kaufman and his team have spent a considerable amount of effort on boosting the quality of the network, to the point where it is actually more stringent about things such as plagiarism than mainstream outlets like ESPN.

An alternate route to a career in writing

Not only after the SF Weekly article appeared, someone else added an interesting — and I think important — perspective to the picture: Matt Miller, a senior writer for Bleacher Report’s NFL unit, described how he went from being a would-be sports writer with no experience to a member of the senior team at the network, based solely on his contributions to the site. As he put it:

“Fast-forward to today. I’m no longer in marketing, I now work full-time for Bleacher Report as an NFL Lead Writer. I have benefits and vacation time. I have a salary. I have these things because I was able to work my way to the top at B/R. I wasn’t handed a job based on my résumé.”

This is part of the problem with the traditional media response to “content farms” or user-generated media sites like Huffington Post and Bleacher Report — the sense that they can’t possibly be as worthwhile as a regular content operation because people are writing for free, and therefore the only possible value has to be the creation of low-quality content for cheap traffic purposes. But what about the writers? Why do they do it? And isn’t there value there as well?

Miller’s account makes it clear that there is value: unlike the old days of traditional media, where writers had to toil for years in dead-end jobs with newspapers or magazines or trade publications before some of them could be “discovered” and elevated to the higher ranks of the profession, sites and networks like Bleacher Report, Huffington Post and BuzzFeed give anyone the ability to rise to whatever level their writing ability justifies.

Is the content produced by places like Bleacher Report the equivalent of a mainstream outlet like ESPN or the New Yorker? In most cases, no — but does that mean it is of no value? Of course not. Readers seem to like it, and who are we to say they are wrong? Not only that, but Miller makes the point that he and many other writers see a lot of value in what they have done, even if that value isn’t recognized by members of the mainstream media, because it allows them to bypass the traditional barriers that used to encircle journalism. And isn’t that ultimately a good thing?

Post and thumbnail images courtesy of Flickr users D. Miller and Yan-Arief Purwanto

The round was led by Oak Investment Partners, the VC firm that has also invested in media companies like the Huffington Post, Bleacher Report and Demand Media, and Oak’s Fred Harmon will join Thrillist’s board of directors. Lerer Ventures and Pilot Group also participated (Thrillist founder Ben Lerer is the son of Lerer Ventures’ Ken Lerer).

Thrillist launched in 2005 with under $2 million in funding from the Pilot Group. The company now publishes email newsletters in twenty markets, has over five million subscribers and says it’s “on pace to approach” $60 million in revenues in 2012, compared to $33 million in 2011. About 30 to 40 percent of Thrillist’s revenue is derived from advertising, with 60 to 70 percent coming from JackThreads clothing.

The company plans to use the new funding to build out its current content business, develop mobile and expand into “new commerce categories.”

Thrillist has “big plans for evolving the Thrillist experience on the web, as well as on mobile and in video,” said cofounder Adam Rich. “We also have significant aspirations to continue developing JackThreads into a lifestyle destination that doesn’t just sell products, but also perpetuates a lifestyle that we know our guys covet.”

Michael Blend, who had overseen the company’s content and media services, has been promoted to president and COO and will now oversee the domain registration services as well. “Michael’s leadership will be instrumental as we continue to build upon our successful growth in content and media, as well as embark on a new era of internet domain expansion,” said chairman and CEO Richard Rosenblatt, to whom Blend will report.

Separately, Demand Media announced revenues up 17 percent to $93.1 million for the quarter. The company also broke even for the first time, with earnings of $0.00 per share, compared to the net loss of $0.03 that analysts had expected.

Revenue from content and media grew 18 percent over last year, to $55.3 million. Revenues from Demand Media’s registrar services, which includes domain name registration, grew 13 percent to $33.4 million.

Release

Contrast this with Wednesday’s launch of Demand’s latest “premium” video channel on Google’s YouTube platform, eHow Pets. Overnight, Demand seems to have evolved from pestilent content farm into trusted partner, with YouTube now funding three Demand-produced video channels through its premium content initiative.

Demand Media has been programming content from its legions of video bloggers on YouTube since 2007, and now touts a total audience of more than 7 million unique users on the platform per month, with over 3.6 billion views, according to comScore.

However, beyond eHow Pets, and also including the previously launched eHow Home and Livestrong Women, Demand’s premium channel entries seem incongruous with what you’d expect from the publicly traded company’s traditionally distributed workflow — which features thousands of nameless freelance content producers filing service articles and videos for compensation that might, if they shop carefully, cover their lunch bill.

For example, one of the more prominent personalities on eHow Pets is Victoria Stilwell, a British dog trainer and author who — while not approaching the fame of the Dog Whisperer himself, Cesar Millan — has appeared on various CBS and Animal Planet pet-themed shows. Meanwhile, a new series on the eHow Pets channel, the ironically titled Farm Raised, is hosted by P. Allen Smith, who Demand officials call the “Martha Stewart of the Midwest” even though he’s from Tennessee. He’s a well-known gardening expert who once had his own weekly syndicated home-improvement/lifestyle show.

Sure, these are not A-list talents, but they’re not laid-off newspaper writers filing stories for $15 a pop out of their apartments, either.

Demand CMO Joanne Bradford said that video content for Demand’s three premium channels is produced out of the company’s Santa Monica studios. She would not disclose, however, how many full-time staffers are involved behind the scenes with  production for these channels.

With Google introducing big-name sponsors like Toyota to Demand’s premium video offerings, the company’s studio is presumably enticing talent and production staff with compensation that exceeds content farm levels.

“We’ve changed our model,” Bradford conceded. “Our goal is to pay as much as we can to create the best piece of content out there.”

The Chicago Tribune recently laid off many of the reporters and editors who produced its hyper-local editions, and announced that it was outsourcing those functions to a startup called Journatic — a move that drew criticism from those who saw the company as a Demand Media-style “content farm,” replacing journalists with algorithms and poorly-paid freelancers. In an interview with GigaOM, however, Journatic CEO Brian Timpone said that not only is his model more efficient than that of a newspaper, but it can actually help produce better journalism.

Timpone — who got his start as a journalist working for TV stations and broadcast affiliates in Duluth, Minnesota and Springfield, Illinois and at one time owned several community newspapers — said he got the idea for what became Journatic after the dot-com bubble burst in 2000, when he started a content-management service for newspapers (Timpone also runs a data-driven real estate service called Blockshopper). He said that at the time, he was fascinated with the difference in market penetration between smaller community papers and large metropolitan papers:

[I]n Chicago, the penetration is so low, but in a small town it can be huge. So I started thinking about how you can build higher penetration in those kinds of markets… there are suburbs of Chicago with 50,000 people and there’s no newspaper at all, not even a weekly.

The Journatic founder said that he reacted negatively to suggestions that his company is a “content farm” because he believes it is completely different from what someone like Demand Media does, which involves aggregating information in the hope that it will do well in search. “We produce a ton of content, but we are completely different,” Timpone said. When asked how many stories or items Journatic produces, he said he couldn’t say exactly but it was in the range of “tens of thousands a month, and growing quickly.”

A lot of community news doesn’t need a reporter

What the company produces for clients like the Tribune — and a number of other papers such as the San Francisco Chronicle and the Houston Chronicle — is community-level news, Timpone says, but it is able to do so much more efficiently:

The base of community news is what they call in the industry ‘process news,’ and it doesn’t really require a reporter, it just needs some cleaning up. This is not some new concept, it’s how community news has worked for decades. Who makes community news? Churches, schools, municipal governments, all the town councils that have 5 meetings a month where no one ever goes to them. This is the same stuff you’d read in a community newspaper in the 50s.

Some of the information that Journatic generates — which turns into stories like the ones at a TribLocal site for the suburbs of Homewood and Flossmoor, which it has taken over producing from the Tribune — comes from press releases issues by schools, or various community groups. Journatic gets a lot of this the old-fashioned way, says Timpone: by calling people on the phone or emailing them. “We talk to the women’s club or the church or the school — so it’s a lot of elbow grease.”

The company also does a lot of data collection in various ways, including Freedom of Information Act requests, says the Journatic CEO. “We get foreclosures and other data through FOIA and then we clean them up. We have a big document collection team, and we know how to get that data. One problem newspapers have is their reporters just don’t have the time to do that kind of thing.” Journatic gets building permits and child-support records and other data as well, he says, and much of it comes through digging. “When it comes to small towns, almost nothing is on the internet, so we can’t just scrape a website. We have to go out and get it.”

Much of the negative commentary about Journatic has come because the Tribune laid off 20 of its staff, and replaced them with a company that reportedly pays freelancers $2 to $4 to write a story, or about $12 an hour. But Timpone says those fees are for “part of a story.” The Journatic model, he says, is a process in which different aspects of the package are generated or produced by different people. So one person might come up with the source material, another might write a paragraph or two, another would add links and another might do some editing (some of which is done in the Philippines).

It’s like an assembly line, we assemble stories from these different parts; we have people who just source stories, who just generate story ideas, we have people who just generate ledes, and so on. We have 200 different types of stories — some are deep features. But if we re-process a press release, why would anyone pay reporter-type wages to do that?

Journatic says it helps journalists do better journalism

Timpone said he doesn’t like to think of Journatic as displacing journalists — he thinks of what he does as making it easier for them to concentrate on doing the things they are good at, instead of writing up press releases about school awards. “This is a company of journalists,” he says. “It does not make me happy when anyone gets laid off. But if we don’t do it, then the future doesn’t look good. We can’t keep doing it in the way that we’ve been doing it.” One client newspaper that the company started working with, he says, had a team of 11 reporters for 11 different community sites, but they only produced about four stories per person per week:

That’s not because they were lazy or weren’t capable, it’s because they were spending all their time on process news, the type of stuff we do. Why not get that stuff off their plate so they can focus on what they are good at, like breaking news or human news? Writing about the high school honor roll is a waste of their time.

The Journatic founder said that what he does is help companies like the Tribune produce content on a community level a lot more efficiently, and that allows them to reach those markets and engage with readers directly at a much lower cost — which in turn allows them to do more of that kind of news, but also frees their reporters up to do more important stories. And the data that Journatic comes up with from its automated processes can build databases that those reporters can use to do better journalism.

It’s not just fodder to fill the paper, it’s the foundation of better local journalism. We’ll have probably 100 police blotters indexed this year, that information has never been collected systematically before, when reporters get access to that it can help them produce better stories. This is a road to a new kind of journalism… a better kind of journalism. That’s the vision.

Will Journatic’s assembly-line, data-driven process enable newspapers to spend more time and resources on real journalism or better journalism? Or will cash-strapped owners simply use it and other services such as Narrative Science’s story-writing algorithms to reduce their costs and improve their profit margins as advertising revenue continues to decline? That’s the question many journalists are concerned with, and it’s something Timpone can’t answer. All he knows is that his way is more efficient.

We’ll be talking about these media issues and more at paidContent 2012, May 23 in New York City.

Post and thumbnail images courtesy of Flickr user George Kelly

The company, which includes sites like eHow and LiveStrong, built its business by using thousands of freelancers to create websites tailored to attract drive-by search traffic. In doing so, Demand Media was tagged with the “content farm” label, a perception that was reinforced last year when Google downgraded it in its search listings.

A note in today’s financial statement suggests the company is attempting to weed out some of its lowest grade content:

Q4 2011 and full-year 2011 loss from operations and net loss includes $5.9 million of accelerated non-cash amortization expense associated with content intangible assets removed from service in conjunction with the Company’s previously announced plan to improve its content creation and distribution platform.

These write-downs led Demand Media to post an overall loss for the quarter, but its operating income was positive and beat analyst expectations. The company said it expects revenues to be between $78 million to $80 million in the current quarter.

Demand Media also makes money through companies that buy and sell domains. Today it reported that it is investing $5 million so-called generic top level domains — the new internet naming rules that may result in a raft of new domains ending in, say, “.flowers” or “.nike”

The company’s domain name initiatives are unlikely to endear it with brand owners who are already struggling to fight off third-parties who squat on their intellectual property.

For a complete account of Demand Media’s results, including its financials, see this report via the Domains.

Larry Fitzgibbon, Joe Perez, and Steven Kydd — who had all been founders and EVPs of Demand Media (NYSE: DMD) — are to leave the company. All three had been with the company for seven several years — approximately 5.5 years.

paidContent first learned of the three founders’ departures from an anonymous source; the news was then confirmed by Kristen Moore, VP of corporate communications for Demand. She said that most of their duties will be passing on to Michael Blend, EVP of Media & Marketplace for the company, after a transition period of a couple of weeks.

Demand does not anticipate any strategic changes as a result of their departures, she added.

Fitzgibbon had overseen international operations, Perez was in charge of product and Kydd was EVP of video — a huge portfolio if you look just at those category names.

Kydd’s departure as the head for video comes at a crucial time for Demand, which will be one of YouTube’s partners for its premium-content video effort launching this year.

Fitzgibbon’s responsibilities for international, meanwhile, will be partly overseen by one of his former reports, Stuart Stewart Marlborough, an SVP who is based out of London Santa Monica. He will report to Blend.

Update: there is now an 8-K filed for Fitzgibbon that detailed his departure terms. All three owned equity in the company, but Kydd and Perez had “not enough to trigger the 8-K,” said Moore:

In connection with his resignation, Mr. Fitzgibbon entered into an Executive Separation Agreement and General Release with the Company dated as of January 27, 2012. The Separation Agreement provides that Mr. Fitzgibbon will receive the following benefits in connection with his separation from the Company: (1) accrued but unpaid base salary through the date of separation, (2) his accrued bonus at 100% of target for 2011, in an amount equal to $125,000, (3) twelve (12) months of continued COBRA coverage and expense reimbursement under the Company’s Executive Medical Reimbursement Plan, (4) acceleration of 21,750 of his currently unvested restricted stock units and (5) one year to exercise vested but unexercised stock options outstanding as of the date of separation.

According to Moore the fact that the three departed at the same time was “just coincidence.” The departures, she said, had nothing to do with contracts around the company’s IPO — that lock up, in fact, expired in August last year. She added that the three will “pursue separate opportunities and new business ventures” but did not provide further information.

We’re still looking into the story, and will update it as we learn more about the three executives’ future plans.

Demand Media is due to present its Q4 results on February 16.

Other founders of Demand are remaining with the company. They include CEO Richard Rosenblatt, head of M&A Shawn Colo, and EVP Courtney Montpas.

Cox is the sole investor in the company.

It looks like the investment for Cox, which owns 15 TV and 85 radio affiliate stations in some 22 markets across the U.S., is a strategic one, as it looks to develop more interactive and rich content for its advertisers, particularly on digital platforms as advertising in more traditional media formats like those it operators continues to be face declines as newer forms of media take away the attention of viewers and advertisers. The company reported $1.8 billion in revenue last year.

An as-yet unnamed Cox executive will also join Skyword’s board of directors.

Skyword says it already produces thousands of pieces of content for a “search and social driven world,” which it generates and distributes through its own platform. Cox’s affiliates could potentially become alternative sources for distribution for those pieces of content.

Content farms like Skyword and its bigger competitor Demand Media (NYSE: DMD) have been accused of producing low-grade content for the lowest bidder — a charge they are trying to work off as they grow in prominence as businesses.

“We do not just create content for search engines,” said Demand Media CEO Richard Rosenblatt. For instance, he said, Demand Media is creating “the same kind of content you see on cable” for YouTube. Demand recently partnered with home and garden expert and TV show host P. Allen Smith to create the “eHow Home Channel” on YouTube.

“Every single leading company is waiting for user-generated content or is licensing content” in order to reach advertisers, Rosenblatt said. “YouTube was tired of waiting. They told us that they needed a home and garden channel, a pets channel and a health/Livestrong channel. They are paying us up front, plus a rev share. This is the beginning of them funding professional content creators.”

“Domains are looking for content and looking to grow their audience,” he added. “Take Engadget. They may not have enough tech content. We could give them the content.”

It is more profitable for Demand to run content off-network than to host it on its own site, said CFO Charles Hilliard, because the company avoids some overhead and personnel costs. Partly for that reason, Rosenblatt said, Demand is “relatively agnostic” as to where consumers find its content. “We think about the web in this open, federated way,” he said. “If you know the consumer demand and create the content, consumers will find it, or it will find them.”

Yesterday, Demand Media said that Q3 revenue gained 26 percent, though its losses widened to $3.3 million from $900,000 the year before.

While the company did manage to reduce traffic acquisition costs as a percentage of its revenue, it will simply have to spend more time– and probably money — developing better content. And that means going beyond celebrity deals with the likes of content partners like Tyra Banks and Rachael Ray or recent purchases such as IndieClick, which helps produce independent blogs in areas of fashion and culture.

Demand Media’s best-known business, eHow, has continued to see traffic growth for three straight months. And many believe that Demand needs to move away from what eHow does best — produce low-cost, keyword driven “how-to” articles — in order to establish real credibility. The company has been making some moves to try to address the very uneven quality of its Demand Studios freelance network. At the end of the summer, Demand freelancers received an email telling them that writers with low grammar scores would be placed in the Writer Evaluation Program (WEP).

At the same time, Reuters reported that Demand is in the process of scrapping articles that are deemed to be inferior. That could cost Demand Media $8 million in write-downs, a sign that at the very least, the company is aware of the perception issue and that it is willing to pay to try to fix it.