The Huffington Post Plans for Expansion Despite Setbacks
Article by Natalie HIDEG • Published 28.11.2011 • Updated 19.12.2011
[News] Arianna Huffington's website, The Huffington Post, has grown into a force to reckon with in the world of online journalism. Within the past year, though, it has had to deal with a number of setbacks, threatening overseas development. A look at these issues and their implications for its future.
Arianna Huffington has grand ambitions. The co-founder of The Huffington Post, having already launched successful sites in the United States, Canada, and the United Kingdom, intends to open up her popular blogging and news aggregation website to the French market in early 2012, and has recently revealed plans to expand to countries including Italy, Brazil, Turkey and Spain in the forseeable future. The left-leaning website, which publishes more than 100 articles per day with advertising as its only source of revenue, combines opinion blogs with news and information, promoting the idea of “participatory journalism,” produced by unpaid writers and bloggers, alongside paid journalists. Following a February 2011 merger with AOL worth $315m, Arianna Huffington became president and editor-in-chief of The Huffington Post Media Group, heading up, along with her own website, several of AOL’s already existing online properties[+]. NoteSuch as Engadget, TechCrunch, Moviefone and Politics Daily. . As of Nov. 2, 2011, AOL registered 37 million unique visitors to The Huffington Post’s websites. And yet, there are a number of obstacles in Arianna Huffington’s path, possibly putting a permanent hold on her site's potential for overseas development. Not only is the financial stability of the website compromised, but because of many legal battles currently underway, its reputation could be at stake as well, making it difficult to break into distrustful markets.
This past year, notably, has been far from worry-free for Arianna Huffington, legally speaking: three lawsuits were brought against her and her company, none of which have yet been resolved, and which may jeopardize the future of The Huffington Post.
In the world of opinion blogs and citizen journalism, bloggers and amateur writers are aware that oftentimes their work is only symbolically paid (or not at all),-- but in return, they are getting real-world experience and the opportunity to publish their pieces and promote their ideas on an international platform: this is Arianna Huffington’s response to a class-action lawsuit sought by Jonathan Tasini on behalf of all unpaid bloggers for The Huffington Post. Affirming that the website would never have been a success without contributions from bloggers, Tasini claimed that out of the money Arianna Huffington made from the merger, $105 million was the estimated value of unpaid writings (and Huffington kept 75% for herself).
Also in reaction to the AOL/Huffington Post merger, the website Visual Art Source decided to go on strike from The Huffington Post in March 2011, no longer contributing material to the website, and calling for all Huffington Post bloggers to stop providing content. The Newspaper Guild and the National Writers Union (NWU) both followed suit by officially boycotting the website, urging bloggers to refrain from posting content until a pay schedule be instituted. Adbusters, an anti-consumerism organization that claims to have contributed to the early development of The Huffington Post, joined in the boycott as well in February 2011.
However, the NWU and The Newspaper Guild each released a statement in October 2011 ending the boycott, saying that it had “run its course,” and that, after negotiations with The Huffington Post, "(unpaid) bloggers [are] no longer being assigned stories or expected to cover news." Many feel that this abrupt end to the boycott was an unsatisfying solution to the situation, and that rather than reaching a concession with The Huffington Post, as their press release contends, the unions simply backed down. The Newspaper Guild claims that a line has been drawn by The Huffington Post distinguishing paid news writers from opinion bloggers; if this is true, the line is very thin. The Huffington Post’s upcoming citizen journalism projects- notably “Eyes and Ears” and “Off the bus 2012”- for next year’s US presidential elections will primarily use the work of bloggers, proving that, while not officially giving bloggers assignments and asking them to cover news, this is unarguably what they will be doing.
Unpaid bloggers aren’t the only “little people” to bring up longstanding beef with media mogul Arianna Huffington. She and co-founder Kenneth Lerer are being sued by political consultants Peter Daou and James Boyce for stealing the original idea for The Huffington Post. They claim to have worked with Huffington and Lerer in 2004 in developing the conception for the project and its platform, contributing “groundbreaking” ideas with the understanding that they would be included in the continuing development of the project. They were not, and in November 2010, filed their complaint[+] NoteTheir complaint was filed around the same time as the release of “The Social Network,” a film about a similar lawsuit that involved Facebook’s Mark Zuckerberg, although Daou and Boyce claim their case has nothing to do with the film. . Dismissing seven out of eight claims, a Manhattan judge nevertheless ruled on Oct. 26, 2011 to allow the case to go to trial, giving the consultants a chance to prove that the ideas they contributed were original and essential to the project. If the plaintiffs are awarded damages, it is still unclear whether or not AOL will be dragged into the lawsuit. If revealed, the details of The Company Disclosure Schedule signed during merger negotiations will be critical in predicting the hand AOL will play in this matter.
The most recent lawsuit brought against The Huffington Post, filed by The New York Times on Nov.4, 2011, accuses the website primarily of trademark infringement, amongst other charges. The newspaper alleges that blogger Lisa Birkin, who recently moved her blog to The Huffington Post, intended to confuse readers into believing the two blogs were one and the same by changing the original name Motherlode to the similar Parentlode. The New York Times claims to have lost readers in the confusion, and demands that The Huffington Post change the name of its blog, which it has refused to do. As of yet, no potential financial damages have been made public, although a loss in court could be another blow to the reputation of the website, potentially hindering its integration into foreign markets.
Tim Armstrong, chief executive of AOL, predicted in March 2011, that “in the second half of this year, you are going to see AOL growing at industry rates." Unfortunately, while Arianna Huffington is plowing forward with big spending plans for the expansion of her site, AOL is actually losing money. Third-quarter figures show a loss of $2.6m, or 6% in total revenue. And launching new sites in other countries costs a pretty penny, regardless of "cheap labor" bloggers; it still requires hiring journalists and editors to manage the sites, filter the information, and write news stories. In an interview with El Pais, Arianna Huffington said that with her three existing sites she already has 1,400 well-paid writers; each new country site will then require approximately 470 or so new bodies to run. Huffington has already made a deal with French daily Le Monde and Les Nouvelles Editions Independantes to open a French language site, and also sits on the board of Spain’s El Pais-- evidence that she is committed to the forthcoming launches of two foreign language sites. But with its parent company losing money rather than banking it, if and when she is able to follow through still remains to be seen. The launch of the French site, originally predicted for November 2011, has already been delayed to the beginning of 2012, supposedly due to difficulties in finding a competent editor-in-chief, but in light of the current circumstances, financial difficulties may very well be a factor.
Despite these setbacks— reputation-damaging lawsuits, boycotts, and AOL’s fragile financial situation— Arianna Huffington and her team appear unfazed, and continue forward with their plans for expansion into several new markets in 2012. Their reactions to these hiccups demonstrate their business sang-froid and confidence in the future of their company. Since The Huffington Post has joined forces with corporate America, some of its bloggers have decided not follow Arianna to AOL, not wanting to write for a large corporation for free. But when Visual Art Source first went on strike, Huffington’s response- “Go ahead, go on strike”- indicated that she believed, with good reason, that no one would even notice the strike and that plenty of bloggers would be willing to step up to replace the strikers. When asked to comment on the “resignation” of long-time blogger Mayhill Fowler, who contributed a number of important scoops to the website, but who grew fed up with working for free, AOL Spokesperson Marco Ruiz replied, “How do you resign from a job you never had?” Thanks to The Huffington Post’s popularity and platform visibility for aspiring writers, their bloggers have become dispensable labor.
AOL continues to lose money and the reputation of The Huffington Post has surely been tarnished by bad publicity from the numerous lawsuits it is facing; it would seem, however, that whatever the outcome of these legal actions, The Huffington Post will come out triumphant. The Writers Guild continues to support their “Pay the Writer!” campaign, but having sheepishly backed out of The Huffington Post boycott, lacks credibility. And even though some bloggers have chosen to leave The Huffington Post to pursue more financially stable ventures, the departure of New York Times blogger Lisa Birkin for The Huffington Post is evidence that the relationship of confidence between readers, bloggers, and the website has not been completely destroyed. In effect, Jonathan Tasini, in his case against The Huffington Post, has only managed to find four other bloggers willing to testify and express dissatisfaction with their unpaid status. And lastly, with online newspapers such as The New York Times introducing paid subscriptions, online information seekers are frequenting free sites like The Huffington Post now more than ever.
The force that drives Arianna Huffington to establish her website as a soon-to-be worldwide staple in the blogging and news aggregation industry will push The Huffington Post forward regardless of the obstacles. As Huffington puts it, “Either you expand or you die,”: these seem to be the only options. The consequences of The Huffington Post’s past year of legal dramas and AOL’s prediction of financial collapse are insignificant; it’s not the company that is at stake, but rather, as Douglas Ruffkoff at The Guardian puts it, “the demise of the justifications for writing for free.”
Photo credits: Flickr; jdlasica
Photo credits: Flickr; jdlasica
- 1. Such as Engadget, TechCrunch, Moviefone and Politics Daily.
- 2. Their complaint was filed around the same time as the release of “The Social Network,” a film about a similar lawsuit that involved Facebook’s Mark Zuckerberg, although Daou and Boyce claim their case has nothing to do with the film.
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