The news about Blendle receiving €3 million from the news giants Axel Springer and The New York Times to further expand its “iTunes for journalism” business model echoed in the media industry in the last month. How could a 6-month old startup from the Netherlands succeeded to gain such attention? For MediaChange, Blendle's Thomas Smolders, responsible for the international roll-out and strategy, speaks about their challenges and further plans.
Blendle was launched a half a year ago. How many people are involved in this startup and which department is the strongest (sales, development, editorial...)?
There are currently 32 people working at Blendle, most of them doing technical work (front-end and back-end development, clipping the publications...).
How would you describe the main benefits of Blendle for publishers?
- No technical work on their side
- They earn 70% of what we make of their articles
- We can do lead generation for subscriptions after proven interest in their content
- Potential stronger position, especially in the younger part of the Dutch news market,
- Data dashboard: they finally get an insight in how much their 'paper' content is read
- They help a startup trying to build a new business model for journalism
Blendle was successfully introduced in the Dutch market. How difficult was it to persuade the Dutch newspaper and magazine publishers to take a chance with Blendle? What kind of feedback are you receiving from them – have their revenues from online content increased because of Blendle?
That was really difficult, especially because we couldn't show them anything in the beginning and they just had to trust us. After we had made a prototype, they were convinced that it might work, because Blendle is something you have to see and use, if you just hear about the idea it's quite vague. Their revenues definitely increased and what is even more important is that it didn't cannibalize with their other revenue streams.
The funding from Axel Springer and The New York Times will enable you to further expand your business. In your opinion, which markets have the greatest potential for Blendle? Are your target markets only the biggest ones, such as US, UK, Germany or do you think that you could also be successful in smaller countries?
It's not because a country is big that Blendle has more potential, The Netherlands are rather small as well. I can imagine Blendle working in the Scandinavian countries as well, although most of those countries only have about five million inhabitants each. We're working on the international expansion, but first we'll have to investigate where we could go.
In some other countries where paid content has already touched ground including Slovakia, Slovenia or Poland, most of the publishers develop their own paywalls or decide to implement Piano Media solutions. Have you heard of Piano? If you have, in what way does Blendle differ to Piano's online monetization solutions?
I have heard of Piano, but I didn't use it yet. What Blendle differs from most other paywall systems is that it lowers the threshold a lot, it's really easy to buy an article, as easy as it easy to buy a virtual cow in Farmville.
Based on your experience, are readers/media consumers more inclined to pay for quality content today than they used to be few years ago? Iit seems that the biggest problem that still exists is that they are used to get "everything for free" on the internet.
I don't believe that people are now more willing to pay that a few years ago, most of them wanted to but it wasn't easy at all: you had to take a monthly subscription, fill in a huge form to create an account… It's almost like publishers didn't want the public to read their articles.
Could you share information about which topics interest Blendle users the most and are prepared to pay for them?
The articles that are most popular in Blendle are background stories, analyses, long interviews… All content that is unique for a specific medium. People don't want to buy articles explaining what happened (they'll find this for free online), but why something happened, how it could have been prevented...
In your estimation there are about 20 % of Blendle users who top up their account. Is this enough for publishers (and for Blendle) to be profitable?
It will be enough if we have more users, but that's why we'll have to expand abroad.
Photo: Thomas Smolders (1992) is strategist at Blendle, responsible for the international roll-out. Before he used to work as a journalist for De Morgen, a quality newspaper from Belgium. He's currently doing a Master New Media & Society at the University of Ghent, Belgium.