Salon, Rolling Stone Publisher in Financial, Editorial Pact
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Struggling Web publisher Salon Media Group secured a $200,000 investment from Wenner Media, publisher of Rolling Stone magazine. The deal also includes plans for Rolling Stone and Salon to collaborate on coverage of the upcoming presidential election.
"Everyone at Salon is...very excited about collaborating with Rolling Stone, which has a rich history of political journalism, on a series of major news stories during this crucial election year," said David Talbot, founder and CEO of Salon. "Salon's partnership with Rolling Stone is full of great promise."
Wenner Media Chairman, Jann Wenner, will join Salon's board of directors. Wenner, who is also editor of Rolling Stone, is known for his left-leaning political stances. He told a New York University gathering this week that Howard Dean, the Democratic front-runner, would be featured on next month's Rolling Stone cover. When asked if it were an endorsement, Wenner said officially, it wasn't, but unofficially the cover story makes clear where his loyalty lies.
Salon, also known for its liberal leanings, has established itself as a well-respected online journalistic voice, though it's been less successful in eking out a profit. The company, founded in 1995, went public in 1999. It's been dogged by rumors of imminent demise for the last several years. When Salon last reported earnings, in September 2003, it claimed quarterly earnings of $1 million, but reported an equivalent net loss.
Salon survived in part by attracting financing from wealthy investors. Around the same time Wenner Media took a stake, longtime investor and board member John Warnock plowed another $600,000 into the firm. Warnock is founder and co-chairman of Adobe Systems.
The company has experimented with a number of different revenue streams in an effort to stay afloat. Most recently, it's focused largely on a subscription model, supplementing those revenues with a program that allows advertisers to sponsor one-day passes to access the content. Salon says it has more than 73,000 subscribers to its Salon Premium Service.