Content Syndicators New Aim: Bucks
Companies that aggregate third-party news and information for Web publishers are now aiming their software and content products at large enterprises with corporate Web portals and intranets.
Its another example of a Net sector scrambling to readjust its business and stay afloat as the dot-com economy heads south. "Our customer base is effectively undergoing a transformation," said ScreamingMedia Chief Financial Officer David Obstler. "We are replacing the lower-quality Internet business customer with the higher-quality, higher-revenue-producing enterprise customer."
ScreamingMedia said it lost 175 small, poorly funded companies last quarter and expects "continued attrition" in the first quarter of 2001 to keep revenue flat. The shift is evident, however: Last quarter, 57 percent of the companys revenue came from the enterprise segment, up from 44 percent in the first quarter of 2000. AT&T, Bristol-Myers Squibb and Cablevision Systems are among ScreamingMedias newest clients.
ScreamingMedia expanded its suite of technology services, recently launched Syndication!Connect, which lets publishers aggregate news and entertainment and deliver it over many platforms.
Aggregator iSyndicate has doubled its penetration of the enterprise market over the last two quarters, and now derives 48 percent of its business from that sector, the company said. Last week, it bolstered its technology offerings by buying Kurion, which offers a platform for integrating Web applications into content quickly.
Web sites turn to syndication as an alternative to creating costly original content. Content producers that syndicate their wares gain an additional distribution outlet and often additional revenue. Increasingly, large corporations are seeking content beyond business news to keep visitors on their sites.
The new trend may sound a lot like an old trend gone bad years ago, known as "push technology," in which information was pushed to workers. The difference is back then nascent technology brought down networks and untargeted content made recipients steam, according to Charles White, vice president of content at syndicator NewsEdge.
"I dont think [todays syndication] is anything about push technology," said Cliff Pollan, president and chief executive of NewsEdge. "The biggest issue has become an overwhelming amount of information needs to be well-organized for end users."