Yesterday I happened to run across this rather positive assessment of Salon.Com’s financial position by Dot.Com big spender David Talbot in which he pokes fun at the pundits who have been predicting Salon.Com’s impending doom,
In fact, our impending non-existence has been predicted in the press for so long, and with such conviction, that we considered adopting “Die another day” as a marketing slogan until the Bond franchise beat us to it.
More overeager obituaries are certain to follow. But perversely, Salon still has a pulse. We’re still going strong because our investors understand that Salon has established the fundamentals of a solid business — including over 3.4 million monthly readers and more than 500 advertisers — and that profitability will follow, just as it did with successful cable channels as that medium established itself. And we’re still in business because more and more Salon readers are signing up as subscribers, after coming to the realization that the independent press — on and off the Web — can thrive only if readers (not global media giants or the government) help pay the bills.
Just before we launched our subscription service last year, one of the prophets of Salon doom, something called eMarketer, informed its readers that this was a last-gasp strategy: “Some analysts view this as a last resort that won’t last long.” But Salon still stands, in large part because of the nearly 50,000 readers who now subscribe — over 44,000 for Salon Premium and over 5,000 for the Well and Table Talk. In fact, more readers signed up for subscriptions in October than in any other month since we launched the Premium service — and November is shaping up as another record month.
So I was impressed. After all, Salon.Com’s revenue is now at about $4 million/year. At that rate, it will only take it 20 years for new revenues to total the almost $80 million its lost over the past few years.
But it turns out that not only was the subscription offering a last gasp after all, it didn’t work. According to a Wall Street Journal report,
The Wednesday filing said that until Salon reaches break-even cash flow, it will continue to use its cash on hand of $266,000, as well as $200,000 from a promissory note.
That’s right — a company that has spent tens and tens of millions of dollars has less than $300,000 in cash on hand and had to rely on a loan from one of its directors in order to avoid ceasing operations in October.
In fact, in its 10-q report, Salon.Com issued a warning that if it can’t obtain new funding or financing it may have to cease operations.
I’m certain given how thoroughly Salon.Com has covered the lies of companies like Enron, WorldCom, etc. as well as circled like sharks around mistakes, exaggerations and lies from people in the Bush administration, that some good folks at Salon.Com will take Talbot to task for publicly exagerrating Salon.Com’s financial position.
Sure, and pigs might fly.
Salon.com Launches Ad Program Michael Liedtkeday, November 19, 2002, Associated Press.
Salon Media Repeats ‘Going Concern’ Doubt. Dow Jones Newswires, November 14, 2002.
Salon celebrates its seventh birthday. David Talbo, Salon.Com, November 13, 2002.