Where Analysts Fear to Tread
How to Piss on Demand
The Motley Fool is about as mainstream as you’ll find amateur stock market analysis.
Sometimes the fools are amazingly astute and other times they can be wildly off the mark — though the same can be said of professional analysts too.
What’s abundantly clear, in the Fool’s most recent 1-Star Stocks Poised to Plunge piece on Demand Media, is that it doesn’t take much work to see through the hype being foisted on the public by Rosenblatt and DMD. All other complaints aside, this company is not some revolutionary new media business model. Just ask Hollywood Dan …
HollywoodDan (91.18) Submitted: 2/8/2011
Just have to hate a business model that has a bunch of rich d-bags paying “freelancers” a pathetic $15 a pop to make them even richer. Really dislike this company, and as a consumer do not trust their content.
… or ask georcole …
georcole (82.74) Submitted: 3/4/2011
If DMD actually raises the bar on the quality of their information, they will have to raise the amount of money that they pay to the authors. As it is, they only pay them something like $15.00 per article and pay it out over five years!! No wonder all they get is low quality junk. And if they pay out more for higher quality, how will they make money then? I think the idea behind the company is good, but the execution is really bad.
For those of you participating in the DSS forums, none of this analysis is new. We’ve been saying the same here for months on end. I’ve been wrong thus far about the resilience of DMD to hold up to the lofty IPO heights. I’ve got nothing ventured on this one, because as they say …
The market can remain irrational far longer than I can remain solvent.
I take offence at people calling all of DM’s output “low quality junk”. Believe me, some of the bigger players don’t pay an awful lot better, it beats working some other tinpot crap job (when times are tough as a freelancer I use DM as a fallback and I’d rather do that than stack shelves for ~$10/hr plus commuting costs).
Many some rubbish makes it through (but then again, read the Huffington Post and you’ll see things aren’t much better) but I *do* write about things I know and *do* research, so I believe *my* articles are not *junk*.
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Wait, we’re talking about investment advice… but a company who pays its workers poorly while the executives get rich is a bad investment? That must be why Walmart went out of business…
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Leaving aside the issue of whether DMS as an investment choice (especially since I agree that the company is overvalued by a wide, wide margin), this is a pretty solid example of how this website focuses on negative, DMS-basing to such an extent that it is happy to republish factual errors and outright lies.
In this example, this georocle who DSS thinks is an expert of some kind can’t be bothered to either get his facts straight or express them properly. What he says in the quote above is that DMS writers are paid $15 per pop (true) over five years (not true – the payroll is amortized over five years, a point discussed ad naseum on this very blog).
You guys have NO credibility, and this is a great example of why. You are a bunch of bitter, small-minded, incompetent hypocrites.
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georcole seems to be under the impression that DMS pays the writers over a 5-year period, rather than paying the writers upfront and then hiding the expenses over a five-year period. It’s nice to see criticism of Demand, but I take it much more seriously when it comes from people who have actually bothered to look up the basics of how the company works and how writers get paid.
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I didn’t know how to address that inaccuracy, so I’m glad you called it out Marsha. It may have just been a poor choice of words. Just imagine if they did pay out $3/yr over 5 years … where would they find writers then?
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Isn’t that basically how rev share works? They still have people willing to do that.
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I wonder what the distribution of writers/articles is between up-front payment and rev share? Demand could provide those numbers, but they never would. I’d guess that less than 20% of their writers do the rev share.
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