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Discovery to buy HowStuffWorks.com

expand . . through acquisitions rather than building them from scratch

     
9:18 am on Oct 15, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



A deal for HowStuffWorks.com, which reviews consumer products and explains scientific phenomenon, is expected to be announced today, the paper said, citing Discovery Chief Executive David Zaslav.

Discovery to buy HowStuffWorks.com [reuters.com]

Good move?

11:51 am on Oct 15, 2007 (gmt 0)

WebmasterWorld Senior Member 5+ Year Member



sure. howstuffworks is a good site with truckloads of original content.
On the downside, they make you click through seven different pages just to read a single article. It's an affliction of mega sites, it seems. Probably gives them data on how many people finish the article. I hate it, and I hated it even more last year when I was on dial-up at home.
12:22 pm on Oct 15, 2007 (gmt 0)

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786000 pages = approx 150 000 articles
250 mio$ makes 318$ pro page/1600$ pro article
Nice price, Discovery I have a site to!
2:41 pm on Oct 15, 2007 (gmt 0)

10+ Year Member



On the downside, they make you click through seven different pages just to read a single article.

This is a great business model (my site does the same). Yes it is more work on the user's part but that is the cost for getting FREE content. Of course, this translates into more ad exposures

3:03 pm on Oct 15, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



Nice. I like to see this trend. It slows these quality content sites down... since they become part of corporate machine... and gives us little guys more room to catch up... ;-)

Regarding the articles spanning multiple pages... this is quite common in most site (we do it as well). More page views, and readers don't get overwhelmed with one long page of text.

3:07 pm on Oct 15, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



786000 pages = approx 150 000 articles
250 mio$ makes 318$ pro page/1600$ pro article
Nice price, Discovery I have a site to!

Depends on the context of the info on the page.

If you want to know how widgets work, how likely are you to be in the market for a new or better widget?

I believe the answer is "very likely." It's the basic Google ad model. And that, boys and girls, is how the Internet works.

3:25 pm on Oct 15, 2007 (gmt 0)



If you want to know how widgets work, how likely are you to be in the market for a new or better widget?

I'd guess "not very" in most cases, but that can be okay if the audience's demographics are desirable to mainstream advertisers, or the new owner--the Discovery Channel in this case--wants to promote its content to a targeted Web audience. (There's more to Web advertising than cost-per-click ads and affiliate programs.)

FWIW, this acquisition seems to have been cut from the same cloth as the Discovery-owned Travel Channel's purchase of WorldHum.com, a respected travel-narrative site that reaches the same kind of audience as the Travel Channel (i.e., armchair travelers, as opposed to active travelers who'd be easy targets for AdSense-style CPC ads).

Another interesting recent acquisition was Amazon's purchase of DPReview.com, the leading digital-camera review and community site. Of course, the potential linkage between "content" and "customer" is more obvious in that case than in the HowStuffWorks and WorldHum deals.

ADDENDUM: HowStuffWorks is already running ads for a Discovery Channel TV show.

4:16 pm on Oct 15, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



$250 million looks a bit high looking from a Traffic persepective (just 3 Million US uniques/month), would be interesting if someone leak the revenue figures... But anyway have to agree HSW is really a nice site!.
5:13 pm on Oct 15, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



ADDENDUM: HowStuffWorks is already running ads for a Discovery Channel TV show.

Looks more than an ad for Discovery, the main image is now Discover/HSW.

5:20 pm on Oct 15, 2007 (gmt 0)

WebmasterWorld Senior Member 5+ Year Member



318$ pro page/1600$ pro article

Great. Great! At that rate, my site is worth around $1,000,000 - pretty nice even when considering the current weak US$. Someone interested? Serious inquiries only, please. ;-)

7:14 pm on Oct 15, 2007 (gmt 0)

10+ Year Member



HowStuffWorks leverages the exclusive digital rights to over 30,000 books, 800,000 images and more than 180,000 maps

That alone ought to be worth a lot besides the 11 million unique visitors a month. Discovery can expose its TV channel to that many people each month. Think of how much they would save in brand building especially if the target audience is so similar.
8:38 pm on Oct 15, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



HowStuffWorks leverages the exclusive digital rights to over 30,000 books, 800,000 images and more than 180,000 maps

Well, that alone is not worth 250M

That alone ought to be worth a lot besides the 11 million unique visitors a month.

and that neither... I have 2 Mio. files / articles and a lot of them are unique or uniquely enhanced with reviews, etc. and I also have 4M uniques monthly... yet the site has not the last inch it takes to be evaluated so highly. Some feedback I had in the last weeks was that the status quo might be 500k, it is the story that counts and how good you are in selling the future.

VC lives on dreams, well aware that 95% goes downhill... but if you make 5% of your investments fly, all is good.

I congrat the guys at howstuffworks for that deal. I would evaluate the site somewhere between 20-40M but they obviously sold the story of their future for the tenfold - and, who knows, with that war chest and whatever the story is, it might become true!

Cheers,
P!

9:10 pm on Oct 15, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



It's very similar to About.com, but more intensive.

As someone who sold ads into this market, I took a look Howstuffworks.com and was impressed with their savvy.

They are doing what Google is aiming to do--getting the higher margin ad buyers interested in extensive online campaigns. Andersen Windows, Sony cameras, Sears Craftsman tools are a few ads I saw.

I love WW and trust and respect the opinions here. But, if I had one thing to say to the posters here, it is that NOW is the time to start looking at how television advertising is marketed to the bigger guns.

It's ALL coming to the web.

11:05 pm on Oct 15, 2007 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



>> it is the story that counts and how good you are in selling the future

Very True, Its really depressing when profitless (manytimes traffic less too) websites go for 8/9 digits :(, recent example Dotspotter

12:49 am on Oct 16, 2007 (gmt 0)

10+ Year Member



Great for them.

We had a traffic swap of sorts going with them last year for a bit. We do news and their content was good compliment and I assume vice-versa.

I seem to remember their traffic was about 2 to 3 times our own. But I cannot see on existing revenue how it could be worth 250m. I would guess huge future plans involved in deal. Also did not realise they had all that other stuff kicking about.

I have to say I was envious of the ever-green nature of a lot of their content. Much higher return per article than news stories. Still you do what you know I guess.

Someone will be happy with their $250m, is it cash?

[edited by: FattyB at 1:25 am (utc) on Oct. 16, 2007]

2:21 am on Oct 16, 2007 (gmt 0)

WebmasterWorld Senior Member jane_doe is a WebmasterWorld Top Contributor of All Time 10+ Year Member



Whwre are you guys getting your traffic estimates for their site from? Those traffic figures seem incredibly low for the number of articles they have and the sales price.

I have traffic approaching that numer of uniques ballpark and I'm willing to sell all of my sites for only $249 million. I'll even throw in my myspace page as a bonus. :)

2:53 am on Oct 16, 2007 (gmt 0)



I think the $250 million offer indicates that content and audience are worth more than just traffic alone. The earlier mention of advertisers like Sears, Sony, etc. probably says something about the income and buying habits of the HowStuffWorks audience, which you can read about on this page [howstuffworks.com] of the HSW Media Kit.
 

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