PayPerPost In The News Again
PayPerPost, the controversial startup that pays bloggers to write about advertisers' products, will be in the news again tomorrow. They will be announcing the acquisition of blogging tools and services company Performancing (see our earlier coverage of Performancing).
Context & Ripple Effects
PayPerPost has spent 2006 as the most polarizing company in blog advertising: the startup pays bloggers directly to write about advertisers' products, a model Robert Scoble publicly rejected six months ago unless writers disclose the arrangement (his stated conditions for ever using it). The controversy is not incidental — disclosure, or the lack of it, is the core criticism of the business.
The acquisition target brings an awkward pairing of assets. Performancing built blogging tools and services, and as far back as December 2005 its people were talking with John Battelle about how independent publishing networks like FM Publishing could work (that conversation about publisher economics). Folding those tools into a paid-posting marketplace puts PayPerPost closer to the bloggers themselves — their workflow, not just their posts.
First-order effects
- Bloggers using Performancing's tools now sit inside a company whose revenue depends on sponsored posts, so every future product decision trades off tool credibility against marketplace growth.
- PayPerPost gains distribution and legitimacy signals from owning established blogging software rather than only the controversial posting service.
Second-order effects
- Rivals in blog monetization — ad networks and sponsored-content marketplaces — are pushed toward tool acquisitions of their own or clearer disclosure policies to distinguish themselves from PayPerPost's reputation.
- The disclosure fight sharpens: critics like Scobleizer now argue against a company that owns infrastructure bloggers rely on, raising the stakes of the disclosure-versus-undeclared-advertising question across the medium.
Third-order effects
- If pay-for-posts spreads through owned tools and platforms, the line between editorial and advertising in blogs erodes structurally, making formal disclosure rules — voluntary codes or regulator intervention — more likely than platform-by-platform discretion.
- Blogging shifts from a reader-funded or ad-network-funded medium toward direct advertiser-to-writer payment, with whoever controls the tools controlling the terms of that payment.
The trend: Blog monetization is moving from indirect ad networks toward direct advertiser-to-blogger payments, with disclosure norms lagging behind the deals that force the question.