December 23, 2013

In an interview with CNN media reporter Brian Stelter, Politico CEO Jim VandeHei described the challenge facing his organization as it seeks to colonize another city via its fall acquisition of Capital New York: “I think there’s tons of opportunity, and to me, it’s fun to try to figure out how do you connect awesome journalism with an awesome business model. The awesome journalism part is very executable.(1) The business part is tough stuff. There aren’t that many people who are getting it right. A lot of people who people say are getting it right probably aren’t if you looked at their books (2),” VandeHei said.

Footnotes:

(1) Correct: Seven years ago, Beltwayers were scornful of the notion that a new publication could come in and offer something new. There were already so many competitors in the field! Well, as it turns out, there were already so many complacent competitors in the field. No question that Politico/Capital New York will expose a bit of that same dynamic in the Big Apple.

(2) There’s a touch of irony in this statement, considering this passage in a recent Bloomberg Businessweek story:

How much it’s making is something of a mystery. Allbritton Communications is a private company and does not disclose financial information. “Politico is doing well,” says Allbritton. “Everybody is like, ‘Well, are you making money?’ I guess the answer is, if I want to, yes. I don’t need the cash flow out of it, so we continue to plow the money back into the business.”

Also in that Bloomberg story: For the first half of 2013, just $3 million was spent on lobbying-related advertising in New York state. Politico is used to a much bigger kitty in Washington, one that may stretch as high as $200 million — which is why Capital New York is going after paying subscribers. It’s going to get cutthroat in New York.

Stelter’s CNN interview didn’t alight on an issue recently highlighted in this blog — the tendency of Mike Allen’s “Playbook” to say nice things about advertisers. That’s an important consideration for Capital New York because the Rosslyners are transplanting the “Playbook” model up there. One tweep asked Stelter about the omission:

 

And Stelter replied:

 

 

Credit Stelter for responding to his detractors; ding him for a not-terribly-convincing rationale.

Erik Wemple writes the Erik Wemple blog, where he reports and opines on media organizations of all sorts.