Response to First Case Study: Politico Parts A&B

Robert Allbritton was right in his argument that Politico, as an online venture, did not have as much potential for profit without a paper product. Evidently, without an investor like Allbritton who was willing to continue even after a net operating loss of about $5 million in less than 18 months, John Harris and Jim Vandehei would have regretted their decision to quit their high-profile jobs at The Washington Post. I also think it was a bold, though worthy,  risk for them to have initially intended to delve optimistically into an exclusively online venture on the eve of presidential elections when others like Politcs.com and Allpolitics.com had started and failed to last beyond presidential campaigns.

However, Harris and Vandehei deserve credit for tactfully assembling a high-profile team that gave Politico a remarkably high startup audience and a monthly average of 3 million unique visitors within months of startup. Unfortunately, the website with a much larger readership accounted for only 40% of Politico’s ad revenue as opposed to the newspaper which brought in 60%. One is tempted to think that an Allbritton-type investor would be indispensable to the success of one’s media business.