"90% of traffic to Gawker sites is to the homepage or RSS feeds where you guys get nothing.

so, you can basically take the $7.50 rate and assume 10-20% of that is your actual cut of the posts value."

so with 80-90% of the traffic not going to the employees just landing on the homepage, where adds are still served and revenue goes straight to the bottom line, then how would he be losing 2-3k a month? That sounds like a really profitable business model to me. But I never went to inonates and owens school for valuing companies so maybe im an Idiot.

Heh heh. "When he sells the brand out from under you guys." Thank god someone already sold AOL a blog network.

@OnYourEnemiesList: How could you get $7.50 CPMs on a Gawker property? Not to mention the fact that I nearly never see ads on a ValleyWag post (you'd want your brand associated with this?).

The issue is that all those homepage and RSS views don't actually make up for the difference between the CPM Denton pays and the CPM Denton receives.

I think this is going to get a lot of page views. Given that it was someone else's e-mail that made it interesting.... Are you at least going to buy the guy a latte?

@innonate: I guess thats fair, as a matter of habit I dont even notice ad's but now that you mention it all the ad's are cross promo ad's for other gawker sites. As for brand association I would advertise my brand here if it was unrelated for example BMW or financial services etc, as I would assume the readership tended to be well heeled.

I'd like to see what Jordan "Destroyer of Brands" Golson could do with Netscape... oh, nevermind.

@OnYourEnemiesList: Jason's tendency is to make at least three contradictory dubious statements at once. For example:

1. Denton is scamming tons of money off his writers.
2. Gawker's writers are the best paid in the industry.
3. Denton is losing money on Valleywag.
4. One of Valleywag's writers is making tons of money off Denton.
5. The current pay scheme "cuts the business to its core;" I think this means Jason thinks it's still the most sensible extension of how the business works, so writers are rewarded when Gawker Media is rewarded.

Since several of these are mutually exclusive, either Jason is hedging his bets and hoping no one notices (in which case I'm not sure why he's talking at all) or he's finally realized he's wasting his time by writing to us, so he had CK Sample write this on Jason's iPhone.

Denton is causing me lost time with this god damn site. Not only is he not making money, he is a drag on the economy as a whole.

What did JCal pay his writers back then? $4/entry. Who was making lots of oney of the back of his writers?

Even with $6.50 + base pay, and the traffic to the homepage (and older entries, written by not active bloggers), VW seems to be close to make even. Very special correspondent's pay not included obviously. Also, one can easily assume that in an imperium like Gawker not every site needs to break even, because Gizmodo and Jalopnik will easily turn higher rates.

And yes, VW probably is a fun site for Denton.

Jason, continue stirring the controversy it's what you're best at. Obviously, and Mahalo shows this once more, content isn't your best area.

@MarkTheMarketWatcher: No, this post will stiff at around 1,000 reads. 1,500 max. Bet you a latte.

Wag readers seem to vanish Friday afternoon for some reason. I wonder where they all go?

It has as many contradictions as Julia Allison press release..

@franky: I think VW is Denton's way of keeping an eye on the industry that's keeping an eye on him. Also, getting in front of VCs without taking a number and sitting in the waiting room looking perky and desperate.

@shareme: Jason & Julia?

They'd be so busy trying to talk over each other that we'd be spared from hearing from either of them...

Brands Will Be De Story will be the title of my blockbuster business book. Emo bad-boy band Denton Sick Margins will play at my massive book party. It will be the last party in human history, as the interstellar hordes of the Gawker Imperium pick exactly that moment to cut the human race down to it's core and sell the planet out from under us.

@Paul Boutin: I hear Ritual's a good place to buy someone a latte these days.

7.50 is including a percentage of the home page sales. I bet average CPM for any particular post will be below the 7.50 mark.