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Comment by arbuge | Hacker News Reader

I find it hard to believe those media properties like Huffpo are losing money. I didn't read their financial statements but I wonder if it's just a financial artifact caused by deprecation/amortization. They bought Huffpo for $315m a few years ago for example... if they're amortizing that over several years, they could really be printing money but ending up with an accounting loss.

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I'd like to think my friends realized that HuffPo was a vile pit of tabloid trash (independent of their pandery political positioning) and content farming. I WANT TO BELIEVE. Don't take this away from me!

I don't find it hard to believe: If you had a massive revenue stream coming in from a product that you know is dying, you might be happy just to milk it and close up shop when it dries up, or you might decide to throw a large chunk of your earnings from that division into trying to grow your other businesses, at the expense of profitability, in the hope of being able to make solid profits from them when you scale back on the "growth at all cost" expenditure down the line. Whether or not they'll succeed at that is another matter.

Goodwill does not depreciate, thus your accounting explanation doesn't make sense. Huffpo cannot be that profitable because their ad inventory is total garbage. That site is probably worth less than $1 CPM. They probably make a mere million dollar per billion page views.

If they are getting $1 CPM it would be a miracle.

I guess they just have enormous expenses — tons of people on the payroll, nice offices, etc. — and don't pull in enough advertising revenue to break even.

Losing money isn't hard.

Just goes to show how hard it is to monetize on ads. Any startup that tries to monetize on ads is basically betting on becoming Google or Facebook level big.

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