About.com and the Slow Decline of Content Farms

About.com LogoAccording to a recent article in All Things D, The New York Times is set to sell off About.com, one of its largest and best-known Internet properties, for a steep loss.

The sale, if it goes through, would have the site sold to Answers.com for $270 million. This is after the paper bought the site in 2005 for $410 million, making it a $140 million loss (approximately a 34% decline in value).

The move comes after About.com has had several disappointing quarters and has already replaced its CEO last year.

Why is About.com struggling? Though there are likely many factors, one of the key ones being discussed is that Google, through updates like its Panda update last year, have sought to de-prioritize content farm sites, like About.com, in favor of site it feels are higher quality.

These shifts were likely to hit About.com first because, as the Wall Street Journal reported back in 2011, About.com was one of the smallest of the content farm sites, long since passed by companies like Demand Media in audience size.

But what does this mean for content farms in general? The answer is unclear but it definitely seems content farms are struggling and as if the format and business model behind them is starting to lose a lot of luster.

The Content Farm Economy

New York Times LogoIt’s an amazing thought to realize that Google is powerful enough to sustain entire economies, in particular with companies and individuals not directly involved with it, but that’s exactly what the content farm economy is: An economy of Google.

Basically, content farms work by putting out as much content as possible on high-searched-for terms in hopes that Google will drive large amounts of traffic to them. Spammers do this by either scraping or generating content to fool the search engines but content farms do it by paying an army of authors to do it by hand.

The pay is typically very low and rewards quantity over quality. But, historically at least, it has been effective. It generates a great deal of original content that, historically, the search engines have loved. This, in turn, encouraged inbound linking which gave the domains more strength and helped their content rise across the top on a large number of queries.

Google, however, felt that these sites were hurting the overall quality of its search results and launched a series of algorithm changes designed, at least in part, to degrade their presence. The impact was pretty clear.

Yahoo closed its Associated Content brand, which it had just bought in 2010 and rolled it into other services. Demand Media went from being a profitable company to losing money, including over $6 million in the last quarter of 2011 alone.

Though Demand Media has rebounded some, earning a $94,000 during the first quarter this year, that came after sharply curtailing assignments and diversifying its content.

All in all, the traditional content farm business is not doing well. Google’s made it clear that these sites are not wanted and it is going to make things difficult for those who don’t change their ways.

So Are Content Farms Dying?

Personally, I’m loathe to say that an abstract concept like content farms are dead or dying. Usually those are just sensationalist headlines as such concepts can’t truly die, they almost always remain around in some capacity.

But it is obvious that 2011 was a bad year for content farm sites and that, despite some rebound, things are nowehere near where they were in 2010 and further back.

The potential sale of About.com highlights this reality.

If content farms were a growth industry or simple changes to the formula could bring back such sites to their former glory, it’s only logical that The New York Times, itself a company struggling to find good financial footing in the digital age, would be investing in the site, not selling it off at a loss.

The problem is simple, even if these sites can rebound from Google’s current round of devaluations, Google has made it clear that this is an ongoing war and there is, most likely, going to be another landscape shift on the horizon. These sites have hitched their business solely to Google and Google is not going to make that easy.

Furthermore, with the overall struggles of the economy and the rise in user-generated content sites, such as wikis, social networking, forums, etc. there’s a lot of competition from different content-creation approaches.

Content farms, by their very nature, are sandwiched between sites that are even more efficient at generating content, such as social networking sites, and sites that produce targeted high-quality writing. Increasingly, they’re being squeezed out.

This isn’t to say that content farms will “die” but that they are likely going to find themselves fighting harder and harder to maintain a constantly shrinking niche.

Bottom Line

For content farms to survive, they need to follow Demand Media’s example and adapt. This means diversifying their content away from the keyword targeted and quickly-written content and into other fields.

This includes other media, most particularly video, but also creating content such as detailed guides and articles that are aimed at humans more than search engines.

About.com attempted to do much of this last year, but apparently with limited success. Still, it’s the only real shot these sites have because, when Google decides they don’t want you and your business depends on them, you have to either change or be prepared to suffer.

Google owns the index and they will do whatever they want with it, including destroying your business.

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