Team 46: Platform Mediated Networks – Slant News vs. Blendle
In the publishing industry, traditional publishing companies suffer significant decreases in revenues, while new business models arise as a result of technological innovation. Two of such innovative business models, Slant News and Blendle, introduced information technology as a source of competitive advantage, providing aggregated journalism that respectively competes and sustains the existing publishing companies.
This year, Slant News introduced a refreshing, innovative way to provide news articles from new sources and a dispersed variety of perspectives, combining crowdsourcing journalism with professional feedback (Slant, 2015). Blendle – founded in 2012 – is its ‘better-known’ and more matured counterpart that aggregates articles of a wide variety of magazines and newspapers, redistributing existing journalism on a pay-per-article basis (Blendle, 2015)
Both companies developed a platform-mediated network to connect multiple sides of the market that exchange value; Whereas Slant connects readers with amateur writers to achieve ‘cross-sided’ network effects incrementally, Blendle depends on existing publishers (including exceptionally big users, also referred to as ‘marquee users’) with large supplies to achieve large network effects to create value for its ‘money side’, the readers. (Eisenmann et al., 2006) As result of this difference regarding the ‘supply side’ of the platform, the bargaining power of the suppliers requires different approaches. Whereas Slant communicates with its content creators by digital (non-personal) channels with editing as key activity that connects them, Blendle is convinced that their (complex) message is best transmitted via direct communication, mainly through personally visiting the publishers to avoid miscommunication and build strong relationships.
On the other side of the platform-mediated network, the buyer side, another key difference can be found. The revenue model of Blendle is based on a pay-per-article base, in which the price of the individual articles – ranging from 10 to 89 euro cents, dependent on the publisher and length of the article – automatically gets deducted from the user’s account balance once the article is opened. Slant actually subsidizes readers as well as the writers of the articles in order to attract advertisers to gain revenues on a pay-per-click base. Important in this difference in revenue model is that Slant competes with the existing publishing companies, while Blendle provides an innovative business model that sustains the traditional publishing companies that suffer decreases in revenues.
Based on the findings, the authors predict that the concept of information technology to aggregate journalism in the publishing industry will grow in the future and will likely continue to put pressure on the existing publishing businesses. Especially the advantages of increased informedness and improved distribution lead to the scalability of customization (Clemons, 2008). Demands will be easier to match for both price- as well as quality sensitive consumers due to first and second order effects. The business model of Blendle is expected to be more successful than that of Slant News, as strong positive (cross-side) network effects in combination with the valuable and unique value proposition could result in a strong competitive advantage.
Geert Kriek (440801gk)
Koen Hut (416751kh)
Maxime van Egdom (409346me)
Siebe Kylstra (412656sk)
Stefan van Winden (421142sw)
Blendle Blog (2015) Blendle Blog: Archive [Online] Retrieved September 27, 2015, from: http://blog.blendle.nl
Clemons, E.K. 2008. How Information Changes Consumer Behavior and Consumer Behavior Determines Corporate Strategy. Journal of Management Information Systems 25(2) 13-40.
Eisenmann, Thomas R. and Parker, Geoffrey and Van Alstyne, Marshall W., Opening Platforms: How, When and Why? (August 31, 2008). Harvard Business School Entrepreneurial Management Working Paper No. 09-030.
Slant. (n.d.). What Is Slant? A Note From The Editors. Retrieved September 27, 2015, from https://www.slantnews.com/story/2015-06-23-what-is-slant-a-note-from-the-editors