Remember those ‘Simpsons’ beatniks (I believe it was Ned Flanders’ parents) who said, “You gotta help us, Doc. We’ve tried nothin’ and we’re all out of ideas?” I always think that’s a very true statement in Internet business for 2 reasons: you have to try things and you cannot run out of ideas. If you do, you might as well shut down your servers and walk away.
In yesterday’s issue of the Financial Post there was an article titled “Acclaim is not bankable” (later re-titled “The challenge of success: CoverItLive ponders its next step”) about our direct competitors in the liveblogging software space, CoverItLive. The premise of the article was, despite CoverItLive’s claims of being widely successful, it is simply impossible for them to get paying customers. In the past, CoverItLive’s founder has even blamed the fundamentals of how the web works: “It’s too challenging to come out with a completely new way of doing things and expect people to adapt it quickly and pay for it” (source).
I started my career as a web-developer. The first thing I learned when writing code was that bugs are unavoidable. They happen every day. You have two options when your program unexpectedly crashes: blame the computer it’s running on, or blame your code. Computer systems aren’t flawless (ask Windows ME), but if you’ve just added a new branch of code, and when you run it for the first time your program crashes, it’s pretty obvious that the code is the problem.
CoverItLive, I believe, may have made the same mistake every first-year programming student makes and blamed their machine: the economic system their business is trying to run on. Either they have invented a piece of software that is fundamentally unmonetizable, or they might be running out of ideas. On the web, running out of ideas is the point where often companies start blindly slapping ads on their products and hope to start making enough money to keep them going.
The irony is, CoverItLive only has to look a few blocks from their office in Toronto for an example of how to monetize the liveblogging space: ScribbleLive. Over the last year we have steadily grown our customer base of media companies paying fees to use our liveblogging platform. Many of them are ex- CoverItLive users that went from using their free widget, to paying for our platform.
Why would one of these media companies pay real money for a liveblogging service? The answer is simple: we create real value, and that value makes them money. ScribbleLive was built from the ground-up to be a seamless part of a company’s online strategy. We create real branded webpages that can be found by Google and increase page-tonnage (and SEO) on our customers’ URLs with our customers’ ads. By building our infrastructure in the Amazon Cloud, we’re able to provide our services at a fraction of the cost of CoverItLive, while scaling bigger and faster around large liveblogging events. By having real customers with real business requirements, we have a direct line to what those customers want which keeps our feature pipeline full and extremely targeted. In the past year we have produced over 3 times as many features as CoverItLive (with ScribbleLive even having a smaller staff), which will culminate this winter with the extension of our technology into a completely new space.
Over the next months, we will see diverging business models from our two companies, as we at ScribbleLive continue to develop our product and our company as a valuable partner to some of the world’s largest media companies. Through the next quarters, the market will shake out whose model is better. But at the end of the day, the proof is in the customers where we are a generation ahead of the fledgling business model of CoverItLive.
We have something we say at ScribbleLive all the time: every customer makes us better. The diversity in the marketplace constantly pushes us to evolve, and moulds us into an even better product. And if something doesn’t work, we’ll try something else. But at the end of the day, we will always blame our own code first.
Jonathan Keebler
CTO/Founder, ScribbleLive