Interview: Andrew Paulson, CEO, Sup: Russia's Web Revolution, Making LiveJournal Pay
This story was written by Robert Andrews.
LiveJournal's new owner plans to introduce more commercial features this year as the Russian internet scene begins to explode. Andrew Paulson, CEO of upstart Moscow media investment vehicle Sup, said SixApart, from which it bought the community in December, had "not paid very much attention to monetizing" it though LJ was Russia's fourth biggest website, SixApart "had done nothing to get it there and wasn't doing anything to maintain its position". Paulson now claims to have more than doubled Russian LJ traffic since the acquisition and - despite recent user outcry that forced a reversal of a decision to axe the free basic offering, leaving only premium subscriptions - is planning more "payment relationships with our clients". "If you've got a company that has two revenue streams, keep 'em," he said, expecting to roll out new pay-for features in the next few months.
-- Russia's explosion: With mega IPOs planned for Yandex and Mail.ru and the online population forecast to become Europe's second biggest on 40 million this year, Russia is suddenly where it's at - also evidenced by Google's (NSDQ: GOOG) purchase last week of Rambler's Begun ad unit. Paulson credits the revolution to broadband suppliers cutting prices - "It's 'play now or forever be marginalized'" - but economically, too, there are advantages: "The country's doing very well and even better when compared to the doldrums of the US and western Europe. Media buyers in Russia are more imaginative and more demanding of innovative advertising tools than elsewhere in the world, the shift from old media to new media is happening faster than it happened in the west."All the other BRIC countries have strong presence from Yahoo (NSDQ: YHOO), Google and Microsoft (NSDQ: MSFT), but neither of these companies has made much of a dent here." Still, Sup maintains a San Francisco office, used as an international gateway to Silicon Valley skills.
-- Advertising: A recent eMarketer study forecast Russian online ads would almost double to $685 million this year. LiveJournal's new VP Matt Berardo, recently hired from Yahoo, told me Russia's web ads sector is "probably a bit behind" and "still primarily banners and some contextual advertising" but that's "in fast-forward". Paulson claims "surprisingly high" CPMs of $20 to $30 from +SOL, Sup's ad sales unit - which sells banners in to Russia for clients like Forbes, Yahoo and Times Online - and is "not worried" about an advertising recession spreading.
Read more about Sup's Gazeta.ru acquisition, LiveJournal's plans for India and the burgeoning Russian dot.com scene in the full interview with Andrew Paulson on paidContent:UK...
By Robert Andrews