Peter Kafka

Recent Posts by Peter Kafka

Sold! Hollywood Blog Queen Nikki Finke Goes to…


The Nikki Finke auction is over, and the winner is… Jay Penske’s Media Corporation, which owns the email service and a small portfolio of Web sites, has acquired the blogger, whose Deadline Hollywood Daily is a must-read for Hollywood.

No details on pricing yet.* But, the fate of Finke’s site, which was managed by the LA Weekly, has been the subject of lots of speculation in recent months, including spirited back-and-forths between Finke and competitors like Variety and Sharon Waxman’s The Wrap.

Reading that stuff has been nearly as entertaining as Finke’s column. She provides blow-by-blow Tinseltown coverage–she seemed to post nearly hourly during the 2007-2008 writer’s strike–and relishes her scoops. One of her most recent: Allegations that GE’s (GE) NBC Universal was trying to “stifle” the Hollywood Reporter’s coverage of the entertainment conglomerate and its parent company.

Finke says she’ll keep full editorial and design control as she begins working for Penske, the son of auto magnate Roger Penske. He’s making an interesting move: is a white-label email provider that raised $35 million last year, but he’s been expanding into the content business. Earlier this year, he relaunched Movieline with staff from Gawker Media’s Defamer site.

But Finke’s site will remain separate from the rest of Penske’s portfolio. She says she’ll expand her one-woman show by hiring a “senior” journalist based in New York City within the next three months.

That will be a tricky expansion to navigate: Recent history shows that blogs produced by dedicated/obsessive proprietors often stumble when they expand, in part because dedicated/obsessive proprietors may not be the best managers and in part because it’s tough to find people who want, or are able, to work for dedicated/obsessive proprietors.

And from my perch, this seems like a lousy time to sell an ad-supported news site. Not so, says Finke. Or at least, not her site.

“I was not anxious to sell. I was not looking to sell,” she says. “This was sort of a process where various people kind of wore me down….I’m very pleased with what happened. What wound up happening was nothing like the offers I was getting a year ago.”

UPDATE: You can now pick a number, depending on which news source you like, but they range from “low seven figures” to $15 million. It would be awesome if any of them are true–I need a bigger apartment, among other things, and it’d be great to know that you can get rich blogging–but the only one I think is remotely plausible is the lowest one, from Rafat Ali at PaidContent.

Gabe Snyder at Gawker does a nice job of running through the estimates and explaining why they don’t make sense.

The only thing I’d add is that all of the numbers being floated today are almost certain to include earnout clauses, meaning the deal is potentially worth up to X amount–if Finke’s site hits certain performance goals. Which is a lot different than saying she’s actually made X amount in the deal.

Another way of putting it, from a source who buys and sells media assets for a living: “Presumably it’s one of these billion dollar earnout deals. I’ll pay you a billion dollars–one dollar (more or less) upfront, and the rest as a percentage of revenues (or profits if I ever find someone else to sell this to). But in the meantime you can tell your friends that you were paid a billion.”

UPDATE2: Now the WSJ estimates the deal at $10 million — but says that number includes equity from, along with a $1 million upfront payment.