Politico has grown rapidly from a little-known start-up company to one of the nation’s most popular online sources of political news. But it has been riding a wave of interest in a hot presidential campaign, so what happens to Politico after Nov. 4?
It will expand. Politico (politico.com) is to announce on Monday that after Election Day, it will add reporters, editors, Web engineers and other employees; expand circulation of its newspaper edition in Washington; and print more often.
In the last few weeks, Politico has also quietly begun an experiment in sharing content and ad sales with newspapers.
After the election, “I anticipate some dip in our audience, but for our business model, it doesn’t really matter,” said Jim VandeHei, executive editor and co-founder of Politico. “We anticipate a nice surge on the revenue side.”
Politico draws a vast readership outside the Beltway, but its finances depend almost entirely on a small audience within a mile of the Capitol. The bulk of its revenue, in print and online, comes from ads placed by interest groups hoping to influence official Washington. That business slows in election years and picks up when a new administration and new Congress take office.
Started 20 months ago, Politico assembled a team of reporters and editors who had worked at The Washington Post, The Wall Street Journal, Time magazine and The New York Times, among other publications. It focused on campaigns, Congress and lobbying, and quickly became essential reading in Washington.
After the election, it is to create a dedicated White House reporting team, headed by Mike Allen, its senior political reporter. “No matter who wins the election, it’s going to be a captivating story as they govern,” Mr. VandeHei said.
Politico’s corps of reporters and editors will grow to more than 50 from 39, and the overall staff to 105 or more, from 85.
Circulation of the printed Politico, distributed free to nearly every office on Capitol Hill, is to grow to 32,000, from about 26,000, allowing it to approach that same kind of saturation at the White House and some executive branch agencies. Now printed Tuesday through Thursday when Congress is in session, it will add a Monday issue; when Congress is not in session, it will remain a once-a-week publication.
Small as it is, that newspaper still accounts for most of Politico’s revenue, though its Web site is closing in. The site draws well over three million unique visitors each month, more than all but a dozen American newspapers.
Politico, financed by the privately owned company Allbritton Communications, does not release financial figures, but executives say that it has operated around the break-even point lately and that they expect it to be profitable next year, well ahead of the original schedule.
Looking for a new revenue source, it recently created Politico Network, working with a handful of newspapers, including The Atlanta Journal-Constitution and The Plain Dealer in Cleveland. Politico provides some articles to the papers, which turn over some of their online advertising space to Politico to sell.
Newspapers have not been able to sell enough ads to fill all their Web pages. Unsold space is usually turned over to giant ad networks like Google’s or Yahoo’s, which sell it at cut rates. For these “remainder” ads, newspapers collect a tiny fraction of the amount they receive for ads they are able to sell directly.
Political pages can be an especially tough sell for papers, whose consumer advertisers dislike controversy. But Politico hopes to aggregate political pages from multiple newspapers, sell them to advertisers, and return to the papers significantly more than they would receive from standard ad networks.