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Starwave Takes the Web ... (Seriously)

By: Michael S. MaloneTue Dec 18, 2007 at 5:40 PM
CEO Mike Slade has assembled a team of the best and brightest to create the Web's first real company. All they have to do is meet five tough challenges.

What Phillips has been trying to create with his eclectic team is the workplace equivalent of a thriving new community. In addition to hiring talent, he explains, he's been looking to avoid "prospectors" and bring in "homesteaders." Prospectors are strictly focused on the short term. Their goal is to make the quick strike -- if it doesn't happen fast, they tend to grow bored and move on. Homesteaders, on the other hand, are people who leave their successful careers, looking for that one big adventure in which they can stake out their claim, regain control over their lives, and settle down in a safe place for their families. It's only partly in jest that Phillips's wife, an aspiring novelist, calls herself a "pioneer wife."

As homey as all this sounds, and as clever as Phillips's categories are, the problem Starwave faces is the same that confronts most start-from-scratch communities: Is it a new town they all share, or just a random collection of neighborhoods? The answer may determine whether Starwave becomes the first big Web company, or instead remains a series of loosely linked Web projects. At the moment, the company's various editorial departments are very much next-door neighbors but operate in separate realities: these homesteaders are a far cry from collaborating to build one town they can all inhabit.

"It's important to have diversity in our services, but at the same time tying them all together is problematic," Phillips acknowledges. "Especially when they're all competing for engineering and advertising resources. When it comes to building a corporate culture, sharing learning, that sort of thing, we're not there yet."

Challenge Number Four

How do you produce as much original material as possible -- and leverage relationships with brand-name partners for the rest?

"I think you can accurately describe this as bedlam," says Susan Mulcahy, editor-in-chief and publisher of Mr. Showbiz, as she walks through its offices and gestures at the posters and Hollywood detritus.

In cultural terms, no one has come as far to Starwave as Mulcahy. Witness a short inventory of items in her office : a copy of a 1952 New Yorker cover, a postcard of the St. Regis Hotel bar, a Henry Alford column about walking around Manhattan in pajamas, a metal desk-spike from the New York Post city room, Norma Shearer and Rudolph Valentino paper dolls, a cheesy Mexican comic book (Páginas Intimas), and a 1950s plastic doll from New Jersey.

This office, combined with her languid-yet-nervous style emblematic of a proto-New York City magazine editor, makes Mulcahy seem like a rare orchid lost in the Olympic rainforest. In fact, however, Mulcahy's journey to Starwave was shorter -- in miles -- than almost any other recruit's.

When she agreed to develop an online entertainment service for Starwave in 1994, Mulcahy was burned out from the New York scene and living in a trailer in Joseph, a small town in eastern Oregon. "I was tired of the downsizing, the chronic kvetching, and the overwhelming sense of going nowhere," she says. So she had lit out for Oregon and a self-created life, struggling to make a living writing articles and screenplays.

When Phillips first contacted her, Mulcahy had never so much as gone online. So she bought a 2400-baud modem and signed up with America Online. "A few days later," she recalls, "I called him up and said, 'Why is anybody interested in this? It takes an hour to get a page.'" But Phillips was insistent, and six months later, Mulcahy moved north -- "partly because I wanted to eat again," she laughs.

The service she created and now directs, Mr. Showbiz, offers perhaps the best view into the challenges facing Starwave both externally, as it tries to build a business on the Web, and internally, as it struggles to coordinate its various operations. Mr. Showbiz has more than 20,000 users per day, generating about 600,000 visits and 12 million hits per month. Those numbers make Mr. Showbiz a hit by Web standards -- but they're just a fraction of the traffic at the mighty SportsZone. As a result, Mr. Showbiz commands ad rates of only $4,500 per month, about a third of the rates charged by its neighbor down the hall.

Moreover, unlike SportsZone or Outside Online, Mr. Showbiz has yet to find a strategic partner -- which puts a lot of pressure on the staff to generate original material and to create a powerful enough Web presence on its own to become a brand. Add to that the ongoing education of a print journalist to the technological and editorial demands of the Web, and you begin to appreciate the pressure on Mulcahy and her group to make Mr. Showbiz come to life.

From Issue 05 | October 1996

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