One fact that magazine publishers have always dung to-sometimes desperately now as the dot-com economy changes everything they do-is that they can produce and sell content. In print, at least.

Now they've found a new revenue stream-selling content online, or content redistribution. And it's rapidly becoming a revenue source comparable to list rentals or some other significant ancillary activity.

The numbers indicate a rapid ramping up of magazine companies that use content distribution. One distributor, Screaming Media, says its roster of content contributors has grown from 100 a year ago to more than 1,000 now, with about 30 percent of the material coming from magazine companies. Content on a wide range of topics, including technology, science, entertainment and advertising, is filtered and redistributed through the site. Magazines that distribute content through Screaming Media include Red Herring, Business 2.0 and Cigar Aficionado.

"I think the majority of trade publishers are involved in some form of repurposing content, either for a direct or indirect revenue stream," says Cameron Bishop, CEO of Overland Park, Kansas-- based Intertec Publishing (which owns FOLIO:). And while the revenue impact isn't comparable to advertising or circulation, Bishop estimates that a $100 million company can expect 1 to 5 percent of revenues to come from repurposing content this year via a direct revenue stream. In 2001, he predicts, that percentage will be closer to 5 percent. "The really attractive thing about it is that the flowthrough to profits is enormous, approaching 100 percent," he says. "There's little or no additional expense to repurposing content."

How does it all work? Screaming Media, which has a network of about 900 Web sites to which it distributes content, pays content providers a fee. "They're paid around 30 percent of the gross revenue that we get," says Marianne Howatson, senior managing director, global content management for Screaming Media, based in New York. In addition to the percentage, content providers can also have one link per article.

Screaming Media's clients range from very large to small, and include such sites as About.com, NBC Olympics.com and Telemundo. Each wants content filtered to fit its particular site. For instance, a site like Realty.com will get articles on real estate. Howatson points to health, business and technology as big growth areas. More and more sites are requesting en-tertainment and lifestyle content, as well.

Clients sign up annually with Screaming Media and are charged about $6 for each story published. "They'll subscribe for a year and they'll subscribe for X number of stories per month," Howatson says. Depending on, the amount of content provided, an annual subscription could cost anywhere from $12,000 to $1 million.

Providers give approval to those sites where their content is being distributed. Additionally, the service has some 7,000 filters through which Screaming Media makes sure content is directed to the most relevant sites.

How much can a given magazine publisher expect to make under the Screaming Media model? While Howatson was unwilling to give even a hypothetical estimate of annual revenues, she said the biggest content providers, who are delivering hundreds of stories a day, can generate thousands of dollars per month.

Another start-up content distributor, MagazineContent.com, also hopes publishers will be willing to provide content for a chance to share profits. Founder and CEO Pierre Bisaillon says companies will pay an estimated $250 to $5,000 a month, depending on the amount of content they want. Profits will be split 50:50 with publishers. Bisaillon says rates for the service range from around $5 to $10 per month, or about $80 annually.

Shift in the business model

Content distribution marks a shift for publishers. Before, readers would come to the content; now the content is being directed out on the Internet to the appropriate readers. ESPN is an example, says Howatson. It reaches sports fans through television, the Internet and the print magazine. "The old way of publishing was to publish a sports magazine and readers would come to it and buy it," she says. "What you need to do now on the Internet, because there are so many people and so many choices, is send your content out to find those people."

Both consumer and trade publishers are following this example. Intertec's Bishop says his company has deals with 13 different content aggregators on the Web. "They have proved to be very beneficial for our business in a couple of ways," he says. "They have provided a nice additional revenue stream, which is pure profit, and they have enhanced our brands and broadened our exposure. We're creating new revenue streams with our Internet business, and we're leveraging up our print business because of the package solutions that we can offer."

Although he declines to say what the financial impact has been for Intertec, Bishop doesn't put content distribution in the same class as trade shows, core display advertising or subscription revenue.

The benefits of bartering

The rewards of pushing content beyond traditional outlets aren't always as obvious as a percentage of profits. Another way publishers are taking advantage of the Internet is through barter-type arrangements. Instead of a "cash-forcontent" deal, they provide content to Web sites in exchange for things like brand exposure and customer acquisition.

"It's basically a freeway where they can barter their content instead of buying advertising," says Bill Turpin, president and CEO of Themestream, a resource for personal-interest articles and products on the Web. The Sunnyvale, California-- based company, founded in August 1999, represents more than 1,700 personal-interest topics, grouped in 16 main categories. Users can access articles and information on the site based on their personal interests.

The company is aligning itself with a number of high-profile publishers and partners and has formed alliances with Simon & Schuster, Homestead, Golf Online and Boats.com, among others.

The Themestream business model is to make money by guiding consumers to e-commerce providers. Each time a consumer clicks on product offers on the site, Themestream gets paid. Additionally, the company profits through direct e-mail offers from publishers or retailers. "Every piece of content that a publisher shares with Themestream can be considered a free direct-mail piece to a very targeted audience that has told us that they are interested in the topic that the magazine writes about," says Trish Hayward, vice president of marketing.

Publishers can also use Themestream to direct consumers to storefronts on their own sites, opening up their own commerce opportunities. "We've got the traffic and we're willing to trade that for the content and the branding from the publisher. The publisher's only other choice is to buy targeted advertising on the Web, which is very expensive," says Turpin, who served as a vice president of Netscape Communications prior to founding Themestream.

One publisher currently using Themestream is Sunset Publishing, which is providing content from Sunset. "We are allowing them to publish our content on the Web, and it is fully attributed as being Sunset content. This, in turn, gives the consumer-who has preselected his or her interest in this particular type of vertical content-the opportunity to come back to Sunset's site to deepen his or her relationship with the magazine," says Steve Seabolt, president of Sunset Publishing.

While the arrangement doesn't provide a direct financial impact, Seabolt believes it will pay off in terms of exposure. "Themestream takes our brand and puts it right in front of the consumer," he says. "We do direct mail trying to find the people Themestream is delivering-people who have indicated a preference in subject areas that are our core expertise."

Seabolt foresees other opportunities for publishers to take advantage of the need for content on the Web. "Internet companies have a very interesting combination of traits: cash rich, time pressed, content starved, and a low level of consumer awareness and brand equity. Magazine publishers have the opportunity to fully maximize or play off all those traits," Seabolt says.

Strategically speaking

Another way that publishers have leveraged content is through strategic alliances. Earlier, Meredith Corporation announced two separate deals that focus on the Internet. One is a marketing alliance with Homeportfolio.com, an agreement that includes content sharing, e-commerce and advertising. A second deal partnered More-which doesn't have its own Web site-with ThirdAge.com, providing content on style and beauty for the ThirdAge site.

"There will be content from our magazines on the Homeportfolio site, and we will host various components of their site, especially their product finder, on our Web site," says Hal Oringer, vice president of sales and marketing for Meredith Interactive Media. "The idea is for both of us to get richer content for consumers by sharing."

And by sharing content with ThirdAge, Oringer says the company can get the magazine's content on the Web: "It's a good strategic partnership for both of us in terms of getting More's content in front of the right audience, and in a substantial way."

Both deals show how different types of media companies can work together for the benefit of both, he adds. "There may be dot-coms or other companies that have put a lot of money into building traffic on their Web sites and have created applications and services that work for our audience. So it makes much more sense to partner than to create all these things from scratch."

Maintaining control

Regardless of the type of deal, the biggest concern publishers have is that their content not be distributed so far and wide that it becomes diluted. Publishers want to get it out there, but they also want to have control over where it's going. "We insist on retaining control of our content," notes Oringer. "We're very interested in protecting our brands." For instance, he says, Meredith retains the right to review how the content is being used.