Glam media

Glam Media Blames Economy, Slows Down Payments To Publishers

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Glam Media, the always interesting womens network (and now men’s network) is back in the news this morning.

Glam is both a direct publisher of content and an advertising network. A big part of their business model is float management – making sure that they collect money before they pay it out to partners. If they pay too soon, they could get hit with bad debt when advertisers don’t pay. Pay later, and they keep the interest they earn on partner money.

That’s why they’re extending the payment period to already beleaguered publishing partners. In a notice today, Glam blames the economy and extends payment terms from 60 or 90 to 120 days:

Dear Publisher,

Please be advised that to better prepare for the current financial situation, Glam anticipates a significant slow down in collection payments from advertisers. Therefore we will need to align the expected timing of payments from advertisers with the payments we make to our publishers. Accordingly, as of November 1, 2008 the revenue payments will now be scheduled on 120 day payment terms. However, in order to help minimize the impact to you and avoid gaps in payments, you will be paid as follows:

For publishers with 60 day payment terms:

Dear Publisher,

Please be advised that to better prepare for the current financial situation, Glam anticipates a significant slow down in collection payments from advertisers. Therefore we will need to align the expected timing of payments from advertisers with the payments we make to our publishers. Accordingly, as of November 1, 2008 the revenue payments will now be scheduled on 120 day payment terms. However, in order to help minimize the impact to you and avoid gaps in payments, you will be paid as follows:

November Revenue: 50% will be paid in January and 50% will be paid in February
December Revenue: 50% will be paid in March and 50% will be paid in April
January Revenue: 100% will be paid in May
Note: There are no changes in the amount you will earn or receive with this payment revision.

We appreciate your cooperation and we will do everything we can to make the transition to the new payment schedule as smooth as possible.

This agreement will go into effect November 1, 2008.

For publishers with 90 day payment terms:

Dear Publisher,

Please be advised that to better prepare for the current financial situation, Glam anticipates a significant slow down in collection payments from advertisers. Therefore we will need to align the expected timing of payments from advertisers with the payments we make to our publishers. Accordingly, as of November 1, 2008 the revenue payments will now be scheduled on 120 day payment terms. However, in order to help minimize the impact to you and avoid gaps in payments, you will be paid as follows:
November Revenue: 50% will be paid in February and 50% will be paid in March
December Revenue: 100 will be paid in April
January Revenue: 100% will be paid in May
Note: There are no changes in the amount you will earn or receive with this payment revision.

We appreciate your cooperation and we will do everything we can to make the transition to the new payment schedule as smooth as possible.

This agreement will go into effect November 1, 2008.

Long payment terms are just business as usual with ad networks – it often takes our partner Federated Media six months or more to get us payment for ads served on TechCrunch. This is more of a sign of Glam’s ongoing transition from making guaranteed payments to publishing partners to a more stable and traditonal revenue share model. But for partners, it’s the equivalent of skipping 2-4 months of revenue as they wait out the new payment period. For some it will mean laying off writers and cutting other costs as the effects trickle down.

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