Related Story: ? JD's Web Watch: Online News Association Needs to Reach Out It was billed as a celebration, but there were a lot of somber moments at the inaugural Online Journalism Awards. Just as the Internet press corps was coming together to recognize its accomplishments, praise good work and push for high standards, folks were being laid off left and right. Given the recent dot com downturn, irony abounded at the Dec. 1 awards ceremony in New York: Emily Prager wore a nametag that said Oxygen.com, but the women's portal has been gasping for air and Prager -- who won an award for her column 'The Read' -- was recently let go from her contract, while 65 of her colleagues were laid off. One of the day's top honors went to a Web site that's been struggling for months: APBnews.com won for Creative Use of the Medium: Original. 'I wish investors liked our content as much as award judges,' APB's managing producer Karl Idsvoog said. Contest finalist TheStreet.com recently announced that it was laying off 20 percent of its staff and ending its joint newsroom with The New York Times. Janice Castro, the Online News Association's (ONA) secretary and a panelist at the meeting that coincided with the awards, is leaving her post at Britannica.com-which recently decided to stop producing original content and has instituted layoffs.

Pendulums and Profits

What was clear during ONA's daylong meeting is that the really big outfits in the online news game are finally getting stable enough to think about turning a profit. Plenty of other sites, including Salon (another award winner) are still struggling.

Sreenath Sreenivasan, awards administrator and an associate professor at the Columbia Graduate School of Journalism, noted that the industry has been through this before. In 1995, outfits like Time were hiring lots of reporters, including scores of Columbia students who 'could just spell HTML.'

Massive layoffs followed in 1996.

'People are applying old media metrics to new media,' Sreenivasan said. 'They were too excited. ... Now the pendulum is swinging the other way. These things go in waves.'

Speaking on an afternoon panel on surviving change in the news industry, AOL's news director Gary Kebbel said too many sites tried to get big first and figure out everything else later.

'There have been a lot of bad decisions covered up by euphoria,' he said.

About 175 journalists and academics attended the ONA meeting. Founded in 1999, the association has about 500 members. Organizers predicted that the quality of online journalism will continue to expand.

'It's clearly tough times right now, but good work remains good work,' said Rich Jaroslovsky, managing editor of WSJ.com and president of the ONA board.

Some people, like Robin Miller, editor-in-chief of the Open Source Developers Network (which owns the popular Slashdot) weren't as worried.

Miller said that while some outfits have faltered, plenty of small, niche news sites have been started in the last few months. 'Be careful about saying (the word) downturn,' he said. 'There's churn, not down churn.'

He cited two new sites as examples, NewsForge, a techie-management site for the open source community that started in August, and Smokedot.org, an aggregator of news on marijuana and other drug legalization.

Miller, who used to freelance for Time New Media, said the industry is moving towards a World Wide Web with more and more niche publications. 'There will be a news site on schnauzers,' he said. 'It's a logical development. It's like what's happened with (print) magazines. Advertisers will pay fantastic premiums to reach a targeted marketplace.'

Have A Very Wary Christmas

Merrill Brown, editor-in-chief of MSNBC -- which won an award for general excellence in online journalism -- said people who have been pushing for sites like his to turn a profit don't understand that new media need time to develop. Now that MSNBC has been around for several years, he said, it's time to begin asking when it will be profitable.

But Brown, who spoke on a panel about Drawing the Line Between Content and Advertising, said the pressure to make money is only going to get worse in the beginning of 2001.

'This Christmas is going to be disappointing for most of us,' he said. The economic downturn in the dot com world 'is more severe than most would've predicted.'

This 'extraordinarily fragile situation' means advertisers will be pushing harder than ever to get their ads -- which are getting increasingly sophisticated -- deeper and deeper into editorial content, and possibly even overwhelming it.

'Companies feel like they have a blank check when it comes to our editorial content,' he said. 'We have had to lay down on the tracks more than I'd like to say.'

C|net founding editor Jai Singh (who snagged the award for breaking news original to the Web) said that since banner ads aren't working, his site was going to feature 'some big, honking ads in the middle of the content' early next year. While this might shock some people, he said the company is working to distinguish ads from editorial copy.

'The drive for revenue is now a drive for profitability,' added Randy Kilgore, executive director of marketing and sales for WSJ.com.

Kudos and Criticism

Many people were clearly enthusiastic that ONA was stepping forward to recognize work on the Internet that perhaps goes under appreciated at the moment by Pulitzer judges and others. Attendees were pleased that ONA is working to uphold strong journalistic ethics online.

'There's been a drive for growth at any cost. There's a lack of organized resistance,' said Kilgore. 'This organization is an exception.'

Still, while some small sites such as Cleveland Live won awards, others criticized the contest for being dominated and controlled by big media.

After Kurt Andersen, co-founder of Inside.com and an award judge, gave his keynote address, there was only one question.

Miller, an early member of ONA, wanted to know why the fee to submit work to the contest was so high.

'It cost $100 to enter (each submission),' said Miller, adding that this may have kept small, independent sites from applying. 'Did you guys worry about that?'

'We had nothing to do with that,' Andersen said. 'They're not even paying for my cab fare.'

Sreenivasan and Jaroslovsky later defended the $100 fee, but said next year they would consider letting ONA members pay less to submit work. More than 600 entries were received.

(ONA members were asked to pay $99 to attend the meeting in New York; non-members $149. Judges did not have to pay to attend the meeting; finalists did.)

In comparison to the ONA submission fee, it costs $50 to submit work to the Pulitzers and $60 (for members) to apply for awards run by the Society of Professional Journalists.

But the Pulitzers got started with millions in the bank, and Seymour Topping, the Pulitzer administrator, said, 'It's not a good basis for comparison at all.'

Sreenivasan said ONA is trying to establish an endowment and would ultimately like to have some monetary prize attached to the awards. This year, winners got a certificate and a Lucite award. He said the prizes were organized in a very short time frame. In addition, the ONA awards were ambitious because, unlike most of the awards administered at Columbia, this one is not exclusively American. The $100 fee was needed for the administration of the contest, covering part of Sreenivasan and his assistant's salary, office supplies, a university overhead fee and more.

'There's some (money) left over. We're not giving out exactly how much. It's all part of building the endowment,' Sreenivasan said.

'Given what other awards charge [as] an entry fee, I don't think it's out of line. ... It costs money and it's got to pay for itself,' Jaroslovsky added.

Disclosure: Theta Pavis edits an online magazine called Technophilly.com that submitted work to the awards contest. She and Sreenivasan were classmates at the Columbia Graduate School of Journalism in 1993. Revised: December 11, 2000.