Syndication With Aforethought: eSubstance Puts Licensing
In Its Sights

Though there were e-items all over the Frankfurt Book Fair, and a press release from the fair went so far as to assert that 75% of all companies exhibiting had some e-thing on display, there was not a lot to get excited about — except, that is, the Anglo-American newcomer, eSubstance.

In a sleek booth nestled into — where else? — aisle “E,” eSubstance continued to make the inroads it has been working on since CEO Jeffrey O’Rourke (ex-iCollector and WQED), MD Adrian Sington (cofounder of Boxtree), and CTO Hishaam Mufti-Bey (VP Technology for Morgan Stanley Dean Witter in London) set up shop earlier this year. The company is attempting to distinguish itself from competitors by focusing on a range of both licensors and licensees, and by automating as much of the process as it can, including the matching of content provider to potential licensee. The former could be offering books and magazines and eventually video or music, and the latter could be a corporate client, an online catalog, etailer, consumer site, etc. Few licensors are officially on board as yet, but they include Country Life magazine and Carlton Books. Licensees include Mothercare and Tesco. eSubstance tracks and controls rights and alerts both rights holder and licensee when the term is expiring.

Revenues to eSubstance come from a percentage of the price of the licensed content; advertising (though not, Sington is quick to point out, in the content), and further syndication of the content. eSubstance recently announced it had commissioned a series of articles from Earl Spenser about the family’s ancestral homes, which it is syndicating both on- and offline.

The company is using state of the art equipment provided by Vignette, which is also an investor, along with 3i and Vesta Capital Partners. Several book publishers have expressed interest in investing, according to Sington.

eSubstance’s flexibility could give them an edge over longtime syndication leader Screaming Media, which feeds content to websites and wireless devices, as well as services like iSyndicate and Themestream. The latter boasts more than 200,000 articles on its site (contributors used to reap a full 10 cents per page view, but that has since been slashed to 2 cents), and has tried to drum up business with its publisher program, through which users receive free email newsletters with publisher-branded content pertaining to their interests. iSyndicate has meanwhile extracted content from “1,192 leading brands,” and earlier this fall launched a 50/50 European joint venture with Bertelsmann — part of a strategy to funnel Bertelsmann content throughout the digital stratosphere. The company also has plans to hook into the Latin American Internet market, which is predicted to double by the year 2003 to $8.4 billion in B2B web spending. Then again, eSubstance’s full-service offerings could potentially grab business from more established DRM systems such as Yankee Book Peddlar spin-off Copyright Direct, which has staked its claim on the notion of increasing revenues through copyright compliance. Such has also been part of the plan for digital upstart PublishOne, a secure content distribution platform which hopes to “slice and dice” publisher content to targeted markets. At this stage, eSubstance seems to make protecting copyright part of the larger syndication package.