This Media Life

Yin Eats Yang

Rielly, on the other hand, became the bane of his venture-capital backers. "They said I was flaky and unreliable, which I am, but they knew that going in," Rielly sniffs. Rielly was saved at the precipice only because Leonsis and AOL continued to support him and because PlanetOut had enough cash in the bank to buy out the Sequoia group. That left Rielly, however, with only $400,000 on hand and a monthly burn rate of $225,000.

Rielly was tanking while Goff, at 30, with a natural Microsoft arrogance and aggressiveness, was quickly becoming one of Bill Gates's key advisers on media matters. Sidewalk, Goff's maiden Web effort, was the most ambitious launch to date in the history of the Internet.

Rielly, meanwhile, traded in his chief-executive title for a new role, which he dubbed "chief homosexual officer," and appointed Megan Smith, a 33-year-old engineer, to replace him as PlanetOut's CEO. There's a theory -- let's call it the Steve Case theory -- that says the most important thing a manager can do is opt out of management. Again, Goff and Rielly represent divergent poles -- Goff is a control freak; Rielly runs from responsibility, a condition Megan Smith describes as his "checking-in-and-out behavior."

Smith herself, on the other hand, is an almost fifties sort of manager (even down to the name Smith). With a little critical interpretation, you could see her at GM or P&G. She's a stalwart of old-fashioned company dedication -- selfless, serene, and preternaturally sunny and optimistic.

As Goff launched the massively funded Sidewalk, Smith cut PlanetOut's burn rate from $225,000 to $40,000, then to $20,000.

They were not, Sidewalk and PlanetOut, dissimilar ideas. On the basis of his experience with Out and the gay community, Goff talked expertly about the new Internet-media concept of community -- of how people with similar interests can be brought together in a commercially advantageous setting.

But Goff's Sidewalk began as a ghost town and remained a ghost town. A few hundred million dollars failed to create a community. As Sidewalk failed, Goff moved over to MSN and encountered a similar failure to connect. The Internet's much-vaunted viral effect became on Microsoft's watch something of an antibody problem.

In early 1997, Out closed its Website and made a deal to funnel its remaining traffic to PlanetOut. Smith identifies this 25 percent increase in its traffic as the critical viral moment for PlanetOut -- from this point, traffic grew exponentially. The natural limit on a gay magazine -- that a large part of the universe of readers of gay magazines don't want to be associated with a gay magazine -- disappears online, the perfect furtive medium.

It is obviously important not to make too much of the irony that the consummate polished marketing guy failed while the misfit clown succeeded. There are, of course, perfectly awful marketing assholes making billions all the time, and clownish screwup behavior is almost invariably and severely penalized.

Still, there's a point here.

Henry Scott, a former executive at the New York Times who took over Out after Goff left, describes Out as having a consistent soul problem: "This is partly Michael's legacy, but I am to blame, too. The point is that neither of us was particularly interested in gay media -- wouldn't be caught dead reading gay magazines."

In the old-media paradigm, the media is about power, authority, legitimacy. The operative goal of Goff's Out magazine was to take gay interests and sensibilities and join them to some hip, moneyed mainstream. (The idea at Sidewalk, too, was that it would, in one fell swoop, wow the world.)

I don't think this is what new media does, or is capable of doing. New media is less symbolic, less evocative, less about making any specific kind of point. It's much more small-time. There is nothing particularly slick about PlanetOut. It feels efficient, local, unassuming. And authentic: Real gay people probably want to know real gay people rather than the Will & Grace type. When Rielly talks about PlanetOut, he invariably relates it to his identity search -- his first gay chat room in 1984 on CompuServe, the BBS services he frequented, the fidonet echoes, the Usenet newsgroups, and the Web. Boy-meets-boy, at its most efficient, is an unromanticized function.

Old media is about illusion. New media is about practicalities (a.k.a. the user experience).

After blocking various proposals to sell Out, which, operating near a financial break-even point, had been unable to build its circulation or advertising base, Goff gave up his hold on the magazine in December.

PlanetOut, with new money from Internet notables like Nicholas Negroponte and Rob Glazer, additional capital from America Online, and a new venture round from the Mayfield Fund, began to negotiate the acquisition of Out and The Advocate and assorted smaller gay publications, for $30 million worth of its several-hundred-million-dollar pre-IPO valued stock, betting that it could convert its much larger online user base into magazine readers.

In due course, PlanetOut will be the first gay-oriented public company, an idea that does not now seem particularly surprising. And, of course, Tom Rielly will be wonderfully wealthy.

As for Michael Goff, well, he's become a venture capitalist.