In its first few months, the Politico website settled into a steady pace of about 25 articles a day when Congress was meeting. If Congress was out of session or not active, there could be as few as 10 new pieces a day. Some of those Web articles were repackaged for the paper, which published Tuesday through Thursday (when Congress was not in session, it published Tuesdays only). The newspaper staff also did their own reporting.

Meanwhile, Politico began to establish itself as a media player in its own right. In February 2007, Allbritton arranged for Politico and cable news station MSNBC to co-sponsor the first debate, scheduled for May 3, among the candidates vying for the Republican presidential nomination. Politico readers would submit questions to reporters through the website, and the reporters would select those to ask the candidates. In addition to its partnership with Allbritton's NewsChannel 8, with whom it shared office space, Politico also had partnerships with a DC-area all-news radio station (WTOP) and with CBS news programs. [1]

Harris and VandeHei’s hunch that renowned journalists would pull in readers seemed to have hit the mark. Correspondent Mike Allen, notorious in Washington for his workaholic schedule, was particularly popular for his prolific commentary and wide-ranging sources. His early-morning political news roundup, “Playbook,” was on the website by 8:30 a.m. and quickly became a must-read item for Washington insiders. Other Politico reporters focused on gathering news available nowhere else. Blogger Ben Smith scored Politico ’s first major scoop in November 2007, when he reported that presidential contender Rudy Giuliani had as New York City mayor billed “obscure city agencies” for a series of expensive trips. Based on the dates of the expenses, Smith wrote, the travel appeared to relate to an extramarital affair Giuliani was then beginning with his future wife, Judith Nathan. [2] The story was widely cited in other news outlets. By securing this and similar scoops consistently over a period of months, Politico earned a reputation for high-impact reporting.

Who pays? The funding model for Politico was multifaceted. Owner Robert Allbritton was indispensable to helping the organization find its financial feet. He had been willing to invest more than $10 million in a Capitol Hill newspaper; he presumably was ready to spend at least that on his hybrid project. Allbritton had made it clear that he expected the publication’s expenses to exceed revenues—that is, the publication would lose money—for some 18-24 months. “That’s a pretty realistic time frame for a startup,” he said in an interview. [3]

Politico held down operating expenses with a small, specialized staff of around 50; at the same time it had several revenue sources. Least among these were subscriptions. While the newspaper was free at specific distribution sites across Capitol Hill, and delivered at no charge to lobbyists and lawmakers, those without physical access could order it delivered. Subscriptions were $200 for domestic subscribers for one year, and $350 for two years. Overseas subscriptions were $600 per year. But about 90 percent of Politico ’s 30,000 paper copies were distributed for free. [4]

Outside of Allbritton’s funding, Politico was almost entirely advertiser supported. The newspaper offered good rates to those who wanted to reach the policymakers that made up much of its audience. A full-page color ad in a national newspaper like the New York Times could cost over $100,000; the same kind of ad cost only $11,000 in the paper edition of Politico . [5] Roll Call and The Hill , the two established Capitol Hill-only newspapers, charged similar rates, but Politico —thanks to the website—had the advantage of a burgeoning national brand. Then there was revenue from Web advertising. A small online classified ad ran about $300 a week. (An existing print advertiser could purchase a Web advertisement for $85 a week.) [6] Banner advertising was priced according to the number of clicks the ad received—cost per thousand clicks (CPM) varied according to the size, type, and multimedia elements of the ad, as well as the nature of the organization purchasing it .

In November 2007, Politico appeared for the first time on the magazine Editor & Publisher ’s list of top 30 most-visited newspaper websites, ranked at number 26. That was a valuable laurel. But it did not mean the enterprise was making money: Politico's net operating loss in 2007 was around $5 million. [7] Allbritton had expected to lose money, but it was still a substantial sum. In fact, to the surprise of many (though not to Allbritton, champion of the newspaper), for all the recognition accorded the website, the advertiser-supported Politico newspaper was out-earning the website—bringing in 60-70 percent of the organization’s revenues.