Demand Media doesn't actually pay bloggers to write, but they offer to syndicate your blog - basically, Demand Media will link to the blogger's posts. Yet they snuck in the contract this language:
Your Grant of Rights. Each of your Contributions will be original and solely created by you as a “work-made-for-hire” specially ordered or commissioned by us, with Demand Media being deemed the sole author of the Contribution and the owner of all rights whether now known or hereafter devised (including all copyrights and all extensions and renewals of copyrights) in and to the Contribution, with the right to make all uses of the Contribution throughout the world and all changes in each Contribution. Without further obligation to you, we may use, reproduce, edit, change, add to, take from, translate, reformat, or reprocess the Contribution in any manner.
Total scam by Demand Media, and proof that the best way to steal from a person is through an keyboard that writes with very small font.
UPDATE: I read Demand Media's press reslease for its "blog distribution network." It's a mighty fine piece of ad copy. It makes it seem like Demand Media will merely link to your blog:
As the latest innovation from Demand Media Studios, the network helps bloggers expand their online brands by syndicating their blog posts to Demand Media’s highly trafficked sites including eHow.com and LIVESTRONG.COM in addition to Content Channels partner sites.
As an added benefit, bloggers will also receive backlinks to their blogs with each post, which may help bloggers improve the rankings of their content in search engine results. All eligible blogs will be part of the Demand Media Studios revenue share program, where bloggers have the opportunity to earn revenue based on the pageviews that their posts receive on the company’s and its partners’ sites
Sounds like a good deal. It's not. Indeed, look at the contrast between the press release and the actual contract Demand Media hopes to fool you into signing.
The press release reads: "Blog posts that are syndicated carry an identifying byline to ensure that the blogger’s brand goes wherever their posts appear."
The contract - which supercedes the press release - states: "You waive all 'moral rights of authors' that may exist or any similar rights. We may, but are not obligated to, provide attribution to you in connection with any Contribution or to display, use or otherwise exploit any Contribution."
In other words, Demand Media can take your blog posts, remove your name, and there's nothing you can do. Demand Media can even demand that you take down your own blog, as Demand Media owns the copyright to your posts. In other words, by keeping your own blog up, you'd be committing copyright infringement against Demand Media.
It's a complete and total scam. Bloggers beware of Demand Media.