Why has Medium’s shift in business model created so much controversy? Actually, no, controversy is the wrong word. The response has been dismissive. That seems curious to me. Why would an industry that has been so in love with the idea of generating reader revenue feel so uncomfortable about a business predicated on that?
Palaeolithic blogger Dave Winer even called it the beginning of the end for the site. That makes sense: Dave is still fighting the good fight for the open web, and his concerns about Medium’s “destination” nature, and the possible loss to the web if it fails, are warranted.
I have the most sympathy for the sites who committed to Medium’s earlier, and abandoned, vision. They got burnt. They’re not going to be quick to head back to the fire. But their experience does pose another question: When will this industry learn the lesson of diversified revenue?
Perhaps the rest of the scepticism is the natural response to a project headed up by a man who has had two, huge, paradigm-defining successes: Blogger and Twitter. (But not Odeo. Let’s not talk about Odeo.) There’s more to it than that, though. Something about the new approach to Medium’s business seems to make many people in traditional media uncomfortable. The wholesale rejection of the site by big publishers means it’s dead, right?
From the mainstream of journalism thought, though, there’s a sense that Medium is over.
It can be tempting to write Medium off for dead. The company laid off a third of its staff earlier this year. The bigger-name publishers who migrated to Medium have left. (Goodbye to: The Ringer, Backchannel, The Awl, Pacific Standard, Film School Rejects, ThinkProgress.) They mostly returned to WordPress — or in The Ringer’s case, to Vox, or in Backchannel’s case, to Condé Nast.
“The move to Medium was a cool experiment, in my opinion, but the year is up and personally I missed the ads,” wrote Sylvia Killingsworth, editor of The Awl and The Hairpin.
So, why the end of days feeling? Why are publishers, still struggling for sustainable business models in the digital era, so dismissive of the new Medium experiment? To answer that question, we need to look at the past of both Medium itself and the publishers.
A (very) brief history of Medium
A couple of years ago, Medium was languishing under the name “platisher” – somewhere between platform and publisher – and then it seemed to lean into being more of a platform. Its own publications were closed or spun off. External publishers were invited in, and offered an advertising model to help support them. The recent staff losses, and shift to a membership model have seen publishers depart en masse from the platform.
Instead, we are invited to participate in a form of paywall – a premium version of Medium available for those who are willing to shell out for a small monthly membership fee.
Publishers who choose to publish for those members only can earn a share of revenue based on an engagement algorithm, that includes the number of claps that your story receives.
This is a model based on the impact of writing. One of the things I do for a living is train journalists on how to use analytics creatively in the newsroom. That’s showed me how many of them are very nervous of any attempt to monetise impact. Journalists don’t like to be judged — rather ironically, as they’re often in the business of judging others.
Connections between content success and revenue have to be made though, whatever the business model you’re using.
There are only really three content-funding commercial models that anyone has figured out with any success:
- Advertising – including “native advertising”, which is what the young people are calling advertorials…
- Membership – paywalls fall under that
- Indirect monetisation – for example, using content to drive events sales or affiliate revenue.
Once Ev Williams had explicitly rejected the first, then the other two came into play. And who can blame him? Everyone is playing for the ad pot, and when your competitors are Facebook and Google, you better be damn sure that you offer something unique that they can’t replicate technologically. Every month sees another “safe” niche fall before those behemoths.
Joining an already crowded marketplace is rarely a smart way to make a business work, unless there’s more cash sloshing around than the incumbents can soak up, or you’re offering something so profoundly different you can disrupt the space. Brutally, neither of those was the case.
New Medium, new model
So, instead, the new Medium (fresh logos and all) is taking a step into the membership model space, leaning into the original vision of the site being the best place to read long-form content, and of getting your long-form content found.
The challenge, perhaps, will be squaring the two sides of Medium:
- The platform where anyone can publish for free
- The platform where professional writers create for a paying audience
There’s a tiny overlap in the Venn diagram of that, with non-paying members getting three free members-only articles, and the partner program publishers still able to publish to the whole Medium audience.
The two halves seem to work in concert: the free writing and reading is the top end of a funnel, that will hopefully draw in paying members attracted by what might lie beyond what they’re getting for free. So, yes, a freemium model of sorts. You can publish and read on Medium for free, but you become part of a deeper, more interactive community if your shell out for a membership – and if you make the effort to create content for that community.
The model makes sense. The big question is, of course, numbers. I suspect Medium will have little problem attracting writers – but they will need to practice a level of quality control to prevent it becoming a sea of “me too” marketing platitudes or lifestyle advice. The real trick will be incentivising people to become paying readers.
Happy, clappy membership
It’s also interesting to note, that the “claps and membership” model will almost certainly support small, individual journalistic enterprises much more easily than it will traditional publishing operations. Why? Big publishers carry with them associated overheads, while an individual using an off-the-shelf platform doesn’t have to pay for HR, IT – or even real estate. I don’t think clapping revenue will ever sustain a business on that scale. But it might well sustain, or at least help sustain, an emerging individual voice.
Much of the early push towards web publishing favoured the individual over the big company – the blogging boom of the early 2000s birthed many bloggers who are still making their living from it: Jason Kottke, John Gruber and Heather Armstrong, just to note three very different examples. Gruber earns his revenue through blog and podcast advertising, Kottke through memberships and advertising, and Armstrong through sponsored posts and advertising.
Membership models complete sustaining individual are rarer, but one good example is Ben Thompson’s Stratechery, which provides daily tech market analysis for a market of paying subscribers.
These are all people who embraced the new, and found ways of monetising based on that. That’s not what so many of the big publishing brands have done.
From the earliest days of digital, publishers have sought to remake digital in ways that suit them, rather than rethink what they do to match the new era. Look at the lip service paid to “mobile friendliness”: there’s more to it than just making sure your content renders well on a mobile phone, you also have to think about the sorts of content people will want to consume content in on mobile – and the formats that will support that. And how many publishers are genuinely doing that?
Most businesses – if they were honest – have been looking for digital models that allow them to continue doing pretty much what they were doing before. A hugely challenging task – one none of them have truly pulled off – that has only one compelling benefit: it doesn’t force you to change too much. And much of the industry is staffed by executives who grew up in an era of incremental change at best. They’re not the sort of people who enjoy big changes – and the industry has been remerkable successful in expelling those who truly embrace change.
A platform that doesn’t support their “big staff, big numbers” approach will never attract their interest. That’s just too much change.
A half-hearted embrace of digital
That’s also why publishers have been so very slow to truly embrace video and podcasting. Oh, sure, they’ve been doing it, but they’ve been producing content that looks like, well, radio and TV. Meanwhile, genuine innovators started developing whole new languages for those mediums that looked nothing like the predecessor forms. Show a “video professional” the work of many YouTube celebrities, and all they’ll see is the glaring faults, the rough jump cuts, the unprofessionalism. But what they don’t see is the engagement, the intimacy and the success.
There’s a perception that YouTubers and lifestyle bloggers and their ilk are a niche – right up until you see where increasing amounts of marketing budgets are disappearing. If your business is ad-dependent, and you can’t follow the money, because your pre-established notions of what “high quality” content looks like won’t let you, your business doesn’t deserve to survive.
In other words, the publishing game doesn’t like, and isn’t good at spotting, that competition often doesn’t look like it. As Medium moves away from a model they recognise, they’re inclined to dismiss it. Medium is now “not us”. That, if anything, might suggest that it’s going in the right direction…
What both vlogging and podcasts benefited from, though, was a central place to build an audience. In the vloggers’ case in was YouTube – which also acted as the original monetisation channel. For podcasters, it was iTunes – but monetisation proved, and remains, more challenging. But businesses are growing around it, like 5by5 and relay.fm.
Medium allows the same possibility for text-centric (or, hopefully, multimedia-centric) storytellers. It’s a platform – a destination – that people can come to read, and writers can (hopefully) find an audience. It’s a new take on the world of blogging, one that doesn’t involve cosying up to brands and an “influencer” to have any hope of making a living.
And, so far, it’s untested. So, clearly, this experiment could fail. Maybe it’s even likely to fail.
It’s going to be niche at best.
He’s probably right. But that’s not necessarily a bad thing. I come from the world of niche. Much of my early career was in the world of B2B or trade publications. They’re a niche – but many of them remain profitable and sustainable niches in business, because the dynamic of connecting together a community of professional practice through information that makes their working life easier is useful.
This niche is the sort of person who will write useful, in-depth content – and the sort of people who will read it. It’s the niche that was developing in the early days of blogging, before the simplified forms that make up what we call social media sucked all the attention out of the ecosystem.
That niche exists. But is it big enough to sustain Medium? Let’s find out…
Adam Tinworth used to be a journalist, but these days he trains journalists and consults to try and make what’s left of this damn industry work better in digital.
He can be found blogging (old skool) at One Man & His Blog.