This week’s edition of The Rebooting is written from Munich, where I spoke at Medientage München on Monday about post-Covid accelerations in the media business. Big thanks to the MTM organizers for having me.
This week, I’m taking a look at why creator-led media businesses will prove more durable.
The media business is an oddity because media companies historically have only rarely been run by someone with deep experience on the content side. Sometimes a media CEO will be a former journalist, although usually long ago having crossed over to “the other side.” More often than not, you’d find a leader from sales.
The reason is simple: Advertising has been the basis of much of the media business, so the customers aren’t the audience, they’re the advertisers. The “content people” were often treated like temperamental pets, safely walled off behind the “church and state” divide, which existed to protect editorial independence but often also served as a way to keep the content monkeys in their place. And most journalists were willfully oblivious to the actual business. I heard reporters brag about not knowing anything about how their product makes money or from whom. Ignorance is bliss.
Of course, that was mostly the rank and file. Those who get near the top of newsrooms are typically very engaged with how the business is run. Ideally, a media company would have a strong partnership between the sales and editorial sides. That said, when it came to the direction of the business, I always found sales to have the upper hand. Editorial was situated upstream from revenue, creating the content and point of view that attracted an audience that the smooth talkers with great teeth and nice hair on the sales side would then use to extract money from advertisers. In truth, the content side was often treated as an expendable resource to be exploited and then replaced.
The imbalance of power is clear when you see the atrocious user experiences on most websites. Sites firing dozens of tracking pixels, with auto-play ads jostling each other on the page, relegating the editorial to a tiny sliver of the screen, sacrificed on the altar of monetization. Objections to this abuse and shamelessness rarely go in the newsroom’s favor; after all, when it comes to making money, what do journalists know?
The reporters I encountered early in my career who were blasé about the business dynamics gave way to a new generation that were acutely aware of the economic pressures the media business was under. Many experienced the gyrations of the business early in their career, being used up and spit out by content farms that expected them to churn out five or seven pieces a day only to be laid off because the supposed business experts couldn’t make the model work. The young reporters I hired wanted to know many details about how sustainable the business model was. At some point, Charlie Brown wises up when lining up to kick the football.
The shift to direct revenue models, most notably with subscriptions and memberships, shifts the balance inside media organizations. Suddenly the editorial side is literally the business side. The editorial isn’t a lure to bombard people with auto-play video ads. It’s the product that generates revenue based on its quality.
We are currently in an unbundling phase as more writers and podcasters strike out on their own and others join writer collectives like Every or creator-led micromedia companies like Defector and Puck. Substack is proving a viable model for many solo media entrepreneurs who are building solid businesses. What’s striking about the one-year-in posts from successful Substack writers is the justifiable pride taken in the product, not just the revenue. The future of media might be smaller but it’s likely more meaningful.
I’ve spoken to some operator types who have plans for rebundling independent creators. I’m open minded, but for any of these efforts to work, the creators themselves need real ownership and to be largely calling the shots. Too many operator types think people are going off on their own just to make more money. That’s not the case. Most want independence. That doesn’t mean they won’t need help and to learn many new skills. The need for partnerships is critical.
When the creator is defining the business the approach starts with the thing they’re making -- a newsletter, a podcast, video series -- with the business model then matching the mission. Often the operator class starts with the business model and distribution and works backwards. That can and has worked, but it’s also the approach taken to an extreme by Ozy, created to appeal to investors and advertisers first and foremost. The audience was secondary -- in fact, much of it was paid for. Too much media is similarly synthetic, created to appeal to algorithms instead of actual people. This isn’t a recipe for long term impact. Many publications that collapsed in the wake of relying too much on Facebook weren’t missed at all. Nobody is mourning the loss of Little Things.
I suspect audience-first media businesses will inevitably be more durable. The operations part of the equation is without a doubt a challenge, and a sustainable business model obviously requires an efficient infrastructure. That said, putting the operations part first is part of what got the media business into this mess in the first place. Better to try a new approach.
Thanks for reading this week. As always, I love to hear from readers with thoughts, comments and disagreements. Email me at email@example.com.