Substack and the Future of Journalism

-- By BenWeissler - 20 Nov 2020

A spectre is haunting news media — the spectre of email newsletters. But does it matter?

Newsletters are just one among many methods of delivering news, piggybacking on a technology (email) that predates even the web. The New York Times, for example, delivers news to readers in print format, on its website, in its mobile app, and via dozens and dozens of email newsletters. But the reason newsletters are now generating splashy headlines and think pieces has little to do with the format per se. The buzz is really about a change in the underlying business model of news: a move from advertising to subscription revenue, and from large, well-capitalized newsrooms to solo journalists and writers striking out on their own.

In the last year, there’s been an exodus of high-profile media figures leaving traditional outlets and setting up personal newsletters. Andrew Sullivan left New York Magazine. Matt Taibbi left Rolling Stone. Glenn Greenwald left The Intercept. Matt Yglesias left Vox. All decamped for Substack, which is quickly emerging as the dominant newsletter platform — offering writers “an array of tech tools” to help manage their newsletters and taking a 10% cut of subscription revenue in return.

Why is Substack and the newsletter resurgence noteworthy? Anyone who cares about building a vibrant public sphere, reducing the amount of misinformation, and healing America’s deep partisan schism should take an interest in the way news is produced and consumed.

How Newsletters Became Popular

The explosive growth of newsletters can be understood from two sides of the market: from the perspective of people who make news, and from the perspective of those who read it.

The Writer's Perspective

Sullivan, Taibbi, Greenwald, Yglesias: there is easy narrative here about the departure of contrarian political voices from media outlets that are becoming less and less hospitable to dissenting views. It is no coincidence that these outlets are currently engulfed in fiery internal debates about their missions as news organizations. Do they exist, as conceived in the “liberal” tradition, to dispassionately report news while exposing readers to a wide range of opinion? Or should these outlets shine a spotlight on wrongs and work towards a better, more equitable society? The New York Times’s publication of an op-ed by Republican Senator Tom Cotton (and the resulting fallout) is probably the most notable recent example. But there are many other examples.

But stepping back from these squabbles, there is another story here about news media's ailing economic health. Newspapers employed almost 500,000 people in the mid-1990s, down to just 150,000 today. There is a phenomenon called “elite overproduction” — the fierce competition among qualified college graduates engaged in a game of musical chairs, vying for a dwindling number of media seats — which some believe explains the intense media infighting. Local news is in shambles. And meanwhile, the digital media companies (BuzzFeed? , Vice, Vox, etc.) that were lauded just 5-10 years ago as “disruptors” and thought to represent the future of journalism, have been forced to cut staff, while the old guard swoops in to pick remaining talent off the bones. In the face of this bleak media outlook, why wouldn't an enterprising writer strike out on her own? And particularly if you are a “star” commentator who already has a large following, what’s stopping you from becoming rich off the “tens of thousands” of subscribers willing to pay you $5 (and up) per month?

The Reader's Perspective

From the reader's perspective, the newsletter format presents several attractive features:

• Newsletters offer a feeling of intimacy that is missing from the plain web. Email simulates a one-to-one connection between writer and reader. A newsletter is a respite from the “noise” of social media. And it provides a more curated experience than the overwhelming firehose of content published by, e.g., the New York Times.

• Newsletters promise depth, not breadth. If a reader is really passionate climate change, zoning policy, or bitcoin, that reader might rather pay to hear from writers with expertise in those areas, versus paying to bankroll a whole group of journalists covering topics they care less about.

• Except for the print newspaper, an email is just about the most “tangible” a news product can get in today’s day and age. If I’m going to pay for other people’s thoughts and writings, I may well feel that I receive subjectively more value for something that is pushed directly to my inbox, versus content that exists "somewhere else" on a subscription website.

Where We Go From Here

The success of Substack shows that readers are hungry for a model of news distribution that at least mimics decentralization, a model based on trust and connection instead of impersonal algorithms. But of course the idea of a one-to-one connection between writer and reader is a fiction. In the newsletters becoming popular today, there is a silent third: Substack. As long as Substack is interposed between writer and reader, collecting “browsing history, search history, and interaction data,” there can be no true anonymity of reading. And with Stripe, Substack’s payment processor, and Gmail (the endpoint where most of these newsletters will be read) in the mix as additional intermediaries, you can truly bid anonymity farewell.

There are many unresolved questions and causes for concern. The Substack manifesto includes a promise to never sell the data it collects and to never accommodate ads in its publishing system. But can it really deliver on that promise? Ads and sponsored content have already begun “creeping” into many Substack newsletters. It remains to be seen whether open-source alternatives to Substack, like Ghost, will take root. And the overall effect newsletters will have on media is unclear — will deep investigative reporting that was once (in a sense) subsidized by the readership’s interest in more trendy or prurient topics suffer as op-ed columnists leave for Substack?

Although newsletters are clearly “hot” right now, what happens as second- and third-order effects play out? As the number of newsletters I’m subscribed to multiplies, I find the idea of a centralized recommendation system — perhaps a newsfeed — to help focus my attention, more tempting. As I pay more and more writers for their separate perspectives, I start to wish for a bundled newsletter — maybe something resembling a newspaper. And if we end up reproducing social media and the New York Times, did the newsletter really matter all?

The point is the effort to pay the creator directly, disintermediating the publisher. The point is not that the writers are abandoning the publishers: it's that the publishers—by moving to the subscription model by erecting paywalls—while also seeking revenue through interoperation arrangement with the platform companies pillaged their relationships with the people who did the reporting, writing and editing. The journalists, on the other hand, need what I said in the 20th century 21st century creators would need: a sustainable audience, that is, a readership that will voluntarily pay what the creator needs in order to make what they both value in the way the journalists want. This is what I meant in the conclusion of Anarchism Triumphant in 1999 in suggesting that music and journalism would be next affected by the changes in political economy resulting from the shift to zero marginal cost goods.

Despite the big industrial problems of making and distributing press artifacts in the pre-digital world, these are now zero marginal cost items made by a small number of people: reporters and editors have always been the tiniest fraction of the labor force of a newspaper. That means direct payments to creators are efficient for both authors and readers. That stays true when they assemble into co-ops at any scale.

I think your best route to improvement is to cut the descriptive material moderately hard: we can assume that your readers know the terrain, and there are plenty of things you can cite to for the detail, including Anna Wiener's excellent piece this month in The New Yorker. That gives you more room for analysis, so that instead of ending with a rhetorical shrug you can deliver more for the readers.

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