To what do we owe the current boom in subscription-based newsletters? Well, there are a number of reasons: 

• We’re all sitting at home, anxiously browsing our feeds and looking for sharp new voices to help us make sense of the current pandemic hellscape. 
• The advertising industry is in free fall, making subscriptions all that more appealing as a sustainable business model for major publications and independent writers alike. 
• The market is currently awash in thousands of underemployed journalists who also happen to be great writers: pointed, funny and keenly focused on specific topics. 
• The oft-maligned email inbox remains an absolutely essential distribution channel, particularly for people looking for snappy summaries of the day’s headlines from popular newsletters like Morning Brew, The Skimm and The Hustle. 
• But perhaps most importantly, the industry has settled on a central publishing and revenue platform in the form of  Substack (more on that later).  

If the digital media industry’s pivot to subscriptions has been underway for several years, COVID has acted as the ultimate forcing function. Josh Sternberg’s excellent media newsletter The Media Nut neatly captures the broader context for this shift (namely, an obsession with digital advertising revenue by hip sites like Buzzfeed and Vice that never materialized):

“As legacy publications transitioned to digital they got caught in the whirlwind of the ‘disruption model’ of the whizbang websites that, backed by venture capital money, didn’t have a circulation department because they didn’t have a print product to circulate.

Instead, they ballooned web traffic as a proxy for paying eyeballs and tried to get an industry to build up ad rates to coincide with that rise. Look at all this potential money we could charge advertisers by saying ‘scale’ and ‘reach’ over and over. This was a fool’s errand, as we now know. Higher traffic doesn’t equate to more money.”

Needless to say, the thousands of journalists who witnessed this carnage firsthand are all keenly aware of the benefits of subscriptions over imaginary eyeball-based ad revenue. Defector, for example, the upcoming sports site born from the ad-fueled wreckage of Deadspin, will be a subscription-based publication when it launches later this month. Besides, who has the resources to compete with Facebook and Google for digital ad dollars? 

So what happens if a journalist with a sizable social media profile loses their job, or decides to strike out on their own? Or an expert on a particular subject matter decides to spin up an independent venture? Enter Substack. 

As New York Magazine’s James D. Walsh notes:

“Over the past few years, online-publishing platforms have made it easy for users to charge a subscription fee for newsletters. As Facebook, Google, and private equity have laid waste to print media nationwide, these platforms have given rise to a new publishing economy, in which any writer with a dedicated following might be able to make a living. Of all the platforms out there, Substack, launched in 2017, has become the preferred tool for writers striking out on their own. According to the company, more than 100,000 subscribers now pay for at least one newsletter, and the platform’s top users collect hundreds of thousands of dollars in revenue, which, in some cases, amounts to more than they might earn as staff writers at legacy publications.”

Substack collects a ten percent fee from all subscriptions, which allows it to operate without advertising. Readers get to support the writers that they trust directly, and writers get to concentrate on creating a great service as opposed to handling a bunch of logistics.  Morning Brew CEO Alex Lieberman sums up the appeal to Media Nut:

“What journalists love doing: create great stories that people consume and give a different view of the world. Journalists, however, don’t like doing back-office stuff related to the media business. You know, like accounting, sales, tech. To most journalists, it’s not super interesting. So what Substack has created is the ability to focus on your craft while also being able to provide yourself a livelihood.” 

The company offers an app store-like list of its most popular writers. Some of them are clearly benefiting from the past work they’ve done at high-profile publications (Matt Taibi from Rolling Stone, Andrew Sullivan from The New Republic and New York), but most have established themselves independently. All of them benefit from having a specific area of expertise: China, the climate crisis, historical perspectives on politics, Hollywood, etc. 

If you’re interested in checking out some of the more popular newsletters, New York has a great guide to the newsletter economy that summarizes the bigger titles. Personally I’m a fan of Matt Taibi, Media Nut, and Stratechery, and I want to check out “Discourse Blog” and “Welcome to Hell World.”  For more thoughts on digital media from our own excellent Subscribed Institute, check out this excellent “Reimagine Media” piece with thoughts from Penske Media and the Seattle Times.