Domestic Affairs

Software Is Eating Your Favorite News Site

In August 2011, one year before the IPO of Facebook, and not even a year after the debut of Instagram, software engineer and venture capital head Marc Andressen made a startling declaration in the pages of the Wall Street Journal: software was eating the world. Andressen, a figure in the tech industry since its 90’s-era infancy, saw that the world-changing promise of the dot-com era was on the verge of being realized through superior hardware and software. Viewing rapid software disturbances of the music, retail, and job-recruiting industries, Andressen remarked “all of the technology required to transform industries through software finally works. “

“In many industries,” Andressen continued, “new software ideas will result in the rise of new Silicon Valley-style start-ups that invade existing industries with impunity.” In the age of Oscar-winning Netflix films and Zoom classrooms, few people would challenge that Andressen’s prediction has been confirmed.

As the wave of software innovation overturns many industries, there is one area that is particularly curious — the media. Innovation increasingly changes how people talk directly to each other, whether the medium is a Zoom video chat or on Clubhouse. Perhaps more consequentially, whether through Twitter notifications or digital articles, software is shifting how information is transmitted in written form. One of the more interesting innovations in this space is the rise of the blogging platform Substack, which not only exists as a legitimate platform for opinion pieces but is poaching talent from well-known publishers. Watching as Substack’s software takes bites out of the nation’s assorted media, it is worth exploring how a blogging platform asserted itself in the commentary space, how it fits into a larger trend of technological innovation within the journalism business, and what shifts could occur in the fourth estate as a result.

Though the ongoing Substack shift in the media landscape reverberates around the media landscape, it is a slight echo of the first-wave digital assault on the news industry. Classified ads, which made up almost 70% of newspaper revenue, were wrested away from newspapers with the rise of Craigslist and other online marketplaces. This hit to revenue became even more deadly as the slight decline in newspaper subscriptions (which coincided with the rise of cable TV news) developed into a complete tailspin around the mid-2000s as newspaper audiences fell almost 7% per year. In 2009, besieged by shrinking revenues, circulation, and a collapsing economy, a variety of newspapers, including the San Francisco Chronicle and the San Diego Union-Tribune, faced either bankruptcy or fire sales. Newspaper revenue fell a staggering 25% from the prior year. Pew Research Media summed the mood up well when they wrote that they were publishing “the bleakest” report on the media they had ever written at the time.

Despite those hard times, the news media continues to exist in a variety of online forms, whether they are smaller independent organizations or the largely digitized versions of the giant national newspapers. There is clearly no dearth of news-y websites to find opinion and commentary, but what motivates the current news sphere that allows it to survive where its previous iteration failed? One reason is the prevalence of what might be termed ideological narrowcasting.

Narrowcasting is a term for a phenomenon that most news consumers naturally intuit: the “targeted segmentation of media dissemination.” There are very few news organizations that all portions of the American consumer marketplace visit for news and opinion. Instead, in the same way that local newspapers could find a reliable market based on geographical location, many news and commentary sites rely on extreme engagement with an ideological sliver of the market.

Narrowcasting is quite well-suited to the modern age. In the current era, where any listener is besieged by a deluge of information, the ability to have it presented in a synthesized, comprehendible way is vital. This is the same spirit that drove pre-Internet AM talk radio and opinion periodicals, such as The Economist or National Review. As the news industry was being dealt near-fatal blows in the late 2000s, the Daily Show with Jon Stewart drew over a million eyes per show to its mix of comedy, opinion, and news — all of which were tailored to a specifically young and liberal demographic. At the time, the popularity of the Daily Show sparked debate over whether it was “journalism,” opinion, or some combination of the two. Regardless of the answer, Stewart’s show heralded the future of news and paved the way for the rise of the e-narrowcaster website. Ideologically driven mini-publications are too many to count, but almost anyone can name some ranging across the whole of the left-right spectrum, whether Salon (founded 1995), Slate (1996), The Huffington Post (2005), Breitbart (2007), The Daily Caller (2010), or Vox (2014). 

It is of note that these periodicals rarely break news — oftentimes, the content on the sites is more commentary or analysis on the news itself. The focus is not necessarily to bring awareness to the fact that an event occurred. After all, the visitor to the site probably already saw the news on Twitter, TV, or any other number of locations. The function of these sites, which draws clicks and attention, is to interpret the news — a process which sometimes lends itself to a chain of commentarieson commentarieson commentaries on even the slightest topics. Through this chain of recursive writing, the commentary often becomes the news itself, and the lead members of the commentariat become notable, well-followed figures in their own right. Eventually, Substack would utilize this shift in organizational power dynamics to jumpstart their own platform.

When it comes to Substack specifically, the first quality worth noting about the company is that the service provided to writers is not particularly novel. Throughout the last decade, creators of all sorts have coupled free, large platforms like Youtube and Medium with donation platforms like Patreon, allowing the audience they built on the larger site to support them and receive exclusive benefits. More enterprising individuals started new paid websites entirely from scratch and built a livelihood off of that income. Though Substack directly acknowledges these earlier techniques on its own site, it goes on to iterate the most important benefit of the website: it makes the paid-newsletter process easy. While previous methods involved balancing different platforms or building one’s own, Substack provides an all-in-one platform to publish both free and paid articles, manage paid subscriptions, and view post analytics.

Legions of smaller Patreon users are not the only ones interested in this ready-made toolbox. The commentators at the national narrowcasting sites, who already had national audiences and attention, saw that they could essentially create their own mini personal newspaper — one with no editor, where they could set their own schedule and keep a staggering 90% of the revenue they brought in (with Substack taking the other 10%). When Substack coupled this value proposition with special flat-fee deals for big writers to minimize the risk of the initial switch to Substack, it became the superior choice for many amateur and professional commentators.

Writers at various commentary platforms and websites, including Glenn Greenwald (formerly of The Intercept), Matthew Yglesias (Vox), and Jonah Goldberg (National Review) migrated to Substack, driving further publicity and expansion of the platform. Currently, Substack’s most subscribed newsletters reveal a wide spectrum of topics — progressive and conservative commentators, recipes, hockey team analysis, someone claiming to be able to forecast Bitcoin prices, and a variety of other writers covering any number of subjects. In effect, the differences in the subject, style, and political leanings of each Substack poster have allowed the platform to simultaneously support thousands of narrowcasts, each to a highly engaged, paying market.

In the era of Youtube and Instagram, where everything is self-run personalities on a platform, the shift of commentary to the Substack model seems to make sense. For the commentary websites themselves, however, the rise of Substack could not have come at a worse time. The popular interest in political developments during the Trump era drew increased engagement and revenues for the past five years, but now that windfall is gone. As the economy remains crimped and the Trump-era engagement fades, the media is likely to face a new level of austerity across TV shows and news websites alike. Above all other categories, political narrowcasting sites are particularly hard hit by these lagging audience numbers, once they are coupled with the continued loss of writers to Substack. Some websites have asked for funds and warned of budget shortfalls, while others have seen major layoffs. As the resources narrowcasting sites can offer their staff keep shrinking, many have seen their writers who haven’t already fled for Substack get poached by news juggernauts like the New York Times. In the same way that the advent of online news killed newspapers, the increasing pull of Substack coupled with the end of the Trump years is likely to kill, or at least significantly cull, the e-narrowcasting organizations.

In the end, though the rise of Substack is a monumental shift in journalism, monumental changes of this sort almost feel like they are standard. The same online-driven creative destruction that provided the opportunity for small narrowcasting websites to begin is the same thing driving the technological tailwinds that will likely shutter much of the genre.Technology is eating the Huffington Posts and Buzzfeeds of the world in the same way that it devoured the Rocky Mountain Newses and Seattle Post-Intelligencers of the past. The process is not personal, nor is it the “attack on journalism” that some have categorized it as. The story of Substack’s growth is nothing more than a micro-event in the larger trend of technological change, innovation, and obsolescence that characterizes today’s modern life. As Andressen predicted, software is eating the world, and the only question is what segment of life that it might consume next.

Categories: Domestic Affairs, Tech

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