A song to read by: “Young Hearts (Polo and Pan Remix),” by Benny Sings

What I’m reading: “The Origins of Totalitarianism,” by Hannah Arendt

Published this week

— Exclusive: Recurrent Ventures Raised $300 Million. Where Did It Go?

— Minute Media Acquires STN Video, Expanding Its Video Footprint

— G/O Media Hangs ‘For Sale’ Sign Across Its Portfolio

— The Midst, Part of She Media, Launches to Tackle Midlife and Perimenopause

On my mind

This week was a bloodbath for the media industry, with layoffs sweeping through publishers including The Los Angeles Times, Business Insider, Time, Forbes, Sports Illustrated and others.

Sources I spoke to say the explanation for the culling was about as quotidian as it gets: 2023 was a horrible year for the industry, the fourth quarter fell short of expectations and nearly every company needed to cut costs. The only question was whether to do it before or after the holidays.

While the contraction of brand-name publishers has understandably captured the headlines, larger losses are on the horizon across the open web. 

On Tuesday, at the Adweek Outlook event in New York, I took part in a panel in which several Adweek journalists and editors offered their predictions for the coming year.

In one of my three predictions, I said that if the last two years have wiped out social publishers — i.e. the BuzzFeeds and Vices of the world — the next two will see the cratering of search publishers, a group I broadly defined as any website whose primary relationship with its readership is intermediated by Google.

If you just stopped and thought to yourself, “Wait, isn’t that basically every publisher?” then you have correctly identified why this is so worrisome. Search traffic from Google makes up the majority of readership for almost every website on the web.

But, as I and others have written for months, the rise of Search Generative Experience (SGE), the generative AI product from Google, threatens to eliminate a broad swath of the traffic publishers once relied on by answering search queries on page. Forthcoming legal battles will likely determine the rate and shape of this change, but few doubt that it will come eventually.

This factor is one of two presaging the end of the long-tail publisher, a euphemism used in the industry to describe less popular websites. 

The other is the shifting privacy landscape, which has made serving targeted ads on these websites harder. 

(Privacy advocates will tell you this is a benefit for web users, and they are right, but that explanation is too simple. In safeguarding consumer privacy, these changes will also kneecap the business model of thousands of websites, which employ thousands of writers and journalists.)

Apple removed third-party cookies from Safari years ago, and in the back half of this year, Google will finally do the same for Chrome. 

In response, publishers and advertisers have a variety of potential ways to replace the functionality provided by third-party cookies — using first-party data, alternate IDs, contextual advertising or any of several Privacy Sandbox initiatives from Google itself — but the point is almost a moot one.

For advertisers, the primary appeal of advertising across the open web has been that it enabled them to serve dirt-cheap, targeted ads. None of the alternatives listed above will allow them to serve those ads at the scale they once could or at the same price point.

Marketers who continue to advertise on the open web will work with fewer websites, because only publishers with robust pools of first-party data will be able to offer the kind of targeting they want. (The resulting scramble for first-party data is why you see publishers like the new and very good 404 Media openly making pleas like this.)

Every other website, particularly the kind that relied on a continuous influx of one-time readers to whom they could serve a targeted ad, is looking down the barrel of an extinction-level event. 

Marketers already prefer other channels with richer ad formats and better measurement capabilities — like CTV and retail media — over the open web; take away its cheap targeting, and the thousands of stray websites you happen upon once in a blue moon will go away.

As I mentioned last week, this will be a painful contraction, but it will produce a media ecosystem more similar to what existed in the analog days. Individual people will be harder to serve ads to on the open web, and only publishers that have cultivated loyal, direct audiences will survive. 

Eventually, as the aggregate volume of available advertising inventory across the web shrinks, publishers will be able to charge more, as marketers will have few other vehicles for reading people on the internet. 

But that scenario is years away, and it will only support a fraction of the publishers in existence on the web now — if it even materializes. 

What is certain in the short term is that the job losses of the last week represent just the beginning of a larger correction, as the artificial scale ballooned by the last decade of easy money and cheap targeting is finally punctured. 

The remaining publishers will more tightly guard their reporting, making registration walls and paywalls far more ubiquitous. Information will find itself taking shape much like it did in the pre-digital era, with a handful of publishers controlling its access. 

The issue is a symptom of a larger tension in digital economics, one that has always fascinated me, which is the back-and-forth between the concepts gatekeeping and democratization. 

The internet was supposed to democratize information, but as I wrote last week, advertising needs finitude to function. If content is splayed across a million websites, none of them can make enough money to survive.

The digital market is beginning a long, painful process of righting itself, as its operators realize that gatekeeping was never fully, or even primarily, about power or needless restriction. Instead, it was a function of economics, and one that we will soon see return. 

The week that was

This last week was hectic, but great.

On Tuesday, I moderated a panel at Outlook about the future of digital measurement with the president of Quad Media Joshua Lowcock, Gabriel Dorosz from The New York Times and the brilliant marketing strategist Ana Milicevic. Then I cut a podcast with Nada Arnot from The Economist and participated in the aforementioned panel with other Adweek reporters. Afterward I got drinks at The River with a friend in the art world who is working to launch a publication.

On Wednesday, I published this wonderful scoop about G/O Media, visited the Boardroom offices to speak with founder Rich Kleiman and attended a National Geographic event in the evening with friend and colleague Sami Lambert. At the event, I met and shamelessly took a picture with one of my favorite food media influencers, Lucas Sin, who has a new show coming with Nat Geo.

On Thursday, I published this story about Recurrent Ventures, which I have been working on for almost two months. I also got breakfast at Sadelle’s with a source who shared news with me that should be a story in the next week or two. That evening, I hung out with my good friends Firouz Saghri and the Digiday journalist Alex Lee, where we talked a lot about Twitch.

On Friday, wiped from the week, I nosed down a few stories but ultimately hardly left my room. I finally watched “Heat,” which I was somewhat ambivalent about. The next day, I ended up watching “American Fiction” on a date, but was also a bit nonplussed by the film. So far my nominee for Best Picture is “Poor Things,” but I still have to watch “Anatomy of a Fall” and “Zone of Interest.” 

Then on Sunday, I went with friend and coworker Annie Hamilton to Meet the Breeds at the Javits Center, an event hosted by the American Kennel Club that is effectively a Noah’s Ark for dogs. You basically get an opportunity to pet every breed of dog in existence, which does not combat seasonal affective disorder quite effectively as a vacation but is a close second.

One good rumor

I heard a major news publisher is planning to cut its D.C. bureau in half this week, which would make it the second, behind the LA Times, to do so in an election year. I understand cost-cutting, but the timing seems illogical.

Some good readin’

— Brian Morrissey gets at some of the main culprits to blame for the woes of the modern media industry. (The Rebooting)

— Great scoop from Ben et al. about an instance of editorial oversight at the Los Angeles Times that reflects the tensions between its billionaire owner and formed EIC. (The New York Times)

— Imagine spending 500 days in a cave! (The New Yorker)

Cover image: "Death and the Masks,” by James Ensor