Welcome! I'm Simon Owens and this is my media newsletter. If you've received it, then you either subscribed or someone forwarded it to you. If you fit into the latter camp and want to subscribe, then you can click on this handy little button:

Let’s jump right into it…

My latest: Why The Globe and Mail trusts an AI to run its paywall

Would you trust handing over your homepage to an AI? The Globe and Mail did, and it's reaped huge benefits as a result.

Do your subscribers actually want paywalled content?

Earlier this week, I posed a question in my private Facebook group:

Let's say you have a favorite newsletter writer. You open up every single one of their free emails. One day the newsletter writer announces that they're going to quit their day job to work on the newsletter full time, and to support their work they're going to launch a paid product.

Which of these two paid products would you be more likely to pay for:

1. $10 a month subscription. For this price, you get four newsletters/articles a month that are exclusive to subscribers.

2. $5 a month subscription. For this price, the writer keeps 100% of their content free. There might be a few extra perks for paying subscribers, but mainly the reason you're subscribing is to support the writer whose newsletter you almost always open.

The sample size was small (only 21 comments total), but the vast majority of respondents chose option 2, and even the few who answered with option 1 seemed to all offer caveats that led me to believe that they were really leaning toward option 2.

My timing was fortuitous, because shortly after I posted that question, Charlie Warzel announced he was moving his Substack newsletter over to The Atlantic. He wrote about why he made this decision, and his piece included this interesting tidbit:

From my experience, most people willing to pay for my content did so in a patronage model. Many wanted to subsidize it for others, which I thought was so rad.

This fits with a trend that I’ve noticed across the creator space.

Judd Legum, for instance, is one of the most successful writers on Substack, and though he started out with a steady stream of weekly paywalled newsletters, he completely removed the paywall in 2020 and took no noticeable hit to his subscription numbers. Today, he generates over $382,000 on the platform. Anne Helen Peterson writes Culture Study, the second most popular Substack newsletter in the culture category, and she too seems to have completely eliminated the paywall from her articles. Instead, she regularly offers up open discussion threads that are only available to subscribers.

What’s driving this trend? Two things.

The first has to do with the demands of content production. I’ve written about this before, but creators have to produce an incredibly high volume of both free and paid content in order to grow their businesses. If you don’t produce enough free content, then you’re not expanding the top of your funnel. If you don’t produce enough paid content, then you’re not doing enough to service your subscribers.

For solo content creators, this generates a lot of strain. It doesn’t take long for them to realize how difficult it is to feed these two insatiable beasts, and they’re often not super psyched anyway about artificially limiting their content’s reach. So they start looking for ways to reduce the amount of time that they spend on the paid content so they can devote more of their efforts to the free content.

The second reason we’re seeing this trend is that creators are increasingly coming to the same conclusion as Warzel: that most of their subscribers don’t actually care if content is paywalled.

People often subscribe to creators and corporate media outlets for different reasons. On the corporate side, there’s a more concrete value exchange. I pay $400 a year to subscribe to The Wall Street Journal, and it’s not because I’m excited about the idea of putting that money in Rupert Murdoch’s pocket. I subscribe because WSJ is a great business publication, and I need access to its paywalled articles to be good at my job.

I subscribe to four different creators on Patreon, and it’s certainly not for paywalled content, even when it’s offered to me. I give $3 a month to the movie podcast Filmcast, for instance, and in exchange they offer up member exclusive episodes. It would take me just a few moments to plug these member-only episodes into my podcast player, but I never bothered. I just like the free version of their podcast and want to support them.

There’s simply a different calculation being made when someone supports a creator; we want them to be able to create more of the work that we love, and we don’t care who else has access to it.

Of course, I’m being a little reductive here. I’m sure there are consumers out there who subscribe to creator projects specifically to access the paywalled content. But I also think that many creators are underestimating how open their audience is to the patronage model.

So let’s say you’re thinking about eliminating your paywall. What factors should you consider?

To start with, there’s price. A lot of B2B creators try to charge upwards of $20 to $40 a month for what they market as “premium” content, but the patronage model is subjected to a lot more price sensitivity. I doubt that many creators could get away with charging much more than $5 a month, and my gut feeling is that $10 represents the upper limit.

The messaging is also crucial. A lot of subscription publishers simply try to expose an audience to their paywalled content with the hope that at some point a reader will want to access an article badly enough to convert. The patronage model, on the other hand, requires communicating value and impact. A reader’s subscription dollars are explicitly tied to the creator’s ability to make a living from their work. I sometimes refer to this as “guilt” messaging.

I do think it’s important for the creator to offer at least some member-exclusive perks, even if they’re trivial. That’s why I like Anne Helen Peterson’s approach of subscriber-only discussion threads. They remove the burden on her to produce a lot of paywalled content, but they allow her subscribers to still feel like they’re part of an exclusive community.

Are there limits to the patronage model? Sure. But I think a lot of creators will have no other choice but to embrace it, mostly because they’ll struggle to meet the content production output that a paywall model requires. That beast always needs feeding, and for solo content businesses, there’s no one else to parachute in and pick up the slack.

This isn’t just a newsletter for hot takes

Sure, I have a little bit of opinion and analysis in each issue, but I also make sure to produce regular longform case studies that are packed with insights that will help you with your content career. For the podcast, I conduct in-depth interviews with media operators who walk me through, step by step, how they built their media operations. I’ve also published close to 50 case studies that offer insights into some of the world’s most successful content businesses.

There’s only one way to ensure that I can continue delivering this kind of content: by becoming a paid subscriber. Subscribe at the link below and get 10% off for your first year:

Get 10% off for 1 year

Quick hits

Spotify may be the most popular podcast player, but Apple still generates three times the number of podcast downloads. [Tom Webster]

Up to 9 million people either open a New York Times newsletter or listen to its podcast every day. Those kinds of readers/listeners are probably worth 10X compared to people who randomly land on web articles from places like Google or Facebook. [Adweek]

This is how Facebook lures back younger users: by simply recruiting top GenZ TikTok and YouTube stars and paying them to produce exclusive content for its platforms. [Tubefilter] Yes, I really think it's that simple. Facebook has a ton of money it can just throw at top Gen Z stars. Those Gen Z stars, in turn, will generate network effects that make Facebook a destination for younger users.

Speaking of which, Facebook Gaming is now scoring more watch time than YouTube Gaming. [Tubefilter] This seems big, if true. Why does YouTube struggle so much in attracting live streamers?

The New York Times now has over 1 million subscribers who live outside the U.S. That certainly points to future expansion possibilities that involve the resurgence of foreign bureaus. [NYT]

A Substack newsletter is moving over to The Information. Apparently it's building out its own newsletter network? How did I miss this news? [Parqor]

This is a fascinating experiment in newsletter discovery. This guy basically created a Stumbleupon, but for newsletters. [The Sample]

ICYMI: Lessons learned from producing 100 podcast episodes

Growing an audience for a podcast is difficult; these tips will make it a little easier.

Want my hourly hot takes?

Every now and then I go off on mini rants on Twitter. For instance, here’s one where I respond to the perennial question, “Why is there no creator middle class?"