Random Glimpses of the Future Media
Some things on my radar this week
Hey Everyone,
In this Newsletters I ask difficult questions and may seem obsessively critical. That’s just the default of how my minds works, so please bear that in mind.
Media Cuts
So the end of Buzzfeed News meant a 15% cut in staff, along with Insider doing its own 10% cut of media workers. Some of those even came to Substack.
Insider’s Matt Lynley is such an example. His about page is very professional.
Censorship
Regulation is coming to the internet and A.I. Some of the rules are a hodgepodge of country by country and region by region. Canada and the EU are such examples.
Via LinkedIn News: A controversial federal bill regulating online content has become law after clearing the Senate on Thursday, ending nearly 18 months of debate. The Online Streaming Act, or Bill C-11, was introduced last year to modernize broadcasting laws, requiring streaming services such as Netflix, Disney Plus and Spotify to contribute to the “creation, production and presentation” of Canadian TV and film content, just like traditional television and radio broadcasters in Canada. YouTube and Spotify will also be required to promote Canadian content. Critics said the bill gave the CRTC too much control over the content Canadians watch, or in some cases post, online.
I’ve enjoyed reading some Substack authors who have been critical of this Bill. It appears to have some elements of state media censorship. And BigTech are threatening all kinds of retaliation.
TilTok A.I. Avatars
TikTok’s looking to integrate its own set of generative AI tools, with a new profile image generator currently in testing at the app.
E.U. AI Act
Via Venturebeat: After months of negotiations and two years after draft rules were proposed, EU lawmakers have reached an agreement and passed a draft of the Artificial Intelligence (AI) Act, which would be the first set of comprehensive laws related to AI regulation. The next stage is called the trilogue, when EU lawmakers and member states will negotiate the final details of the bill.
According to a report, the members of the European Parliament (MEPs) confirmed previous proposals to put stricter obligations on foundation models, a subcategory of “General Purpose AI” that includes tools such as ChatGPT.
There is literally a “substack for that”.
beehiiv launches “Boosts”
This is a weird marketplace where you can buy and sell Email subscribers. Even the description about the product didn’t make a whole lot of sense to me.
The headline was “Your Newsletter on Drugs”. I cannot help but feel beehiiv vs. Subtack has become a race to the bottom on audience hijacking. Pop-ups and Notes filling our inboxes with spam is a good reading experience?
Behiiv getting into a wallet and marketplace is innovative, if potentially very sketchy. I’ve seen Newsletters growth their at rates that make me feel a lot of black-hat things going on. This happens when you have an Ad-Network you need to scale.
Paid recommendations eh? Golly sounds expensive a.f. How much of a cut does the house get again? Boosts are only available to users on the Scale plan. Scale is $84 a month, sounds like pay to win.
Still its worth taking some time to understand how this enables Newsletters with huge followings to monetize more easily with a new passive income stream.
Meta, A.I. and the WhatsApp Super App Creator Experience
Meta is now also hyping A.I. and how transformative it has been for engagement and Ads on its Earnings call. Meta’s stock is up 17% because of it. This means I expect big things from WhatsApp in the form of more innovation with Generative A.I. and a potential SMS based “Newsletter” competitor.
I’ve been mentioned this in the past but it now seems far more likely. Meta’s first-quarter sales rose 3% from $27.91 billion a year earlier, after three straight periods in which revenue declined. While the advertising slowdown is still pretty slow, they have a window now to leverage A.I. in new ways.
Restructuring at Meta has been expensive with aggressive layoffs. But hyping A.I. instead of the Metaverse seem to be the formula to take. WhatsApp as an SMS channel for Creators in the near future is highly likely, with open-rates far higher than Email.
Advertising has not rebounded as some claim, it’s pretty flat. Meanwhile TikTok is so well diversified in apps, it’s impossible for Facebook to really catch them. There is an argument now that with Lemon8 it’s “pointless” to ban TikTok. Nothing is ever pointless when it comes to National security. Snap continues to fail at advertising and its new A.I. product seems to be controversial. It’s normalizing chatbots in GenZ society.
I have been a fierce supporter of Substack Notes since it’s launch on April 11th. But the data is not sending home great messages for me. And I’ll tell you exactly why I feel this way.
Substack
Substack is testing a number of new features. Notes has led to more recommendations and more inboxes full of spam. Creators referrals aren’t a great way for a company to do app marketing, as we are seeing.
Substack is including among other things CTAs in the footer to drive app signups. It’s not working. Notes is the not party I’m going to have on Blusky Social. But what to do? Substack has a limited budget for all things sales and marketing, while Substack Pro means they seem to think investing in “well-known” writers it optimal for network growth.
The strategy gave them some growth in the past so they rinse and repeat. But their relationship to Twitter already signals a different internet. Some of the moves they are doing now appear to be reactionary. Substack’s ability to pivot to real-world circumstances is making me wonder about the flexibility of leadership and out-of-the-box innovation here.
For example on my flagship Newsletter I improved recommendation efficiency due to Notes in April, 2023, but at what cost to diluting my potential audience? More free readers from this Network is not optimal to my niche targeting. In the case of conversions, it has likely been more negative than positive. Any platform can pad our Email list size, I’ve experienced that with LinkedIn before.
After their pilot (LinkedIn Pulse) I immediately had over 200,000 subscribers. But as always, it depends on the quality of those readers. Social media has been faking KPIs and vanity metrics for a long time, but does it actually improve the health of the Subscription Network? Is Notes improving monetization for your Newsletter? If the product keeps veering in weird directions on Notes, I may have to temporarily opt out.
To combat this peer-to-peer madness (“Sugar-daddy inboxing”), I’ve been recommending more Newsletters in my niche of A.I. and the software engineer audience. But smaller niches on Substack will not be so lucky to have enough peers in that domain to make their recommendations more targeted. Conversions via sign-up recommendations remains relatively poor to paid subscribers. This leads to an overreliance on Substack’s Network that might actually inhibit long-term growth of some Newsletters.
The one thing that matters for Email list size is getting into flat-fee short Sponsored Ads. After testing out dozens of them the one I have ended up using is called Paved. The problem? They take 30% of the fee. Substack turning a blind eye to these sorts of Ads is frustrating because I definately do not want to enter the realm of cost per click and affiliate ads were I find very lame.
My Take
But if the paid subscriptions don’t scale better to enable me to have a living wage, I’ll need to focus more on external Ads and brand partnerships. The peer-to-peer recommendations are only an ice-breaker for the growth of my Newsletter.
If Substack focuses any more on app conversions in the Newsletter and the direct consumer relationship I am assured I own, it might break the relationship with many creators. Those CTAs have too low a click through rate to justify this CTA spam, that takes agency from the Creator to the platform.
Notes Launched on April 11th, 2023
Notes has been a fun experiment. But if I look at it from a business perspective of ROI, it’s been more of a distraction than an avenue for paid subs for me. These are good people but they are not MY people, this Substack network simply does not have many of the sorts of readers who would find my work interested (across all of my Newsletters).
If I could press a button and deselect all the readers of my Newsletters who are writers on Substack, I would. (not counting this Newsletter of course which is more for Substack writers than anyone else).
Substack is reminding me that to rely too much on a platform is a bad idea, and not in a good way. Platforms have biases, their own incentives which might hurt me, editorial bias and lots of other levers and echo chamber dynamics that could work against me. That some of the product features contradict Substack’s ideological narrative really annoys me. Many of the product-features take ownership away from me the Creator. This harms trust.
So I need to hunt externally again for traffic from better networks for my audience (Technology category is too immature still on Substack).
I feel like there are Creator nuances the employees at Substack don’t fully comprehend. (they think they do but they don’t).
They are getting a bit cocky when it comes to product releases and not taking the time to understand the Creator viewpoints. When an app or platform thinks they “know best” it’s a rad flag for me. I’ve seen this too many times as a Creator.
But you always have to be customer centric, whether that’s Creators or the actual readers themselves.
Notes in this sense could have some pretty severe negative side effects. Instead of forcing Creators and readers to follow your product timeline, you need an actual match the product with the market at large.
While I have done all I can personally to support Notes with my time and effort, the data I’m getting for my own Newsletter does not match this investment. The honeymoon phase for me is fading. So I’m going to use Notes tentatively moving forwards for niche discovery.
My Free Readers since Notes
Unfortunately this bump in traffic did not substantial correlate with many more paid subscriptions than normal. It leads me to reconsider the value of having a P2P audience at all.
Thanks for reading!