A Newsletter On And About Substack

It's The End Of An Era

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This ‘newsletter’ (it’s neither a ‘letter’ nor ‘news’) is made possible by a company called Substack. I believe that it sits at the vanguard of a new kind of business thinking that is not about ‘world domination’ and ‘scale at any cost’, but rather a focussed, deliberate move towards empowerment of people. In this case, allowing writers to write what they find interesting and readers to find those publications and read those thoughts.

And that is important because I also believe that it reflects a change in the industry of investigative journalism, opinion, commentary, and editorial, not mention ‘special and focussed interests’. Note - not ‘news’ that is an altogether different subject.

I read this short post recently, where the writer opined that Substack was great - but just wouldn’t be able to scale. I wrote to him, asking why he thought that;

"It wouldn't scale for individual journalists to leave their publications because the vast majority of readers can't pay them each separately for their work.”

I was far from convinced that he was right. I agree that they aren’t/can’t/won’t scale like say an Uber, but then I don’t think they are trying to ‘do an Uber’.

My Calculations

(I have used USA numbers only - to demonstrate the potential.)

IF 100 million people decided to spend $200 a year on newsletter subscriptions that equates to a $20,000,000,000 per year market.

If half that number of people spent one-quarter of that, it remains a $500 million a year market.

Compare that data to what is going on in the video streaming market place …

… seventy percent of U.S. households have at least one video subscription and the ‘average’ American subscriber watches 3.4 services. For each one, they pay an average $8.53 per month.

To bring it right down to the wire … 50 million people spending $5 a month means roughly one fifth of the people already using subscription services for TV spending an additonal 12% on newsletters.


Meanwhile, the US Bureau of Labor Statistics reports 44,100 people in the USA, that describe themselves as News Analysts, Reporters, and Journalists with a total income of around $2.7 billion. In other words, 50 million people spending $50 per year paying writers directly represents around 20% of all current salaries of those people.

This just based on 10 million people spending $50 per year. There is a lot of room for growth.

Admittedly, there are other costs to consider. For example, if you are on Substack - they will take a percentage of your earnings for running the service - and that is just the start. That said, the numbers still add up.

Will it replace the NYT and similar news sources? No, but that isn’t the focus of these writers. Nobody is arguing that Greenwald, Yglesias, and Sullivan are trying to replace the daily newspaper.

The Guardian, writing just at the end of last year;

“Glenn Greenwald, Matthew Yglesias and Andrew Sullivan, formerly of the Intercept, Vox Media and New York Magazine respectively, have all jumped ship to sell their work directly to subscribers via the service (Substack).”

It’s about focus - and no single writer needs a giant following and paid for subscriber base to make a living. And THAT is the point.

Schumaker's Small Is Beautiful: A Study of Economics As If People Mattered was published nearly fifty years ago. It seems it has taken us that long to start to deliver on the promise.

Consider Local News

In America, if you live outside of the large conurbations like NYC, SF Bay Area, Chicago, Dallas … say in a small town of 100 or 200 thousand people it is highly likely that your local newspaper (if it still exists) is a ‘shadow of its former self’. The fact is, if you were inclined to set up a ‘digital local news delivery service’, you would need just 1% of that population to pay $50 a year to generate a personal revenue stream of $50,000. Get the circulation up to 3% and you have enough to employ / partner with a second person.

I am serious. Watch this space. For example, related, not connected - but highly relevant, take this article; The Truth Is Paywalled But The Lies Are Free

But let us also notice something: the New York Times, the New Yorker, the Washington Post, the New Republic, New York, Harper’s, the New York Review of Books, the Financial Times, and the London Times all have paywalls. Breitbart, Fox News, the Daily Wire, the Federalist, the Washington Examiner, InfoWars: Free.
~ Nathan J. Robinson

I think we can all agree, ‘free’ is definitely not working.

This fits into another People First thesis ... free and giant is over. For the longest time since the Internet started the tech community has pushed free, growth at any cost, and build an advertising model-based business. This is new. This is different. This is the future.

More Links To Make You Think

Without Trust, Nothing Worthwhile Exists.

Think, you can’t read more than 2 or 3 newsletters a week?
Learn how Kushaan Shah reads 30-40 newsletters per week.

Substack isn’t a new model for journalism — it’s a very old one.

Is Substack the Media Future We Want?

Substack’s view of content moderation: Building a system that puts readers and writers in charge.

“By my conservative estimate based on public and private Substack figures, the $5 monthly subscriptions to participating in her (Heather Cox Richardson) comments section are on track to bring in more than a million dollars a year.”
~ New York Times

Think about that. Heather Cox Richardson, a relatively unknown Professor of 19th century American history at Boston College launched a FREE newsletter on Substack (you only pay if you want to comment), and is currently running a revenue rate of $1million per year.

Substack was founded in 2017 and launched in 2018. This newsletter launched its first (experimental) issue of this newsletter in February 2018. One famous newsletter writer NOT on Substack is Ben Thompson (Stratechery). According to this article they estimate that his newsletter generates about $3 million a year. Substack are on record that Thompson was one of the inspirations for them to build the service.

This while…

“around one in four papers in the country, most of them weeklies, have been shut down since 2004, the U.N.C. study found. In that same time span, roughly half of all newspaper jobs have been eliminated as the cumulative weekday circulation of print papers has fallen to 73 million from 122 million.”

What do they say?

As one door closes, another opens.

Talking about ‘The End Of An Era’, as I just appended to my first newsletterTime’s They Are A-Changing - and in more ways than one. This is the last newsletter in this format. It is a new year, time to ‘change it up’ and that’s what we are going to do. With the support of Substack - of course!

Look forward to seeing you next week … in the meantime … what do you think?

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My thanks and appreciation for your continued support, comments, and attention. Please like the postshare through your social channels and forward the email to colleagues, friends, and family that want to join us on this journey and do comment or email me your thoughts.