Beyond the ad? Three media experts discuss revenue models
Medium has been empowering anyone and any company to tell stories since 2011. With a total of $132 million in funding, it’s been a darling of new media, with accessible, simple and high-quality content. Yet despite notable success, Medium laid off 50 employees at the start of the year because its business model wasn’t making money.
In response to the layoffs, Ev Williams told Re/code, “We are shifting our resources and attention to defining a new model for writers and creators to be rewarded, based on the value they’re creating for people.”
At The Signal, we met with several product leaders to ask, Is our economy moving away from an ad-based revenue models? Is tomorrow a subscription-based economy only for creatives and consumers? Or is there another way to compensate creative work on the internet?
You can find a preview below of that conversation below:
The panel:
- Hunter Walk, co-founder and venture capitalist of Homebrew, seed stage investor for theSkimm, former product leader at YouTube and Linden Labs (creator of Second Life)
- Ellen Chisa, product leader at Lola, former PM at Kickstarter
- Nick Rockwell, Chief Technology Officer at The New York Times
Q: What sort of shift do you expect to see from media companies and social networks across the internet when it comes to their business models?
Hunter Walk: Here are a few of my predictions:
- The increase in recognition that creators need to get paid. Vine, for example, should have focused on this earlier and I’d be surprised if Instagram isn’t also thinking about this question.
- More ways for “true fans” to support their creators directly — subscription newsletters, branded commerce, Patreon-like sponsorship and crowdfunding. Even altcoins!
- Creator burnout and platforms coming up with ways to help address not just the monetary side of being a creator, but the emotional side. YouTube thinks about this in terms of creating community among creators, running education events, recognizing creator success through trophies for hitting different levels of subscriber-based and so on.
Ellen Chisa: I’m hoping for better discovery. Right now it can be easy to find the big names that are already popular on media platforms, or to find the people that you already know. There’s not much in the middle for niche creators — that same gap that I see in the business model. I’m not sure this is a “prediction” as much as it is a hope. I think landing that would help increase engagement (and advertising dollars) and create another space that people would be willing to pay for.
Nick Rockwell: Social networks are doing fine — advertising is working for them and charging for service can be very dangerous in those cases. For media, I think their business models will change more and more toward subscriptions, and lots of attempts to bundle up and aggregate subscriptions.
Read the full article here.
