Burned once, publishers are wary of Medium's new subscription offering
Late last summer, Kelley Calkins and her team began discussions with Medium to take their burgeoning company in a new direction.
The Establishment, a scrappy, four-person outlet funded and run by women, was considering moving its site to Medium. Taking the plunge would mean free hosting, access to the company's minimalist content management system and a variety of business opportunities.
And more money. The Establishment, like other publishers, inked a deal with Medium that guaranteed the site a healthy stream of revenue based on the amount of traffic to the site. That amount, which was negotiated individually with each publisher, varied: One publisher interviewed for this article said it was just under $3 per thousand pageviews. Still, Calkins said, she raised questions about Medium's commitment to publishers during meetings with the company's team.
"I remember raising the issue," said Calkins, a cofounder of the site. "Medium has pivoted a bunch. What are you guys? And are you going to be doing what you say you're doing now in perpetuity?"
A representative from Medium assured her the company's intentions were good. They'd brought aboard marquee names like The Ringer and ThinkProgress. They'd migrated thousands of stories to Medium. They wouldn't have done that if they weren't committed to supporting publishers, Calkins recalled being told.
Then, on Jan. 4, Medium CEO Ev Williams pivoted. Decrying advertising-based publishing as "a broken system," he laid off 50 employees, including several that worked with publishers. Publishers could still sell their own ads and make money via membership, but gone were revenue guarantees from Medium's native advertising deals, which some publishers were banking on to keep them afloat.
The announcement came over "literally as we were switching over our URLs" to Medium," Calkins said.
“Initially, it was a lot of swearing," she said. "Then came the tears. And the cheap beer."
This week, two months after denouncing web advertising, Williams unveiled Medium's new plan to monetize content: A subscription service for $5 per month that gives contributors an improved reading experience, exclusive stories and a "personal, offline reading list." The initiative includes a partner program whereby publishers can pitch stories to Medium that the company will fund on a per-story basis. For publishers who were relying on Medium's revenue beta, the partner program represents a potential new revenue stream. But some interviewed for this article say it won't be enough to pay their bills.
"Right now, we're very concerned about the future of our site's partnership with Medium," said Neil Miller, the founder of pop culture site Film School Rejects. "What we were sold when we joined their platform is very different from what they're offering as a way forward."
"It's almost as if Ev Williams wasn't concerned that he was pulling out the rug from underneath publishers who had placed their trust in his vision for the future of journalism," he said.
Medium, which sold publishers on being a home for quality journalism, is now putting the sites it recruited in jeopardy, Miller said.
"I sincerely hope it works out, but at this point there's a lot of uncertainty in the viability of Medium as a platform for independent publishers," he said. "We'd love to stay with them on this journey, but I worry that it will be impossible without significantly damaging our ability to operate our business."
Medium declined to comment for this article.
Ben Wolford, the founder of the online social justice magazine Latterly, expressed similar concerns. He said he'll use the program but has set up some contingencies.
"Obviously, I don't see selling articles to Medium as a sustainable business model for Latterly," he said. "And as of December we've been setting up a buffer between Medium's business and our own by selling subscriptions on a separate, non-Medium site. That said, we're glad they're willing to pay for and promote our journalism, and we plan to pitch stories."
The Establishment has also begun hustling to come up with new revenue streams. After the announcement, Calkins and her team began a fundraising campaign that has so far brought in $25,000. They've seen some success from Medium's membership feature, and they're selling merchandise to help defray costs. But they've still had to cut back their publication frequency and make significant spending cuts.
Readers can also sponsor individual stories — kind of like naming a star in someone's honor, Calkins said. The team is working to raise $75,000 so they can be admitted to an accelerator that will help them figure out a way forward.
She noted that January's pivot sent the company into "recalibration mode," but the initial upsides to joining Medium remain — increased readership, higher engagement, access to a membership community. It's just become more difficult to find funding.
"Maybe the takeaway is, 'don't trust Medium, ever,'" Calkins said. "But there are only so many things you can account for at a tiny baby startup that is trying to navigate this intimidating media landscape.'
Not every publisher was totally disillusioned by Medium's pivot. Sunil Rajaraman, CEO of The Bold Italic, said his experience as a media entrepreneur taught him that digital advertising is notoriously difficult to pull off. Companies often promise lots of inventory and high clickthrough rates, but selling advertising online is getting increasingly difficult.
"We've never viewed the Medium equation as, 'oh yeah, they're going to sell a bunch of inventory on our behalf and everything is going to be dandy,'" Rajaraman said.
He also noted that Medium is still covering costs for publishers, including hosting, content management and site maintenance. He's signed up for Medium's partner program, but The Bold Italic never depended entirely on Medium's revenue beta.
"There is no free lunch in media," Rajaraman said. "Selling ads is getting harder and harder. So by outsourcing it to Medium and Google — sure, you're putting the responsibility on someone else, but then they have to deliver."