When news broke last week that Medium, the writer-friendly online publication, was laying off one-third of its staff (about 50 people), it wasn’t all that shocking. Online publications routinely shed jobs, retool, and refocus. Often they get acquired or close up shop altogether.
Medium is different in many ways from the typical online publication. It’s a place where any type of writer can express themselves. It's also often a venue for “influencers”—one of the buzzwords I love to hate—to bloviate, make corporate announcements, or advance what passes for a trend. Not all “influencer” posts on Medium are like that, but perhaps you know what I mean.
The layoffs essentially spell the end of Medium’s branded content business, “Promoted Stories.” The publication looked to that business to generate ad revenue. In this way, it was doing what most other publishers are: leaning on branded content to help prop up a broken advertising model.
In a blog post announcing the layoffs and reboot, Medium CEO Ev Williams reiterated what drove him to create the publication in the first place: “[I]t’s clear that the broken system is ad-driven media on the Internet. It simply doesn’t serve people. In fact, it’s not designed to. The vast majority of articles, videos, and other ‘content’ we all consume on a daily basis is paid for—directly or indirectly—by corporations who are funding it in order to advance their goals. And it is measured, amplified, and rewarded based on its ability to do that. Period. As a result, we get…well, what we get. And it’s getting worse.”
Williams' words bear repeating: The “broken system is ad-driven media.”
I agree. So what’s the way out—or through? Publishers certainly can’t rely solely on branded content to get them out of the hole. It may be award-winning and “engaging"—and in many cases, adds significantly to publishers' revenues. But Williams is going for something more here. He’s trying to figure out how to overhaul a moribund system and in so doing, incent writers who are sharing their ideas. He writes that writers “should be rewarded on their ability to enlighten and inform, not simply their ability to attract a few seconds of attention.”
It remains to be seen how Medium will create a new publishing and revenue-generating model. Of course paid subscriptions are one way to go. Publishers can also purchase “memberships” for readers on Medium. It's interesting, for example, that The New York Times actually saw the number of new subscriptions increase when it removed its paywall during the election.
The main point is this: Medium wants to reduce its dependence on digital advertising and branded content and come up with a new way to monetize. What that will be is unclear. The pact or value exchange between readers and publishers—that readers must accept some form of advertising or sponsored content in order to gain access to “free” content—is worn and frayed. New hybrid models are needed. Bravo to Williams for continuing the quest to find the right solution(s) for Medium.