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How Long Can the Newsletter Boom Last Before the Bubble Bursts?

By Kayleigh Donaldson | Miscellaneous | July 8, 2021 |

By Kayleigh Donaldson | Miscellaneous | July 8, 2021 |


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Do you have a newsletter? I have a newsletter. So do many of my friends, colleagues, and people whose work I appreciate and follow. There’s nothing new about this model of communication. The chances are your email account is currently polluted by brand promotions and regular updates from sites you clicked on once or two and always forget to unsubscribe from. Yet it’s tough to deny that, especially over the past year or so, newsletters have gotten big.

Various platforms like Substack and Letterdrop are competing for your company, with the former notoriously dropping big bucks on securing exclusivity deals with some of modern media’s most notable writers. Substack offered six-figure advances to the likes of Matt Yglesias and Danny Lavery to make the site their creative home. It didn’t take long for a slew of big names in this tight-knit industry to jump ship, with the likes of Matt Taibbi and Andrew Sullivan going to Substack, where they are reportedly pulling in huge profits with the platform’s paid subscription model. Traditional media is scrambling to keep up. The New York Times announced earlier this year that editor Choire Sicha would move from the Styles section to a new project related to newsletter expansion. Twitter bought Revue, a ‘service that makes it free and easy for anyone to start and publish editorial newsletters.’ Even Facebook is now in the newsletter game with Bulletin, where you can subscribe to the likes of Erin Andrews, Mitch Albom, and Tan France.

In an interview with the journalist — and Substack writer — Casey Newton, Mark Zuckerberg heralded newsletters and the paid subscription model as a sign of a bright new future for creators, one where they are liberated from traditional media. Coming from the man whose lies over the value of pivoting to video on his own site irrevocably destroyed huge swaths of traditional and online media, it’s a pretty f**king rich claim to make. It also overlooks how much this bubble is dependent on venture capitalist money and the same rules of profit above all else that have smothered the worlds of newspapers, magazines, and websites, independent or otherwise. Substack’s biggest investors are the venture capital firm Andreessen Horowitz, and a recent round of funding brought in around $65 million. According to Axios, this ‘would value the company at around $650 million.’ And I doubt Facebook put together Bulletin out of the goodness of their own hearts. It’s an interesting future for venture bros to bank on, one where big names in media write unfiltered pieces to their adoring fans, and the concepts of fact-checkers, editors, and any sort of guiding hand are tossed aside. It certainly narrows down who serves to profit from this system: the writer makes bank, and the platform takes their cut.

Substack has spent a lot of time justifying why they offered big cash advances to certain writers. Hamish McKenzie, the company’s co-founder, explained that these deals ‘gives financially constrained writers the ability to start building a sustainable enterprise. We take most of the risk for them. In return, their work contributes to the quality of the Substack ecosystem, and they become long-term customers.’ It sounds like a dream come true. Staff gigs are rarer than gold dust in media these days, and the possibility of long-term security is almost a delusion. Why not take the six-figure sum, write what you want, and let Substack take their cut? But who is considered worthy of such a deal? Substack has trouble understanding that they are as much a publisher as they are a platform.

Much has already been made about Substack’s seeming unwillingness to clamp down on transphobia on their site. Former TV writer Graham Linehan, a transphobe so abhorrent that Twitter of all places banned him, is on Substack. He seems to spend most of his time smearing trans women as sex offenders. Substack claims it merely offers a platform for free speech and the like, but that ignores the curation and funding they do. You can’t claim you’re hands-off on these matters when you’re offering six-figure cheques to certain people over others. Writer Jude Doyle chose to leave Substack in protest to this problem, writing, ‘As for me, I’m out. Substack has the right to pay whomever it wants, but it doesn’t have the right to earn money for bad decisions, nor does it have the right to profit off my name, credibility, or work.’

As an individual, these platforms are all that you make of them, and there are no limits on who can participate and why. The dominance of Joe Rogan’s podcast doesn’t mean you’re not able to record your own show from your living room with a mic you got from eBay. The same goes for newsletters (and sites like Patreon, which allow for a more direct relationship between fan and creator.) Such platforms offer a kind of specificity and creative freedom that can be liberating, especially at a time when we still live in the smothering uncertainty of an industry with no financial safety net and the tyranny of the almighty algorithm. I set up my own newsletter as a fun project I could have total control over, but I can’t claim I didn’t do it with at least some eye towards one day making it profitable. The same goes for literally every podcast project I’ve helmed. When you’re engineered to view every aspect of your life as a potential side-hustle (hi, fellow millennials), why wouldn’t you look at Substack and think about giving it a shot? At least get your foot in the door before the bubble bursts.

And it will burst, make no mistake about it. Indeed, it already seems to be leaning over a precarious edge. Writer Annalee Newitz told her Substack audience that the company is a ‘scam’, with their funding of big-name writers a handy way of making their company seem more lucrative than it is. Can they ever earn back those advances? And if not, how does Substack fill in that black hole, especially if those writers they funded for their first year decide it’s more beneficial to go solo after their obligations are complete?

Casey Newton told the New York Times that Substack had become a target for ‘a lot of people to project their anxieties.’ That’s not an unfair conclusion to come to. Hell, everything in this business is essentially a screen for projecting our panic. Still, the newsletter boom seems to be perched atop an especially shaky foundation, one that exposes a lot of the issues of Silicon Valley trying to reinvent the wheel that is journalism. These endless attempts to ‘disrupt’ the status quo often reinforce it. The podcast market promised a democratizing of dialogue, yet all the major deals still go to famous white dudes. OnlyFans offered freedom and a level of protection to sex workers, but the influx of celebrities may put that at risk. YouTube plays up its status as a kingmaker and creative hub for the world yet its algorithm stifles creators and rewards the absolute f**king worst human beings. Who is the power shifting towards in the great Newsletter boom, and who will be hurt the most when the bubble is popped? At least when some Silicon Valley douche-bro CEO buys out a website to gut of its worth, they’re obliged to pay off the staff. Substack doesn’t consider its writers to be employees. Where will they go if the platform implodes?

The newsletter era won’t solve the deeply embedded problems with modern media and its absolute screwing over of the people who create it. Union busting still happens at a terrifying rate. Freelancers struggle to eke out a living in a business dominated by SEO worship and undercutting writers. The near-mythic idea of creative independence seems pathetically at odds with the realities of wage disparities, increasing rent prices, and a lack of investment in journalism (especially at a time when it’s the target of such dangerous ire in the aftermath of the Trump administration.) Pivoting to video was supposed to buoy the sinking ship but it only exacerbated the problem (really, it created a whole new problem that never existed before, thanks a f**king lot, Zuckerberg.) So many of these platforms offer the world but no transparency to back it up to those tempted by the fantasy. How does Substack differ from traditional media when it seems dead set on replicating its worst recesses, albeit without the structural benefits of a publisher? It’s not as though Silicon Valley has ever shown an ability to learn from its past mistakes.

For now, the big newsletters seem to be doing well, or at least they’re skilled in maintaining such an illusion. Facebook is bolstering its new platform with familiar celebrities while Substack hopes the media’s most memorable names will bring them an air of commercial and creative legitimacy. And through it all, writers are just trying to get paid. I suppose we should enjoy it while it lasts and is replaced by the next hot new thing that will forever disrupt modern media. My money’s on zines.

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Kayleigh is a features writer and editor for Pajiba. You can follow her on Twitter or listen to her podcast, The Hollywood Read.



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