Insiders see more paywalls, fewer small publications, and the continued rise of omni-channel distribution in the future for media. This comes after years of declining trust in media outlets and increased scrutiny by advertisers. The media landscape is about to change dramatically over the next couple of years.
I recently had the opportunity to participate in several media roundtables as part of the 2021 Collision Conference. Media giants like The Wall Street Journal, Washington Post, Forbes, and VentureBeat spoke alongside niche publications and independent journalists. It was fascinating and reaffirming to listen to them all talk about the various challenges and disruptions faced by the media industry.
Below are some of the most interesting topics that were discussed.
More paywalls
There was general disdain for paywalls by most of the roundtable participants. Most media insiders want as many people as possible to consume their content. Asking people to subscribe before they can do that is a massive barrier.
However, there was agreement that paywalls are necessary, especially for larger publications, and there is mounting pressure to implement them. I used to believe that publications that adopted the subscriber model did it because it was more lucrative than the traditional ad-supported model. I learned, that this isn’t always the case. In fact, the push to a subscriber model was more about the type of revenue than the amount of revenue.
It became clear from the roundtables that media outlets are no different than startups and SaaS companies – investors and stakeholders want to see predictable revenue streams. The traditional advertising model is unpredictable and “lumpy”. Subscribers, on the other hand, provide regular recurring revenue. Because of this preference by investors, expect more publications to switch to the subscriber model in the years ahead.
More Advertiser Scrutiny
The political and social upheaval that has happened over the past 5 years has made advertisers hyper-sensitive to how their brand is perceived by the public. Significant revenue and reputation can be lost if a company’s ad is seen on a publication that writes stories that are counter to that company’s values.
The participants in the Collision roundtable were unanimous that the threat of losing an advertiser should never influence whether a story is published or not. However, some admitted that this may indeed be happening quietly behind-the-scenes as some publishers struggle financially.
Omni-Channel Distribution
“To be a successful media outlet or journalist today, you can’t restrict yourself to just one medium,” said one roundtable participant. “You have to be omni-channel.”
TV outlets have websites and YouTube channels where people can watch their video content. Those same outlets use Facebook, LinkedIn and other social media platforms to drive traffic to their content. Forward-thinking media companies are already adopting new platforms like TikTok and even Clubhouse to distribute their content.
Fewer Small Publications
The looming changes to online advertising networks due to the ending of support for third-party cookies (more on that in a separate article), means smaller publishers will see declining revenues.
Many solo bloggers, for example, do not have the bandwidth or skills to sell advertising directly to companies. Instead, they place ads on their sites that come from big ad networks. Whenever someone clicks those ads and makes a purchase, the blogger’s site gets a piece of that transaction.
People are more likely to buy something that they are already interested in. This is why ad networks use third-party cookies to track your web behavior and serve you product ads from sites you have visited. Called “retargeting”, this technology is responsible for why you keep seeing ads for a toaster oven after you visit the toaster oven page of a manufacturer you were researching.
By 2022, Google (Chrome) will join Apple (Safari) and Mozilla (Firefox) in ending support for third-party cookies. This change will make ad networks less effective, which means less people clicking on ads, which means less affiliate revenues for small publishers. The drop in revenue may be significant enough to force smaller publishers to close.
Continued Rise of Substack
As more traditional media outlets trim their newsrooms and as editorial pressure mounts on journalists to conform, more are turning to Substack as an alternative way to make a living. Substack removes the publisher from the equation and provides tools for journalists to build their own readership directly. Readers pay a fee to subscribe to that journalist’s newsletter and the bulk of that subscription fee goes to the writer, not a publisher that sits in between.
Some roundtable participants saw Substack as nothing more than a temporary way-station for journalists transitioning between media outlets. Others saw the platform as a side-hussle. A few saw Substack as a potential disruptor to traditional media outlets. They warned that Substack removes an intermediary, the media outlet/publisher, and that the Internet has rewarded companies that disintermediate.
All agreed that the use of Substack will continue to increase in the coming years.
What does this all mean for Healthcare publications?
Most healthcare media outlets, including Healthcare IT Today, are not dependent on affiliate revenue, so I doubt many will be closing doors because of the ending of support for third-party cookies. As well, healthcare publications are not extreme in their editorial content. We all tend to be very factual and avoid politicizing the issues we face as an industry. I cannot see many advertisers pulling their support for over brand concerns.
However, I do believe we will see more healthcare publications move to a subscriber model – the lure of recurring revenue is simply too hard to resist. Don’t worry, that’s not something Healthcare IT Today has even talked about.
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