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March 14, 2022, 9:17 a.m.

Substack’s new platform play

The company has an iOS app and big new ambitions. Should writers be scared?

Let’s talk about Substack’s new reading app, and the moment in the life of a young tech company when its ambitions grow from niche service provider to a giant global platform. Platformer, from which this post is republished, is hosted on Substack; see my ethics disclosure.)

For the company’s first five years, writers using Substack have published in two places: on the web and via email. As of last week, there is a third place: an iOS app that allows you read everyone you subscribe to on the platform — as well as any other RSS feeds you care to add — in a dedicated spot on your phone or tablet.

“We’ve kind of wanted to do this forever,” Chris Best, Substack’s co-founder and CEO, told me in a recent interview. The app was built by a team nostalgic for the halcyon days of Google Reader, he said, with its hand-curated feeds and limited social features. The team also wanted to enable features that simply aren’t possible in email: background podcast listening; video embeds; comment threads updated in real time.

“There’s a place you can go that’s not like a giant slot machine, trying to appeal to your worst self,” Best said, “but instead is a place where you go to spend time with the people you’ve chosen to spend time with, and that you think make your life better.”

When I installed a beta version of the Substack app last week, I was struck by the effort the company is making to get you to use its app by default. When you sign in to your account, the first thing the app does is ask if you want to “pause” all email notifications from the publications to which you subscribe. It looks like this, and is switched on by default:

Best told me there were practical considerations for this design choice. Many people enable notifications for both Substack and email, and receiving duplicate notifications might be frustrating. But the company also believes in the superiority of the app as a place to read.

“Email is great for all of the reasons it has always been great,” Best said. “It’s low friction. It’s this direct connection where you can reach out, unmediated by the algorithm. But it’s obviously not the best version of that reading experience.”

The ideal Substack app, he said, is “like Google Reader and your email inbox had a baby that’s more attractive than either of its parents.”

I wince at some of the language in the Substack app; I’d never send out a newsletter if I thought it was something your email inbox should be “spared” from. For my favorite newsletters, the reverse is true. My email inbox consists mostly of things I did not ask to receive; when one of my favorite newsletters shows up there, then, I get excited.

Of course, I’ve also gone overboard. I subscribe to 50 newsletters on Substack alone, 12 of which I pay for. More newsletters roll in each day from Ben Thompson, Matt Levine, The New York Times, The Verge, Twitter’s Revue, Facebook’s Bulletin, and The Atlantic. In the end, I created my own sort of Substack reader app using Gmail filters: automatically labeling most of them and moving them to a dedicated tab, which I read at my leisure.

Using the Substack app, and talking with Best, highlighted for me the different interests of readers, writers, and Substack itself. In them, I think, there are some lessons about what the next wave in media could look like. (The situation is also changing quickly: a day after I originally wrote this post, Substack backtracked on its move to default readers away from receiving emails from publications they subscribe to. In the next version, readers will be able to switch emails off in the app’s settings, but won’t be asked to when they first install it.)

Readers want smart journalism, commentary, and entertainment delivered to them directly, by trusted and singular voices. They want niche coverage of important but under-covered phenomena. Increasingly, they are willing to pay for it.

Readers attach different significance to different publications, and will read them accordingly. When Stratechery arrives in my inbox each morning, or Today in Tabs around lunchtime, my brain treats the situation as an emergency, and I almost always set aside whatever I’m doing to read them in full. Other publications I might choose to read hours or days later, when I’m in less of a work mindset. The former set of publications I always want to find in my inbox; the latter I’m probably happy to read in an app.

Readers also like other media formats: podcasts, video, comment threads, and whatever else people are charging for on Patreon. These are experiences that can’t be delivered over email, and so readers seek them out elsewhere. An app can do that for them.

Writers want to build sturdy, growing, independent businesses that reach their audiences directly. The past decade saw publications lose huge audiences once people began getting their news from Facebook, Twitter, YouTube, and TikTok. Email-based businesses allowed writers to rebuild those connections once again, in ways that (so far) have been harder for platforms to thwart.

Writers want readers to think of their publications as distinctive and valuable, rather than generic and commoditized. (Think: the difference between saying “I am the editor in chief of the magazine” and “I have an account on Medium.”) It is possible that a successful Substack app could help writers build growing businesses by building features that advertise their publications to likely readers; the company says that a person who has a credit card on file with Substack is 2.5 times more likely to subscribe to a new publication than someone who hasn’t. But it is equally possible that an app makes publications feel like cheap, interchangeable widgets: an endless pile of things to subscribe to, overwhelming readers with sheer volume.

That brings us neatly to what Substack wants, which is for as many people as possible to subscribe to as many newsletters as possible. Substack’s model is to take 10% of revenue from paid publications, and in November it announced it had just hit 1 million paying subscribers. The company has raised venture capital at a valuation of $650 million, and to justify it, Substack needs to dramatically increase the pool of subscription revenue it is taking from. The most effective way to do that is to find people who already pay for one newsletter and suggest that they subscribe to lots more newsletters.

Substack also needs to keep writers on its platform, despite the perverse nature of its price structure: The better a writer does on Substack, the more expensive it is to remain there. (That’s also true of Twitter-owned Revue, though it charges just 5% of revenue. Ghost, an open-source alternative, charges a monthly fee but does not take a cut of revenue.) Substack’s approach has already led to several high-profile departures, though another big publication — the leftist politics blog Discourse — recently returned.

Lots of people have asked the Substack founders about their weird pricing over the years, and their answer has stayed the same: essentially, that “We will make you so much money that you won’t even care about the 10%.” This argument has proven surprisingly persuasive, I think, for a few reasons. One, the power of inertia is strong — most writers aren’t technically adept, and even if they are, who has the energy to move an entire business? Two, when Substack works, it really works: lots of writers here are making more money than they ever did working in mainstream media, and as long as their paid subscription numbers are going up, they have little real reason to complain. (Also, when Substack doesn’t work, the difference between 5 and 10% of revenue may not be enough to care about.)

The Substack app, then, is an effort to both attract and retain writers by bringing the power of software to the problem that they and Substack both share: the need to find and convert more paying subscribers, using whatever levers they can dream up. Recently, Substack has introduced free trials; added templates for sales and other promotions; and tested banners that appear after you subscribe to one publication asking if you would like to subscribe to four or five more. The app is another experiment in this direction.

If you’re an optimist, you can sort through all these motivations and see a world where everyone gets what they want: readers can choose which publications they want to receive in their inbox and which in an app; writers get to maintain their independent businesses but grow them more quickly; Substack adds revenue quickly enough to keep the VC jackals at bay.

But if you’re a pessimist, this vision can all fall apart rather easily. Platforms act in their own interests first, and almost always exert more pressure and control on creators over time. The more slowly a platform grows, the more true this can be.

In our conversation, Best joked that an “evil Substack” might have developed an app that opened not to your chosen newsletters but to the most viral posts of the day: Substack reimagined as the YouTube home page. It’s easy to imagine other things Evil Substack could do, but I won’t tempt fate by writing them down.

In some sense, a Substack app was inevitable. It is in the nature of media to break apart and then come together again in regular cycles, and here we see a clear beginning to a new period of bundling. We won’t know for some time who benefits, and who doesn’t.

If the Substack app flops, or is a moderate hit, I don’t imagine it will change much for readers or writers. Over time, though, and especially if it succeeds, it could shift the power balance away from readers and writers to the platform itself. The last time that happened, we got Facebook and Twitter, where it was more or less impossible for writers to make a living.

Should Substack someday find itself in a similar position, there’s reason to hope it will make for a better landlord. But after the past decade spent working on other people’s platforms, writers have every reason to be skeptical.

Casey Newton is the editor-in-chief of Platformer, which you can subscribe to here.

Photo by Substack.

POSTED     March 14, 2022, 9:17 a.m.
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