The subscriptionization of everything: Why it's time for publishers to get intimate with their audiences
Byliner and Atavist are the latest purveyors of fine media to add a subscription element to their business models. They won't be the last.
The old-fashioned subscription model that dates back to the paper-and-ink age is making a comeback. In fact, the more new media evolves, the more it starts to look like old media.
Every digital media vertical now has a strong subscription player in it. For watching movies at home, we've got Netflix. For going to the movies, we have MoviePass (not a digital vertical, but enabled by digital means, an app). For music, there's Spotify. Apple is reportedly working on a subscription-based music streaming service, which it likely hopes will help save iTunes, now so clunky that PandoDaily contributor Farhad Manjoo has charitably suggested it should be put out of its misery.
For magazines, there's Apple's Newsstand and Next Issue. For books, Oyster is on its way. Hey, PandoDaily is even offering subscriptions for our events (and it's a totally worthwhile deal, people, so click the hell out of that link).
Part of this trend is driven by economics. For quality media with a semi-long shelflife that can't wholly be supported by page-view-driven advertising – as none of the above can, or desire to – subscriptions provide much-needed pennies. They're also good for providing consumer data, which can be directly or indirectly exchanged or mined for more pennies. Marco Arment has figured out that he can charge $3 a month for The Magazine and make it a viable enterprise. Spotify is neutering piracy by offering a quality all-you-can-eat service that is cheap enough to make illegal downloads less appealing.
For publishers like Atavist and Byliner, subscriptions might not pull in more dollars per reader per unit, but they potentially build a more reliable, regular readership and ensure a steadier flow of dollars. If they get the price right, it might also attract a broader audience, appealing to people who might otherwise forget to seek out the content every month, or neglect their email alerts or push notifications.
But there are other forces at play, too.
One factor is that people are becoming more comfortable with the idea of not owning something as long as they know they will always have access to it. Hence, Spotify over iTunes. Hence, streaming over downloads. Hence, Netflix over DVD libraries. These are not durable goods you use over and over again, or clothes you wear week in and week out. They're jolts of entertainment, and they go out of fashion quickly. Subscriptions provide an efficient and friction-light way of delivering those jolts to the system.
Another issue is that the subscription is very personal. It says something about a person, as well as letting that person say something about themselves. Paying for a subscription is not merely a straight swap of money for goods, it's an investment in one's relationship with a media brand; a sign that a consumer trusts the quality of content that brand delivers.
Why does that matter? Because we are increasingly consuming media on our smartphones and tablets. Soon, we'll likely be watching more video on our mobile devices than on our TVs; reading more books on them than in actual books; and chewing through more news and magazine stories than we would on the desktop-mediated Web (forget about dead trees). Our mobile devices, meanwhile, play nicely with the idea of subscriptions. They, too, are intensely personal. They say something about us, as well as letting us say something about ourselves. Are you an iPhone or an Android? Kindle Fire, or iPad mini?
It makes sense for us to "go steady" on these devices with our most trusted media brands. With mobile, there is less distance between the individual, the device, and the content. Everything moves together.
Subscriptionization is also the natural corollary to atomization. As media content is increasingly pried away from bundles, broken into pieces, and dispersed across the Web through social and "dark social" means, there also arises a counter opportunity for consolidation. Yes, serendipitous discovery is an excellent supplement to our media diet. But it's good to have a strong base, too. Subscriptions provide that base. For instance, I subscribe to the New York Times for general news, The Magazine for long technology reads, Netflix for movies, NextDraft for suggested daily reading material (although that's free), Spotify for music, and as soon as Oyster launches, I'll be all over that for books.
Those brands are my foundation. They probably account for about 50 percent of my media consumption. The rest comes via Twitter, Facebook, email, and RSS. Those sources are important, but the subscriptions are what have earned my loyalty. More importantly, they are what earned my money. And by the way, I consume practically all my media now via my iPhone and iPad.
The final factor working in favor of the subscription's great comeback is online payment. With one-click payments, digital wallets, and app stores, it's easier than ever to initiate, cancel, pause, or renew a subscription, and they're no longer counted in years. The New York Times, Netflix, Spotify, and The Magazine all charge by the month. A month is not so scary. Escape is never too far away. Months are manageable. Years stir up commitment phobia. And $10 a month seems a lot cheaper than $120 a year.
For media companies in the mobile era, subscriptions make a lot of sense. The initial success of The Magazine and the continued growth of Spotify suggest that there is merit in charging a small fee in return for a steady flow of content.
And even if they're not going to be an easy solution to a media organization's digital revenue problems, subscriptions should at least be part of the mix. The cost of at least offering them is relatively low, and they provide an alternative to the Buzzfeed method of living or dying on social sharing alone. Plus, there's nothing to stop such organizations charging a per-unit price, too. Atavist and Byliner still do.
Subscriptions worked well in the newspaper era, but the early days of the Web laid waste to the model. However, now that we carry our media consumption devices in our pockets – indeed, now that they look a lot more like paper – we might just see the old-faithful media ploy make a stirring comeback.