The subscription game is actually the cancel anytime game
Who’s winning — and losing — the battle to sign (and keep) the most subscribers, and why analysts should stop celebrating news media companies’ numbers
Three years ago, I have gathered birds of very different feathers to rock together within a list that comprised streaming services, messaging apps, and social platforms. Just for fun. Well, that and the educational purpose of demonstrating that Spotify could be as popular as Instagram.
Controversial? Hopefully. But that was a breeze. Because now there’s a new list and we’re activating Ultra Nightmare mode.
This renovated chart incorporates social networks and regular apps, free users and paid subscribers, game memberships and software subscriptions, YouTubers and TikTokers, podcasts and newspapers. There are no longer just birds of a different feather, there is an entire zoo right below. This catalog does not intend to be scientifically accurate — clearly — but it’ll help to establish some real-life comparison every time that someone comes up with a nonsense theory about the subscription economy.
A quick look at it is enough to inspire questions like what-the-hell-is-Kuaishou and who-the-hell-is-“Ninja”. I feel you. But there are many other permutations to consider. How four of the top six belong to one single company, why there will be more Netflix subscribers than Twitter users in the near future, how a 16-year old TikTok girl can be a media force by herself and, finally, why celebrating news outlets numbers is ill-advised, at best.
“Celebrating” is the appropriate word here, because apparently it happens every year. Some tech journalists get wind of the usual whisper from “sources familiar with the news industry” saying that despite recurrent layoffs, drop in ad revenue, decline in public confidence, all the plagues of Egypt combined, digital subscriptions are as dazzling as ever. Usually the chatter goes unnoticed, but sometimes this type of rumor-mongering (camouflaged as a prayer) gains some traction, like this story published by Axios. The text — which looks more like a press release than a journalistic piece — commends The New York Times and The Washington Post for reaching 6 million and 3 million digital subscribers, respectively. “Both companies are growing at an impressive pace,” the author wrote at some point. “Impressive” is an interesting choice of words, I must admit.
To some extent, that’s what this flamboyant list is for: to offer context to words like “impressive.” Take those 6 million The New York Times subscribers, for example. Is this number too much or too little? Axios swears blindly it is “impressive,” but is it? The Times certainly is the newspaper with the most digital subscribers in the world, but if you check the list, you’ll see that this figure is less than half the number of subscribers of Deezer, for example. Also, it is considerably less than the number of subscribers of the Adobe Creative Cloud softwares. Are there more people in the world tweaking presets in Lightroom than interested in news? It appears so. And if it’s true, that would be a better use of the word “impressive”.
But, after all, is it fair to compare such different products and services? Probably not, but whoever believes the world is a fair place has chosen the wrong article to read, or the wrong era to live in, for that matter.
Although quite different in nature, these subscription products suggest cash has been spent: NYT asks approximately $17/month while Creative Cloud costs $10 to $52/month. When we send these comparisons to the free subscriptions land, everything seems even more unfair, but it also becomes more embarrassing as well.
It is obvious that subscribing to a YouTube channel or following a TikTok account — both of which are free — is cheaper than subscribing to The Washington Post, which is almost free ($2.40/month). Still, doesn’t it seem a little lopsided that a teenager like Charli D’Amelio has 107 million followers on TikTok while The Post has only 3 million subscribers? No? Okay, and what about Joe Rogan? Doesn’t it seem disproportionate that one single episode of his podcast is streamed and/or downloaded 12 million times in the face of the 900,000 “donors” of The Guardian?
Sometimes you need to consider more than you might think to get the famous “full picture,” and the last 25 years can provide the necessary context.
News companies embraced the internet in the mid-1990’s. In their favor, they were one of the first industries to envisage that extremely-promising-incredibly-slow network as an extension of their business. Some of these media outlets went online a decade before Facebook and YouTube, and 15 years before WhatsApp was invented, just to name the top three on our list. But this spark of innovation faded out on page 2. Since 1995 until this very day (that’s not a figure of speech), media executives have been pull their hair out over pricing, based on the naive premise that they would be the ones to dictate how much their readers should pay for the news. Media companies have spent so much time debating the memorable “information wants to be free” misinterpretation that, in the end, information became unattractive and expendable.
Another sector that also spent much more time in the 1990’s debating pricing instead of product was the record industry, and the widely documented effect was: in 2003, a computer company created an entirely different model by selling songs individually, and five years later a Swedish startup upended the music business by launching the streaming culture.
Oddly enough, this is a classic paradigm shift from the 21st Century that media executives never fully comprehended. Due to this pricing obsession, and the uncanny inability to be minimally innovative, these companies missed the opportunity to create a range of products and services from other fields. Yelp could have been designed at the headquarters of The Los Angeles Times, NPR should be the realm of podcasts not Spotify, not to mention that it is simply a shame that Craiglist wasn’t invented by a news company.
The lesson from 25 years ago mirrors today’s reality, but on a much larger scale. As time goes by and more new players emerge, the more the subscription wars leave the price arena. In an ideal world, the swift response to that should have been focusing on the backbone composed of value, innovation and access. But that’s the thing, media companies rarely respond as expected.
Combining this trifecta of value, innovation and access is what, at the end of the day, leads someone to subscribe to any product or service — whether paid or free, whether it costs 2 bucks a month (like The Washington Post), or $52 (like the Adobe Creative Cloud apps). There are numerous newsletters in the world, for example, and almost all of them are costless. I’m subscribed to three, most people never sign up for any in their entire lives. Why is that? There are 30 million channels on YouTube (also free): how many do you have in your “subscriptions” tab? Ten? Twenty at most? Maybe none. Why?
This reflection also works to show that costing nothing or next to nothing doesn’t mean much, and every subscription, even when it’s free, counts. Remember Periscope? So free, and so done. No matter whether it’s free or not, they’re all fighting for your hit-that-subscribe-button in the same way newspapers, streaming services, game memberships, book subscription boxes are after your money.
That’s why comparing the number of newspapers’ subscribers with YouTubers’ subscribers could sound schizophrenic at first, but it’s not. The main factors that these two products have in common are audience and ad money. When newspapers’ ad money vanished, part of it went somewhere else, to other platforms. Moreover, in a very short period of time, these new media stages have produced new media forces as well, which has also helped with rerouting the cash flow.
In 2020, MKBHD reached 12 million subscribers, and Joe Rogan’s podcast hit that 12 million downloads per episode mark. Regardless of whether you’ve heard of them or not, these two are, alone, a much more powerful media force today than 1,250 of the 1,280 newspapers that exist in the United States (and that’s a generous estimate). The whole newspapers drama involving Google and Facebook is much bigger than “mom, they stole my lunch money,” it’s more like “mom, they stole my lunch money, my savings for college and the mortgage for the house I haven’t bought yet.”
As a consequence, the value of these new media characters, like MKBHD and Rogan, is crucial to the subscription game. By signing a check for $100 million to secure Joe Rogan, Spotify strengthened its position in the audio on-demand market. The same goes for Howard Stern, who recently renewed his deal with SiriusXM. The company had 600,000 subscribers when Stern joined them in 2006, now it has over 30 million. And that’s why securing an exclusive name can make a substantial difference in the end.
Because at some point in the near future — and this is where that “bigger picture” comes in — people will start to use their right to “cancel anytime.” Are we keeping Netflix or Disney+? Photoshop or NYT? But not only those. The (un)conscious dilemma is also true for free subscriptions: from YouTube channels to Twitter, from newsletters to Reddit. That’s when the subscription game will be recognized and called by its real name: the cancel anytime game.
Although in small doses, this is already happening. When someone leaves Facebook once and for all, this customer is exercising his “cancel anytime” freedom. If he deletes SnapChat from his phone or flag that precious newsletter as spam, same thing. The only difference with the free segment of “cancel anytime” is that cancel means “abandon,” and “anytime” really means anytime.
Which brings us to another advantage of such a heterogeneous list: being able to perceive who is winning — and losing — in this battle to stay relevant, and to admit that news media companies still have a very, very long way to go until they reach an actual “impressive” growth.
Three years ago, in addition to that “Spotify vs. Instagram” story that generated the first list, I also wrote another article called “How many subscriptions can you afford?” It was a good interrogation at the time. Today, that question would be quite distinct though: more like “how many subscriptions can you absorb?”
Because this is the final puzzle. Anyone who believes that the “subscription game” and the “cancel anytime game” are the same is sadly mistaken. The pragmatic difference between the two of them is that the latter, unlike the first, is no longer an “eternal game.” Companies cannot play it until they make it. The more new competitors enter the arena in search of people’s attention, the faster the game runs to its end, which means less time to figure out how to win. If this is particularly treacherous for those at the front, imagine for those at the end of the line.
Or, in this case, at the end of our list.