A handful of folks sent me this quip from Nate Silver a few days ago:
Slightly against interest to admit this (I don't want more competition lol) but I think we're still probably a year or two away from Peak Newsletter. It's just a really good distribution mechanism for certain types of writers. It does take some time to build up momentum, though.
One of the things that makes "Peak Newsletter" as a concept both interesting and slightly pernicious is that the growth of newsletters is somewhat nebulous and amorphous compared to other similar content industry booms. [1] For some, P.N. refers to a focus on individual brand over masthead; for others, it refers to emancipating oneself from the distribution + growth channels afforded by traditional media and social media in favor of SMTP; for others, it refers to the very calculated paid acquisition-heavy approaches of buying subscribers and recouping costs on advertising.
With that in mind, here are some scattered thoughts.
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One of the few legitimate things that has changed over the past decade is that it is much easier to solicit paid subscriptions thanks to services like Stripe. This is a technological shift rather than a cultural or consumptive one, and as much as I hate the language of "the creator economy" it does get at a meaningful point: part of the role of traditional media apparati is to provide financial tooling, and the marginal value of that role is diminishing-to-none.
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Every large media startup conveges on a mission of "change consumer behavior en masse". [2] These missions fail: Netflix did a great job destroying cable, but I don't think they were comparatively successful in net creation of television consumption; every single podcast startup or podcast-heavy media platform quickly discovered that all the money in the world couldn't get a financially non-trivial segment of listeners to start becoming rabid podcast consumers. Beehiiv and Substack's mission are both some variant of "we will become a billion-dollar company by not just capturing the existing content landscape but by growing it significantly", and I am similarly skeptical that a meaningful amount of people will dramatically change their overall consumption habits.
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One source of jet fuel for the podcast boom of yesteryear was an ocean of capital that went into advertising; the amount of money spent on advertising was justified less on hard ROIC and more on the lack of easy attribution due to the inherent nature of podcasting, and once clear data and metrics emerged a lot of the willingness to throw money at legions of Casper ads was lost (and, as a second-order effect, so was a lot of the willingness to spin up dozens of new podcasts to capture the revenue from said Casper ads). We are already seeing the same effect happen in email advertising: sophisticated vendors are only looking at intent/conversion-level data, and the emergence of co-reg has turned subscriber count and open count into a vanity metric for "platform-based" publishers.
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The trend of every social media platform is towards a capricious algorithm that intentionally penalizes long-term relationships and rewards short-term spotlights. This is antipodal to email subscriptions; creators of any type have more incentive now than ever before to try and capture their audience before TikTok yanks them away.
Are we at Peak Newsletter? Probably not. I think — to steer this into the realm of concrete and falsifiable — that more people will spend more money and time on individual writers three years from now than they do today. I suspect we will see a lot of "pullback", to borrow a financial term, over the coming years, as "content arbitrage"-style businesses suddenly no longer have a viable business model due to the deflation of advertising, but it will continue to get easier and more profitable for great writers to build their own audiences and monetize their work.
In general, I think a pretty easy way to predict much of what will happen in the newsletter landscape is to look at what happened five years earlier with podcasts. ↩︎
Most famously quipped by Reed Hastings, who said Netflix's biggest competitor is sleep. ↩︎
