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Today we look at publishing businesses, specifically the The New York Times, and visualize its successful transition from an advertising led business to a subscription one.

I was inspired to make this chart after reading a post in another Substack on the future of digital advertising.

Programmatic digital advertising completely changed the Ad industry in the last 15-20 years.

Massive amounts of ad-dollars shifted online, and companies like Google and Facebook made billions of dollars.

In the process, they upended many industries (print media was the first casualty).

However, over time, smart publishers (like The NY Times) realized that they can’t beat Google and Facebook in their own game of grabbing and keeping user’s attention. Competing for Ad-dollars was a race to bankruptcy.

Instead, The NY Times pivoted to focus on creating quality content and asking users to directly pay for it. The quality-seeking readers obliged and NY Times today has 8.6 million paid subscribers.

However, this phenomena hasn’t happened in a vacuum.

There has been a broader shift in the internet’s monetization model in the last 5-7 years. And I’m not talking about Web3.

In the early years of the internet, content was readily available and free of cost. Monetization was mostly done via advertisements - but most of the value went to aggregators like Facebook, instead of publishers.

However, over time, companies like Netflix and Spotify innovated and successfully changed behavior - making customers pay for content online. And thankfully so, otherwise we would still be at the mercy of torrents.

Same pattern is also seen in more recent platforms like Substack - where readers pay millions of dollars directly to writers every month.

This transition continue to have a profound impact on the culture of the internet - moving away from click-baity trash to more quality content will likely make the internet healthier and friendlier. I’m all for it.

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That’s all for this week. Thanks for reading! 👋