Is Ghost a real competitor to Substack?

Some high profile writers have left Substack recently, but these defections may be overhyped.

Welcome! I'm Simon Owens and this is my media newsletter. You can subscribe by clicking on this handy little button:

Ok, let’s jump into it…

Is Ghost a real competitor to Substack?

Every time a market leader emerges in the tech space, people begin looking for signs that its users are abandoning it for some upstart competitor. Hence why newsletter writers attract a fair amount of attention whenever they announce they’re leaving Substack.

The platform Ghost has often been the beneficiary of this attention and is sometimes portrayed as the “anti-Substack.” But does it pose a real threat to Substack, and do the hyped defections actually signal a user exodus? Wired does a good job of exploring the differences between the two platforms in this piece:

Frankly, this designation is a bit odd. Even though Ghost has been openly courting defectors—the company has a concierge service to entice writers looking to switch—it’s not exactly a one-to-one Substack substitute. Newsletters are Substack’s core product. Not so for Ghost, which was originally envisioned as a snazzier version of WordPress when it was funded through a Kickstarter campaign in 2013. Unlike the VC-fueled Substack, Ghost is a bootstrapped affair, with a lean staff of two dozen scattered around the globe.

The business models of Substack and Ghost are also completely different. Rather than take a cut of subscriber revenue like Substack, Ghost’s paid hosting service, Ghost Pro, takes a fee, starting at $9 a month.

I can’t even begin to underscore how much of Substack’s appeal boils down to it being free and easy to use. Up until Twitter’s acquisition of Revue, Substack was the only newsletter platform that was both free and allowed users to easily charge for subscriptions.

Within just a few minutes, you can be up and running a new Substack newsletter with a Stripe integration turned on. It’s rare for a writer to transition from having no newsletter at all to attempting to turn it into a full-time career. They like to dabble in the space, sometimes for years, before making a go at monetization. Because of this, most are understandably hesitant to plop down money on a domain name, custom branding, and a recurring credit card subscription for a platform like Ghost.

Where platforms like Ghost pose a real threat to Substack is, ironically, with Substack’s most successful writers — the very people who should be most thankful for Substack’s existence. When you only have 50 paying subscribers, Substack’s 10% cut doesn’t seem like much, but when you have 3,000 who are paying $10 a month? That’s where Ghost’s payment terms start to seem a lot more enticing.

My guess is that Substack’s most successful writers, few that they are, generate a huge portion of its revenue. Matt Yglesias, for instance, has something like 10,000 subscribers, meaning Substack is taking home up to $100k a year from him alone.

If Substack sinks a lot of time and resources into nurturing a writer’s career, only for that writer to abandon the platform the moment they start making real money, then that would mean the company’s business model is fundamentally unsound. As more competitors enter the market, it needs to figure out ways to convince its biggest writers that its 10% fee is still worth the price of admission.

My latest: Can Quartz become a scrappy media startup?

In 2020, Quartz's CEO and EIC announced they were purchasing the news site from its parent company. This meant that, for the first time in its history, Quartz would be acting as an independent entity, unmoored from a well-funded corporate mothership.

I took a look at how it's fared as an independent media company.

Is Snapchat actually good for content creators?

Vox published a piece that does a good job of exploring both the upsides and downsides of being a content creator on Snapchat. The app received a lot of praise for its Spotlight feature, which paid out up to $1 million to creators, but it’s still difficult to build a real following on the platform.:

Fame, it seems, is not a viable currency on the app unless the user is already internet famous. For some, that reduces Spotlight to a hollow endeavor, despite the potential to earn from the pool of cash.

The way Babaknia sees it, TikTok produces overnight fame, and Snapchat offers overnight riches. He’s chasing both while working part time as an AT&T salesman, but the monetary success from Snapchat feels tangible. Still, he acknowledged that the chances of becoming a viral phenomenon are slim on both platforms. Snap might be the cash cow, but the downside is its lack of cultural relevance. “On Snapchat, you’re almost anonymous,” Babaknia said, explaining that the platform, despite the cash, doesn’t raise a creator’s profile. “People want to grow an audience.”

You should constantly change your subscription messaging

One thing I’ve noticed with subscription publishers is that they become too complacent with a single call-to-action and essentially copy and paste that same message within their articles into perpetuity. I wrote about what they should be doing instead over here.

Ben Thompson launches a Substack competitor

Ben Thompson announced the launch of a new product called Passport. It certainly has lots of similarities to Substack — except with more bells and whistles, like the ability for subscribers to choose how they receive certain kinds of content.

It makes a certain kind of sense for Thompson to build this type of product, given that he’s often credited with kicking off the paid newsletter craze. Hell, even Substack’s founders themselves credit him as being an inspiration for their company.

One does wonder about the conflict of interest here; Thompson writes quite often about the creator economy and has even covered Substack specifically. If he criticizes a platform’s features in the future, can his readers be 100% sure that those criticisms aren’t rooted, unconsciously or consciously, in his desire for his own product to succeed?

How Twitch kickstarted the creator economy

Wired published a piece celebrating Twitch’s 10-year anniversary and notes that it was one of the first platforms to facilitate a way for an audience to pay creators directly:

In late 2010, Sean “Day9” Plott, a fearsome and charismatic Starcraft II player, confided to his Justin.tv viewership that he was super stressed about loans for his graduate school tuition. Fans flooded his PayPal account with thousands of dollars in days. Even after the donation drive, viewers asked him how they could offer more support. When Justin.tv spun out Twitch as its gaming-focused arm months later, early employees asked users what sort of features they’d be into. Plott, who had migrated over, suggested subscriptions. “This made a lot of sense to me,” he later said to InvenGlobal. “Instead of the traditional media model of ‘pay first, consume second,’ an opt-in-support model allowed everyone to view for free and support if they wished.” He would become the first Twitch partner, and a subscription button would appear on his channel.

Publishers are producing more online courses

Digiday reports on how online courses are the new bright shiny object publishers are chasing.

I can see why online courses are attractive. Most are fairly evergreen and publishers can charge a premium for them. Depending on the skill being taught, I’ve seen courses priced as high as $1,500. Sometimes it’s better to sell a few hundred courses at an extremely high price point than trying to convert thousands of subscribers at a $10 a month level.

Inside Axios’s local news strategy

Nieman Lab interviewed Ted Williams, the Charlotte Agenda founder who’s now in charge of Axios’s expansion into local news. He revealed that Axios Local is at 350,000 email signups across its initial 7 cities, so an average 50,000 subscribers per city.

Outside wants to own the outdoor recreation media market

Press Gazette interviewed the CEO of Outside, which has essentially assembled a huge bundle of outdoor recreational publications in a short period of time. It has 500,000 digital subscribers and thinks it can get to 5 - 10 million within the next few years.

ICYMI: Did theSkimm try to expand too quickly?

The female-focused newsletter took on too much VC investment and tried to pivot to video.

Do you like this newsletter?

Then you should subscribe here:

Simon Owens is a tech and media journalist living in Washington, DC. Follow him on TwitterFacebook, or LinkedIn. Email him at simonowens@gmail.com. For a full bio, go here.