The Creator Economy isn’t overhyped
PLUS: Why FiveThirtyEight is struggling
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The Creator Economy isn’t overhyped
A few weeks ago, the newsletter Big Technology published a piece titled “The Creator Economy Was Way Overblown,” and it was widely shared in media circles. I’ve seen other signs of creeping cynicism about the industry; just last week I sat on a panel where one of my fellow panelists expressed extreme pessimism over the future of the Creator Economy. Many of the arguments boil down to two core points:
The most successful creators often churn out sensationalized, low-quality content.
A tiny percentage of creators generate the vast majority of revenue, meaning it’s nearly impossible to succeed in the industry.
I don’t agree with either of these two points and could dedicate an entire newsletter to dismantling them, but life is short and I’d just be rehashing talking points I’ve already addressed in previous issues.
But I couldn’t help but think about those cynical takes as I was reading this Hollywood Reporter profile of a YouTube channel called Dead Meat. It started as one guy’s obsession with horror films and eventually grew to over 5 million subscribers and 2 billion channel views. In the piece, he provided some insights into the channel’s finances:
Janisse, 33, shares that 60 percent of Dead Meat’s annual revenue comes from ads on YouTube; other sources of income include sponsorship deals (25 percent), donations from supporters on Patreon (8 percent) and ads and sponsorships for the Dead Meat podcast (5 percent).
The channel’s Patreon subscriber numbers are publicly available, so some back of the envelope math reveals that it’s generating something around $2.6 million a year.
It’s just amazing to stop and consider that we live in an era in which a random person can take his obsession with horror movies and turn it into $2.6 million in revenue. If this guy had been born 20 years earlier, then this passion would have been virtually worthless — at best, he could have produced a tiny print zine — but now he can build an entire media company around it that reaches millions of people
Every day I encounter more and more creators like him — people with niche obsessions who, for the first time in human history, are actually able to monetize those obsessions. That’s not to say that it’s easy to do so or that most aspiring creators don’t fail, but there’s just no doubt in my mind that we’re witnessing a new evolution of creativity that will impact the livelihoods of millions of people who, in previous eras, would have been shut out of creative fields entirely. If anything, the Creator Economy is underhyped.
Do you have a product/service that caters to creators, media operators, or marketers?
I surveyed my audience to get a better understanding of what industries they work in, and here’s the breakdown:
Media/journalism/Creator Economy: 64%
Venture capital/finance: 1%
If this is an audience demo that you’re trying to reach with your marketing, then head on over to my advertising page for details on audience size, ad formats, and pricing.
How Overstory became one of the fastest-growing media companies in Canada
If you read articles about the state of local news, you’ll come away with a pretty pessimistic view of the industry. But while legacy newspapers have certainly faced a steep decline, there’s a burgeoning explosion of local media startups that are innovating in the space.
One such company is Overstory Media. What started as a single local newsletter in Victoria has since expanded into 14 separate verticals operating all across Canada. In a recent interview, I spoke to CEO Farhan Mohamed about why he got into local news, his company’s acquisition strategy, and why he’s optimistic about the state of local news.
Check out our conversation in the video embedded below:
If your email provider doesn’t allow video embeds, then you can find the video over here.
538’s struggle to gain relevance outside of election cycles
The Daily Beast reports that ABC News is considering shutting down FiveThirtyEight once Nate Silver’s contract comes up for renewal this year.
538 has had a rocky history. What started out as a standalone site eventually migrated over to The New York Times, where it was a major traffic driver during the 2012 election cycle. But Silver bristled at the NYT’s internal politics and rules, so he took the publication to ESPN in 2013 with the goal of turning it into a more ambitious data journalism site that covered topics outside of politics.
ESPN struggled to monetize the site effectively, so in 2018 the platform migrated to sister company ABC News. Now it’s on the chopping block once again.
This is an outsider’s perspective, but my general sense is that 538 struggled to gain relevance outside of election cycles. Its ambition was to usher in a new era of data journalism that spanned across topics like sports and business, but it was easy to forget about the site entirely in between presidential election cycles.
Meanwhile, many media outlets have gotten better at producing 538-like election coverage — some by hiring away 538 staffers — and so the site has felt less essential in recent elections. Nate Silver certainly still is a star writer, but I’m not sure you can build a huge media brand around a single star. I don’t know if he still owns the 538 brand, but assuming he does, it’ll be interesting to see where he takes it once his ABC News contract is up.
What do you think?
The Creator Economy is transforming the career trajectories of elite athletes
In 2021, the Supreme Court ruled that college athletes could finally accept sponsorships and other forms of compensation from their likeness. This triggered an explosion of dealmaking as athletes rushed to monetize their huge followings. The New York Times Magazine published a deep look at how this has reoriented the business of college sports. For some athletes, the effects have been seismic. Here’s a snapshot:
By last fall, in an act symbolic of the newly liberated college athlete, [college basketball player Armando Bacot] was openly driving an $80,000 Audi. His portfolio of deals totaled well over $500,000, according to his mother, Christie Lomax, who acts as his manager. (Because college athletes aren’t required to reveal what they earn, dollar amounts are difficult to verify.) In November, on a day that the Tar Heels didn’t hold practice, Bacot participated in photo shoots for three different companies: BOA Nutrition, MoneyLion and Nerf. Love, too, has been thriving: His projected annual income approaches $400,000, as compiled by On3, a recruiting website. “They’re setting themselves up for life after basketball,” [athletic director Bubba Cunningham] said.
Many of these sponsorships are being targeted toward athletes’ social media accounts, many of which have racked up enormous follower counts. What I find most fascinating about the whole dynamic is how it’s transforming the career trajectory of the elite athletes.
Prior to the ruling, athletes were incentivized to turn pro as early as possible so they could maximize revenue during the short period of time they’re at peak performance. But now that they can generate significant revenue while still in college, they’re much more likely to finish their degrees — an accomplishment that will drastically increase their chances in any post-sports career.
These college athletes are also becoming mini-media moguls, setting up diverse revenue streams that can extend their careers significantly. Pro athletes are extremely injury prone and churn out of their sports at high rates. But now that they own their audience, they can continue leveraging their reach long after they leave the court or field. We’re seeing a major shift in power away from the major sports leagues and media corporations toward individual athletes. It’s amazing to watch.
Other quick hits
The AP "makes the vast majority of its revenue (82%) from licensing its stories to other newsrooms. Less than 10% today comes from advertising." [Axios]
"In 2020 The Bulwark launched a premium service called Bulwark+, which now has over 20,000 paying subscribers, and a weekly livestream event, in which hundreds, if not thousands of members come to interact with staffers as well as each other." [The Squeeze]
I wonder if US News diluted its brand too much when it pivoted away from news. The news brand is what gave its ranking so much influential weight, but now that its newsroom is tiny it's lost its journalistic heft. [NYT]
Another company is taking a crack at the subscription bundle. So far, none of these has taken off in a big way. [Press Gazette]
This is some of the worst newsletter advice I’ve ever seen. [Twitter]
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Simon Owens is a tech and media journalist living in Washington, DC. Follow him on Twitter, Facebook, or LinkedIn. Email him at firstname.lastname@example.org. For a full bio, go here.
Overstory co-founder Andrew Wilkinson has his hand in so many things. Very fascinating
Nate Silver would be a great Substacker. Seems like he went too broad instead of going deeper into politics like a Politico type site
Funny that this Overstory Media interview comes out the week before they laid off a bunch of journalists from their flagship publication, the Capital Daily Vic.
Last month, they also laid off a ton of employees at the Burnaby Beacon, the Georgia Straight and The Coast. They are becoming a legacy media chain without the legacy.