Plain English with Derek Thompson - Why the U.S. Media Industry Is in Meltdown

Episode Date: January 23, 2024

Sports Illustrated layoffs. The demise of independent Pitchfork. Hundreds of millions of dollars in losses at major newspapers like the Washington Post and the Los Angeles Times. The state of the U.S. news industry is dire. How did we get here? Who knows the way out? The Ringer's Bryan Curtis joins the show, with contributions from an interview with NPR's David Folkenflik. If you have questions, observations, or ideas for future episodes, email us at [e-mail]. Host: Derek Thompson Guests: Bryan Curtis & David Folkenflik Producer: Devon Baroldi Learn more about your ad choices. Visit podcastchoices.com/adchoices

Did Don Draper really buy the world of Coke? Did Tony Soprano really die? Or just order more onion rings? The finales of our favorite shows can make us argue, make us cry, and make us crazy. From Spotify and the Ringer, I'm Andy Greenwald, and this is Stick the Landing, a new podcast where we'll be telling the story of modern TV backwards, one fade out at a time. Find Stick the Landing on Wednesdays on the prestige TV feed, on Spotify or wherever you get your podcast.

Hi, everybody. this is a quick announcement before today's show. Yet again, we have published a podcast that dropped on a day with extremely relevant breaking news. Hours after the show, which is about the halacious state of the news industry, went up. The Los Angeles Times announced it was laying off more than 100 people, 23% of its newsroom, which is one of the largest, if not the largest workforce reduction in the 142-year history of the paper. The layoffs include the papers Washington Bureau Chief, Deputy Washington Bureau Chief, business editor, books editor, and music editor.

On the sports desk, the Los Angeles Times now has no traveling beat writer for the Dodgers, the Angels, the Clippers, the Kings, the Ducks, the Sparks, L-AFC, Galaxy, or Angel City. This absolutely sucks. The podcast you're about to hear is largely an analysis of why we're seeing a cluster of mass layoffs and business closings in news media after a hard pandemic, after a hard decade, after a few hard decades, the news industry. The LA Times, and the story of the LA Times very much fits the analytical story that we tell on the show. Like so many news organizations, it was in a state of shrinking, in a state of structural decline. It was bought by a billionaire, Dr. Patrick

Shun Shung, a doctor without direct exposure. or expertise in running a news business. And what appears to have happened here is that bad management has made a bad situation worse. As a journalist, though, I can't treat layoffs like this as if they're just another distant thing to analyze. This is not a matter of near cold analysis.

I know and have worked with several of the people just laid off from the Los Angeles Times. The situation sucks. The economics of this industry flatly suck. And that is why I think, think it's important to think broadly about why and where we can go from here. Now, on with the show. Today's episode is about the dire state of news media economics. Last week, in one 48-hour period, bad news struck two absolute icons of journalism. On Wednesday, Condonast folded the online

music magazine pitchfork into GQ and announced layoffs. Two days later, the publisher of sports Illustrated, announced they would be laying off the entire staff. Journalism is in a constant state of hair-on-fire mayhem these days, this year, this decade, this century. But these two bits of news hit me particularly hard. I graduated from college in 2008, and when I started to get the journalism bug, two of the coolest places somebody like me could have possibly landed were Sports Illustrated and pitchfork.

I mean, how could you possibly beat deeply reported sports stories? and Ariadite music criticism. These, to me, were the pinnacle of cool journalism, and both were laid low within a few days of each other. Of course, it would be a mistake to analyze the death of Pitchfork or Sports Illustrated as if these were unique calamities in the news business. The broader truth is that this industry

is in many ways undergoing a kind of slow death. Among major newspapers, the Washington Post, which made more than $100 million every year between 1996 and 2000 lost an estimated $100 million last year. They are facing layoffs and buyouts numbering in the hundreds. The Los Angeles Times recently lost its editor-in-chief. They're losing up to $40 million this year, and staffers staged a one-day walkout, a historic one-day walkout

after their EIC quit and the owner announced layoffs. Condonast is cutting 5% of its workforce. WNYC cut 12% of it. its workforce. It's the same story among startups and once promising shooting stars. BuzzFeed News is down. Last summer, Barstool Sports laid off 25% of its staff. Vice has announced several rounds of layoffs. The Messenger, a media startup with ambitions to make $100 million in revenue per year, came up $97 million short of that figure in 2023 and seems all but destined to peter out in the next few months. Cheddar News once billed as CNBC for millennials now appears to be

nearly dead. This all sounds incredibly dire, and it is incredibly dire, but the bright side is that if I think about my own media diet, my ears and inbox are ecstatically full of fantastic and brave reporting and mind-expanding analysis. The problem is that the success stories form a barbell. There are rich newsletter writers, individuals, and there are big, huge, international, successful news organizations like the New York Times, which are in many ways more successful and dominant than ever. There are city-states, and there are empires. And so what initially might seem like the death of the media turns out to be something more like the death of the middle, as Ezra Klein recently put it in an essay. specific, narrow, weird, and wonderful small shops are thriving, giant conglomerates who benefit from winter take all dynamics to eat the market, they're doing well too. It's the middle that's

not. So how did this happen? And why, in the midst of an expanding economy, do things seem so unusually dire in the news industry right now? To help me answer these questions, we have the ringer's own Brian Curtis, co-host of the Press Box podcast, but that's not all. I've been conducting several interviews in the last few weeks on the state and future of media and entertainment, and you're going to hear excerpts from one of those interviews with NPR's media correspondent, David Fulkenflick. I'm Derek Thompson. This is plain English.

Brian Curtis, welcome to the show. Thanks for having me, Derek. It's good to see you. Great to see you. I want to do a few things in our time together. I want to talk about the news of the moment, this sad and strange cavalcade of bad news for the media business. And then second, I want to sort of broaden the lens and get some context for why the 21st century has been such an unrelenting mess for media economics.

And then finally, we'll talk about bright spots and the lessons that we can glean from the bright spots. But I really want to start with Sports Illustrated because this is, again, a sad death, a strange death. It's a very strange story. I think it's weirdly emblematic of this awful moment in news economics. Sports Illustrated holds a very special place in my heart. It might have been the first magazine I subscribe to.

It's definitely the first magazine I truly loved when I decided I want to become a journalist. You have an article up on Theringer.com that points out that Sports Illustrated's demise was really death by a thousand cuts. Can you explain who owns SI and how that strange ownership model contributed to its demise? I can certainly try, but you just have to walk me through this because I'm still making sure that I have my mind around it. They're owned by authentic brands group. Authentic Brands Group is a company that manages brands. Now, what brands you might say, Derek? Well, that includes Muhammad Ali.

That includes Dr. Jay's brand. That includes Elvis. That includes Billabong and other companies that you might have been familiar with at a different age of your fashion. Authentic Brands Group then licenses Sports Illustrated to a second company, which is called the Arena Group. The Arena Group's website says that they are an innovative technology platform and media company with a proven cutting-edge.

Playbook that transforms media brands. Okay. So we got the brand-owning company that is licensing Sports Illustrated to the brand transforming company. And the second of those companies failed to pay their licensing agreement. And so the agreement is dissolved.

That's where we are with Sports Illustrated. And I guess a slightly bigger story would be that Sports Illustrated used to be owned by Time Inc. Time Inc. sold Sports Illustrated, or at least the rights to publish Sports Illustrated and all of its archives to the owners of the Muhammad Ali and Dr. J. Brand,

and then they license out the rights to publish new articles under the SI brand to this other group that then failed to make its quarterly payments. I mean, just you don't get into a mess like this if the economics work in the first place. And what's so sad to me

is that the very fact that Sports Illustrated had become something licensed to be licensed to be published is emblematic. of how far a storied brand like this, a storied magazine like this has fallen in the last few decades.

And clearly, it's not just SI. It's not just pitchfork. As I recounted in the open, it's Vice, it's Gawker, Gawker 1 and Gawker 2. It's Jezebel. Kahn Nast is laying off 10%, WNYC. Two of the biggest newspapers in the country,

the Washington Post, and the L.A. Times, reportedly lost. It combined $150 million last year. Why do you think this moment, especially when the economy is growing, why do you think this moment has been so particularly gnarly

for the news media? We almost need a list. It's like an old school vulture ranking of problems, but I'll throw a few out for you and you can put them in any where you want. Management missteps, number one. Number two, probably the end of the Trump bump, and if you believe the semaphore

article that came out yesterday, a new Trump bump that is not quite as big as the old one. I would also put on that list, rich proprietors that are tired of losing money, or at least tired of losing money on the scale that they're losing it, especially in the case of the Washington Post and the LA Times. And then the fourth one, I would say, was,

especially in the case of newspapers, the fact that the New York Times is gobbling up people that in another timeline would be subscribing to their local newspaper. How's that for a list? It's a good list. There's one biggie that I definitely want to talk to you about, and that's technology, because there's two stories that I think I could tell about the last 20 years.

If someone said, like, what's the grand narrative here? Why is it not just one or two magazines or one or two newspapers that are struggling? It's dozens of newspapers closing every year. It's dozens of magazines failing every decade. To me, you can tell this as a pure technology story or you can tell it as a people story. The technology story is that the internet comes along and really starts to pick up steam with Craigslist and Google in 2000, 2004, 2005. Facebook obviously takes over around the late 2000.

thousands, 2010s. And the internet does a few things. It increases supply. Suddenly, anybody can become a blogger, can compete with old-fashioned newspapers for people's attention when it comes to analyzing the news, writing about the news. Number one, increases supply. Number two, it destroys local advertising monopolies. Like the Washington Post. I grew up in Washington, D.C. The Washington Post had a local advertising monopoly for car ads, for apartment listings. Those monosopholes, those are absolutely destroyed when the internet comes along, and you can just go to Edmonds or Cars.com to figure out what car to buy. You don't have to buy a bundle that has news about Fallujah and also car advertisements in the back.

So it destroys local monopolies and the cross subsidies that they created. It also nationalized the news. I think there's something about the internet that allowed people to, you're living in, in St. Petersburg, Florida, you're living in Peoria, and you are, it's easier to follow, like, national news and maybe as a result, more attention and more dollars flow to national publications, and that starves local media. So I'd say, yeah, the internet does all these things, increases supply, destroys local monopolies. You could say it's a tech determinist story, or, and this is where your point comes back in, you could say, no, Derek, like, tech is just a tool. It's a story about people who use this tool badly.

newspapers were badly managed in America in a lot of different places at the local level, at the national level on both coasts. So when you think about the tech story and the people story, how do you sort of fold those together? I think the answer is almost certainly both.

But let's go to the people story, for starters. You know, the thing people always point to is the great air of newspapers is that when they went online first in the late 90s, early 2000s, that they were all free. And they did not say, hey, guess what, folks, you've got to pay for news.

This is important. Put your credit card in here and we could argue that at that period of the internet, that would have been a weird thing to do to try to pay for news. We weren't used to that. The New York Times was free at that point, so we might still have picked the glittering big fat national newspaper over the skimpier local paper.

But there was certainly some truth to that. I think also just the one thing I'd add to your technological story that's so fascinating to me is I grew up in Dallas-Fort Worth. Not only did they have a local advertised monopoly, the Dallas-Fort Worth newspapers had a national newsman monopoly in Dallas, right? If I wanted to know about politics, I wasn't reading the New York Times. I was reading them. If I wanted to read about international news, I was reading my local paper. So as soon as you stripped that away for all the reasons you elegantly laid out there, what was left, right?

It's that school board meeting that everybody cites, who's going to cover the school board meeting? Who's going to cover the mayor's office? Totally worthy beats, but a very, very tough sell when you're trying to get people to pay for news. Jim Fallow's guy used to work with me at the guy, legend, he used to work

with me at the Atlantic and I was his own substack. He made this point over and over to me whenever I would write an article

about, I remember when I was maybe 22, 23, I wrote an article about why Newsweek was failing. And I said, oh, it's failing

because it's not interesting anymore. And he said, Derek, Derek, Derek, Derek, it's not just Newsweek that's failing. You have to open your eyes.

It's so many different magazines and so many different newspapers that are failing. And the problem here is, And I've always loved this point.

He said newspapers are a cross-subsid. Like, Fallujah doesn't pay for itself. Fallujah is paid for, or the reporters going to Flusha to report in the Iraq War, like, you know, going to Azerbaijan to report on Nagoro Karabakh. They're paid for by advertisements in other sections of the newspaper. And then that work is bundled together. And when that bundle was unstripped, it made it really hard for news to pay for itself and suddenly revenues came all the way down

and people had to be laid off. There's one other element here that is worth talking about. I spoke doing a bunch of interviews on the future of media and entertainment. I spoke to David Fokinflik, the chief media correspondent for NPR, and he made this really interesting point

about why he thinks we're in a media recession. Devin, could you play Audio One? What we've experienced is a media recession. We are not in an actual recession. You know, so you have layoffs in, yes, the big tech companies like Google and Amazon and Microsoft, right, and YouTube and others. But it's really been hard hit in the media. And I think not the full element, but part of the element is that everybody is anticipating a recession. And one of the first things they do is slash back advertising and it is brutalizing the media economy.

So there is a true media recession at a time the nation has had what everybody's believes will be a soft landing. Brian, what do you think of David's point that just about any company with exposure to advertising has been hurt in the last few years by the fact that all of these industries, fearful of an incipient recession, have pulled back on advertising and thus that's decimated news across the country? Certainly part of the problem. What then that brings us to a second question is newspapers now or media outlets now, whether they are dependent on advertising or dependent on subscriptions, right? If you read that big sprawling James Bennett essay, which I will not try to say in one sentence, part of what he said for about the New York Times, we became a magazine that was beholden not to advertisers, those newspapers had been in the past, but are beholden to our subscribers. And cutting advertising, the media companies getting pulled back in that place, that doesn't help. But they've also got a bigger subscriber problem, right? If you look at the Washington Post, they lost subscribers over the last several years.

The LA Times has had trouble adding subscribers, right? So absolutely, yes, to the advertising thing, but I think it's a double picture there. Yeah, I think pulling it all together, I really like the list that you've had at first. And I guess I tell the full story this way, the Internet created an enormous challenge to publishing incumbents because it destroyed these local monopolies. That made management much more sensitive to the kind of missteps that have clearly, been endemic to this industry. A lot of these media properties were bought up by rich folks. You know, Jeff Bezos bought the Washington Post, the doctor who bought the Los Angeles Times.

You have Lorraine Powell Jobs, who owns the Atlantic. Some of these billionaires are fantastic proprietors of their brands, but some of them don't know what they're doing. I mean, you know, they don't come from the industry in which they're buying. And so some of them mess up. And so even though we had what you described, I think very accurately, as a huge Trump bump between 2016 and 2020, that Trump bump has come all the way down, and it doesn't look like it's recreating itself anytime in the near future. One more point that I want to make, if we're trying to sort of figure out what the hell has happened to media economics the last few years, last, you know, 18 months, last 18 years. There's a hedge fund story that we have to tell. I want to read a few

excerpts from an Atlantic cover story by McKay Coppins, an Atlantic staff writer. He writes, quote, on the surface, the answer to what killed local newspapers might seem obvious. Craigslist killed the classified section, Google and Facebook swallowed up the ad market, and a procession of hapless newspaper owners failed to adapt to the digital media age, making obsolescence inevitable. This is the story we've been telling for decades about the dying local news industry, and it's not without truth, end quote. But soon thereafter, Coppins. says that leaves out the fact that a lot of these local newspapers have been bought up, not by billionaires like Jeff Bezos, who are totally hands off, but by hedge funds and

private equity that have sucked them dry, continuing with McKay quote, Alden Global Capital, a secretive hedge fund, has quickly, and with remarkable ease, become one of the largest newspaper owners in the country. The model is simple. Gutt the staff, sell the real estate, jack up subscription prices and ring as much cash as possible out of the enterprise until eventually enough readers cancel the subscriptions

that the paper folds or is reduced to a desiccated husk of its former self. Today, half of all daily newspapers in the U.S. are controlled by financial firms, end quote. Brian, in your reporting, in your reading,

how blameworthy do you find this relatively novel financialization of the news industry. How blameworthy is private equity and these kind of hedge funds? Well, it goes back to the conversation we were having at the very beginning. The reason they're owned by the hedge fund is because they weren't doing well enough before, right? There's a reason we got here. But then you get to the hedge fund, and McKay's synopsis here is absolutely accurate. You know, I write about the Denver Post a long time ago in their sports section when they

were under the thumb of Alden. And that's exactly what it is. And it's funny because they're taking advantage of the monopolies that you and I were talking about, right? There is still a newspaper in Denver. It is called the Denver Post. There are people in Denver like, I want to read about the school board. I want to read. I want to support news. So I will pay you, Alden. Meanwhile, you're giving me a worse product for more money, right? And then until there's no product at all, and we go, wait, what happened to the newspaper? So, you know, so yes, of course, but I think then again, we have to track back to all the points you made before. Yeah, right. My synthesis would be the private equity, right, sweeps into local newspapers as an industry,

because they're a very specific type of industry. They're in structural decline, declining profits, but still decent opportunity for cash flow. People are subscribing to these newspapers. They're subscribing to whatever. It's at the Baltimore Sun, the local Denver newspaper. Often, they're older. And so their subscriptions are going year after year, and they're not necessarily checking them. It's kind of like when AOL was still, you know, making all, like, I think their only profitable segment at one point was just relying on 80-year-olds to not check up on the fact that you still didn't have to pay for dial-up service. But you get a decent enough business to a mash capital, then you can, you know, deploy it on,

I don't know, whatever it is, commercial real estate, European debt bonds, and then you can sell the firm. And that's what they seem to be doing over and over again. So it does just seem like when management fails and the economics are rotten, it creates an opportunity where you get even more rapacious management in place, and that's just made a situation. even worse. Should we talk about some bright spots? I think we should. The New York Times is a remarkable success.

I was going through its financial records from the last 20 years earlier today. This is amazing. In 2000, the New York Times made $1.3 billion in advertising. Last year, in 2023, it's not even going to make $500 million. So that's the only thing you knew about the New York Times.

that its core business from the year 2000, declined by 66% in 20 years, you'd be like, holy shit, the New York Times doesn't exist anymore. Except something else happened, which you've already alluded to, circulation revenue went from $476 million in 2000 to $1.5 billion in 2023.

And so the New York Times, which used to be 75% advertising, is now 70, 80% subscription. What's the story that you would tell about the time's success. How do you think they managed this really? I mean, it's an incredible tech story. It's an incredible turnaround.

How do you think they did it? Partly by becoming a lifestyle brand as much as a news company. I'm going to go into the New York Times company, and I'm going to play Wordle. And I get a section on Sundays every few weeks that's for my kids that my kids love to read, not to mention those international reports you talk about, Not to mention sports now, right?

They control a huge amount of the American sports writing industry after they bought the athletic. And if you think back to newspapers, those glory days we're talking about, newspapers were lifestyle brands. That's what they were, right? It was a vehicle for news, but it was also where you buy your car. It was, you know, where you see your classified ads or where you see pictures of your kids in school, right? That was part of the community they created. And so I think the Times has done that on a massive scale. And I think, you know, when I talk about it, like, what would make you pay for something?

What would make you pay for news? Not just news. That's part of it, but a feeling that I am part of something I really like, right? These are, these, this is a place I want to be. And I think the Times has done an amazing job of creating that. You just amount of me of one of my favorite stories about newspapers from newspaper history. George Gallup, before his name was synonymous with American president. polling was a dissertation student, I believe, at the University of Iowa. And his dissertation was about

how people read the newspaper. And so I believe it's called Des Moines Register, right? Is that the name of the newspaper in Iowa, I believe? So he does this really interesting at the time, very novel at the time experiment. I'm pretty sure this in the 1920s, where he simply watches people read the newspaper. And he points out little parts of the newspaper and he says, did you read this part? Did you read this part? Did you read this part? So it's like an ethnography of how people engage with a newspaper product. And the conclusion of his dissertation was that newspaper editors and journalists thought

that the most popular parts of the Des Moines Register were the, quote, most important parts of the Des Moines Register. It was the front page news. It was presidential news. Maybe it was international news. Certainly it was whatever is happening for the governor's mansion in Iowa. No way. Not at all.

the thing that the men looked at the most was cartoons, and the thing the women looked at the most, I think might have been advertising for dresses, but I don't remember that for sure. I know that for the men, the men mostly looked at the political cartoons. And it goes to this idea that,

you know, that I think it's so important that, again, I think I'm probably stealing from Jim Fallows, the news industry, or sure, news economics, has never purely been about at the largest scale, people paying for the news.

It's always been this kind of lifestyle, bundle. And so you're right, it is interesting that the Times essentially has recreated that which already existed a hundred years ago. Yeah, cooking. Crosswords. I mean, we could go on and on, right? Your sports news. I mean, that's the old newspaper model. They're just doing it at scale and an incredibly high level of, right, with great international reporting and all that stuff, too. So the Times launched its muted paywall in March 2011, and McKinsey predicted that the ceiling for subscribers was 600,000. Today it's at 10 million and growing. And again, I want to pull in a David Fulkenflick quote here because I thought it was really interesting. As David said, when the Times

first experimented with paywalls, the paywalls actually failed. And I had forgotten this story. Devin, can you play Audio 3? I mean, look, one way to think about is this. When I talked to Arthur Salzberger Jr. in the walk-up to them unveiling this, the paywall, right? And they had tried it once earlier with just the opinion writers, which they actually rightly realized would be one of the main propellants of stickiness and of interest. But it just flopped. It just flopped. It didn't take and they had to abandon it. And what he said was, look, I look at public radio. You know, you guys on average have about 10% of your listeners join and give money. voluntarily. It's still there, whether or not somebody gives. But 10% because they feel emotionally

invested and value what you do and you ask for it, they give. He said, if we could get 10% of people who visit our website, you know, they had, I don't remember at the time, it might have been 80 million. It might have been 180 million. Whatever it was, people visiting, I don't think it was that much, but every month, if we could have that 10% of that, we want to build. He's like, I'll start with five, but we can build. Well, they've done something extraordinary, and they have built it so that 10 million people are paying. Brian, what do you think changed between 2011 and 2024? Why do you think initial returns from paywalling for the New York Times just didn't seem to indicate that this was going to be a very successful business model?

And now looking back from the perspective of 2024, it is obviously smack you across the face, like the only business model that's working in journalism. How did that happen? Just thinking off the top of my head, a couple things. One is getting used, people used to paying for news, which is something that feels like it happened, at least online in the last, what would you say, five, 10 years, somewhere in that time period, right, where you really get people. Trump's election certainly helps that when subscribing to a media organization becomes an act of joining the resistance, right? I went to fight Trump, so I will subscribe to the New York Times. But beyond that, I think really looking forward. I mean, I remember when they bought the athletic, and I said, what does the

Times want with sports writing? The Times of the sports section has always been one of the most neglected sections of that entire paper. But what I didn't understand or didn't understand enough was, oh, they don't see this as we're really getting into sports now. They see this as we want to give you everything. We want to make ourselves the one thing you subscribe to. And I think their ability to do that and to kind of push everybody else off to the side and say, if you're going to just pick one thing, whether you live in New York or Los Angeles or Honolulu or Dallas or or London or wherever it is, make it us, has been indescribably successful and great for them and bad for everybody else.

Something that you made me think of is I sometimes talk to my friends at the New York Times. and look, they do some fantastic work on their tech team covering monopolies in Silicon Valley, and I absolutely cheer on their wonderful reporting many times. But also sometimes I want to look at them, and I'm like, have you seen the effect that you're having on the news industry? Like, I don't know if I would consider,

like, from a, you know, Brandeisian perspective, the New York Times to be a monopoly, but, like, there is certainly a winner-take-all dynamic with the New York Times that the Times is often critical of in other industries. That's a drive-by comment at the New York Times that I'll move right along. It seems to me I would love to know, like from like a media consulting standpoint, like if I was going to, you know, help the Atlantic make more money, help the ringer or, you know, help some other company make more money. And someone said to me, why does someone subscribe to a news organization?

It seems to me there's like three different reasons. One reason is like utility. Like cooking is utility. I need to know the information to put this dish together. To a certain extent, you could say the Financial Times, the Mall Street Journal, is also utility. It's a different kind of utility. It's getting the best information so you can make good financial decisions. Number two, after utility is patronage.

I do think that there are people who, like you said, subscribe to the Washington Post because they represented a bulwark against Trump. There are people who subscribe to the bulwark, a literal substack that is anti-Trump, because they want to subsidize or patron that bullwork against the, someone who they see as a despotic terror. The third is entertainment. People pay for entertainment. They pay for video games.

They pay for movies. And I think there's a lot of people who pay for a place like the New York Times because they're paying for gaming, essentially. You know, they want access to the cross-shirt puzzle. Do you think of any other, other than information, sort of emotional or sort of civic patronage and gaming? Would you say those are the three biggest sort of motivations for subscribing? Yeah.

I mean, I guess if there's 3B, it would be just, I. I have a personal connection to the publication that's bigger than simply giving them money. I mean, I would think of publications, right, that have done well in this world we're talking about, this sort of scary media world like the New Yorker, right? People have a connection to the New Yorker that's bigger than I want a nice magazine and digestive think pieces. The ringer, right? You know, people say, oh, those are my friends that host those podcasts. I like the ringer.

I like them. I want to hang out with them, right? the New York Times probably is the one newspaper. Maybe you could argue the post. And the journal with its lifestyle sections, the way it sort of caters to the kind of people are coming there for financial news. There is this element, too, I think of just, I like this publication, like this publication, or at least it's the people that write for it and work for it are my friends.

And I think that's a very indescribable thing, but it is somewhere in that calculus, you mentioned. Ezra Klein, New York Times writer, had an interesting essay this weekend where we pointed out that it is fair to say that there is a lot of death in media. But there's also two polls of success right now. On the one hand, you have the empires succeeding, places like the New York Times. And it seems to me that the Wall Street Journal is doing quite well as well. On the other hand, you have all of these individual newsletters, substacks, whose authors have become quite rich. And so it's like the sole proprietors are often doing quite well, the city-states,

and the empires are doing quite well on the other end of the spectrum. There's a barbell effect. But what you're seeing is not the death of media, it's the death of the middle. Do you agree with that idea? And why do you think we're seeing this death of the middle, where success is just sprinting to either end of that spectrum? I do agree with it. I found that column to be very persuasive.

and I think if we point out a few things like the New Yorker, maybe the Atlantic is in that middle group too, if we consider that to be somewhere between those two polls, those are almost the exceptions that prove the rule. I also think Ezra's point about being where do journalists, where journalists going to go to train to work for the empire is a really good one, because, right, we've had this ladder, you know, and maybe if we can go from Substact to the New York Times,

that's one way to do it. But before you went to St. Petersburg, and you went to Raleigh, and you went to Boston and you worked your way up into the big empire. So I thought that was too. As for causes of that, it's really interesting. I think the timesy sort of gobbling up

of your subscriptions is part of it. I do sort of wonder, I think the middle tier requires you to subscribe to a bunch of things, right? Or maybe read a bunch of things. So then the question becomes, if we're talking to,

not Derek and Brian, but normal person, who's interested in news, who wants to be well-read and smart and all those kind of things, are how many of these things are they actually going to subscribe to, right, in their life? Are we going to get to two? If we get to two, are we going to get to three? You know, or if we get the three substacks in one newspaper, is there anything left for them in the middle? I don't know.

What do you think? The truth is, I don't know. I am really interested in the success of local news. I've talked to some people, this place called State Affairs, that's trying to create a network of essentially individual newsletter writers in various states who do their reporting to create a sustainable business there. I'm really interested in the Baltimore Banner, where my former editor, Bob Cohn, has recently become the CEO,

very enthusiastic about the fact that he's working there. He's really brilliant. But also, I think local news has, I think local news faces a really, really serious problem in that the revenue needed to do the kind of important work that's required to hold local governments to account doesn't seem to match what local readers are willing to pay for it. The advertising market is what it is. I don't know how you fix that.

But I'm concerned that I see a model for one individual great reporter in Durham or Tallahassee being paid, you know, getting 5,000 subscribers, and being able to make a really, really good living by being a good individual reporter, it doesn't seem to me like that model scales very easily. And it seems to me like a lot of people have struggled to make that model scale. And I'm interested in it scaling

because local news is so incredibly important. It's important for rooting out corruption at the local level. But I think it's also important to like a sort of, I think a deeper, like spiritual level and that I think that the nationalization of all news is like civically bad. Nationalized news tends to be polarizing because if we're going to nationalize the news

in order to make it interesting, but you can't make it useful at a local level. Like what's locally useful is like, is this restaurant open or closed. What's useful at the national level tends to be like useful to your amygdala. It's like what makes you fear the world? What makes you hopeful for the world?

And so national news, you can just look at this, look at cable news. it tends to appeal to emotions in a way that I think local news doesn't necessarily have to. So I don't think the nationalization news has been very good in terms of, for political polarization. So I don't know. That's my answer. I'm hopeful that people come up with solutions, but I haven't seen anything that really scales. Is there anything that makes you optimistic at the local level? I'll give you a heartbreak instead of a dose of optimism, but it was the Texas Tribune, you know, which has done such a great job down there.

doing tons of reporting covering my home state so well, and then they went through this round of economic turmoil, what was that at the end of last year? And I think that was one where all of us went, uh, no, no, no, no, you were the model, right? You were, you were supposed to show us the way of how to do this. And at some scale with tons and tons of reporters, right, who are covering everything from the death penalty in Texas to conventional Texas political news. So, you know, I don't, I don't have a great answer. And I think you've hit on the problem, which is just once you start to scale up. Again, you're scaling up, but you're not scaling up like local newspapers once did with all the ornaments on the Christmas tree without the peanuts cartoons and the, you know,

local high school scores and all these other things, right? It's tough. It is tough. Well, Brian Curtis, thank you very much for talking us through it. Hopefully when we have you back, we'll be able to talk to, I don't know, maybe there'll be someone else in the call who actually figured it out and started some incredibly success for local journalism model. That would be a great return. I appreciate it, man, thanks. A new age of news optimism. I love it. Thanks, Darren.

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