MEDIA'S YEAR OF LIVING DANGEROUSLY

SUBTOGRAPHY 101

Happy New Year War & Peaceniks! Welcome to Subtograhy 101.

Over the last year, I have dedicated a lot of time to the study of the mind of the Modern Media Subscriber - digging through Antenna data to monitor SVOD Churn, reading Spotify’s earnings each quarter to measure the plateauing of their subscriptions, and fielding a study of more than fifteen thousand American Media subscribers with Publishers Clearinghouse to understand what consumers will pay for and why. Why? More than any point, the behavior of Media Subscribers charts the course of the Media Universe.

When Cable first appeared, people thought paying for TV was silly. The same can be said for bottled water. Now we readily pay for both without a thought.

Even after YouTube made video free, Netflix cut the knees out of Pay TV bundle economics, and cord cutting became the public vernacular, people still paid for (subscribed to) TV - more of them every year. What’s more, ever since Spotify, people have subscribed to music - something readily available for free on the Radio. Now, even gamers are subscribing to play on platforms from Microsoft, Sony, Apple, Amazon, NVIDIA, Valve, and Epic.

But despite Cable’s long subscription history (subscristory?) the modern Media subscription economy is relatively young and immature. Not very long ago, we were still buying and selling DVDs; downloading music by the song; and sticking cartridges in our consoles. Amazon Prime didn’t launch until 2005; the NY Times didn’t launch paid digital subscriptions until 2011; Spotify didn’t launch paid subscriptions in the US until 2012; Apple Music didn’t launch until 2015; Microsoft didn’t launch GamePass until 2015; Epic only launched their Game Store in 2018; and it wasn’t until the fourth quarter of 2019 that Hollywood’s traditional Media establishment entered the D2C subscription marketplace.

Then, just as subscriptions became the “It Revenue Stream,” 2022 happened.

Netflix hit a wall; Churn finally became a focus; and everyone in Media started to question the underlying fundamentals of the subscription economy. But, let me remind you - the Modern Media Subscription (especially for platforms beyond TV) is still a very immature product. Consumers are still figuring out their subscription diets. Platforms are jiggering and rejiggering subscription plans like the chalkboard at a neighborhood deli. And now advertising (that old standard which created the 20th Century Media economy in the first place) is making a BIG comeback - sticking its nose super deep into the sub biz.

While there are comps to consider, there is no real history to study for insights on how consumers will react to the chaotic cornucopia of content constructs coming fast and furious at them in 2023.

FREE is the new paid, except when it isn’t. Paid now has ads, except when it doesn’t. I can sign-up in seconds, and cancel when I’m done my binge. Changing the channel on Pay TV has evolved into Serial Churning, and my free home shopping now comes with reading, TV, Music and Gaming. Even the Mad ad biz now relies heavily on Subscriber behavior for its impressions. Ergo, understanding why today’s Subscribers sign-up, cancel, downgrade, or step-up; is key to seeing where Media is headed.

So, this year, in addition to my usual Media Cartography, I resolve to dedicate myself to the field of Subtography: The ebb and flow of Modern Media Subscribers, across all sectors of the Media Economy.

Today’s study: Subs & Ads.

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