In yesterday’s post, I explained why Medium’s subscription business isn’t sustainable. In essence, it satisfies neither readers nor writers.

I’m a big fan of Medium, and I want it to succeed. That’s why I’m going to share alternative income sources for Medium in this post.

Current Model Is Good for Users But Unsustainable

I’m not motivated by my interests when criticizing the current model and proposing alternatives. The current model is more beneficial for me than the one I suggest.

The current model gives me an excellent, ad-free platform to publish my posts and reach a significant audience. I’m afraid this won’t last long.

I propose a model that is less beneficial for me in the short term, but that will keep Medium afloat longer. That way, it will benefit us, writers and readers, in the long run.

Let’s go over the three alternative income sources for Medium.

Charge Writers for Publishing on Medium

Publishing on Medium is a privilege, and it should be treated as such.

If you charge for the opportunity to post on Medium, writers will approach the platform with greater respect.

Similar to the current system, a writer can publish three posts for free in a given month. That gives an opportunity to everybody to publish on the platform. Anything more than that will require the writer to pay Medium.

Writers would pay Medium for the exposure they get and for the audience they reach. That exposure and audience aren’t available anywhere else for free. It has a value that can be monetized.

What about Comments?

In this system, commenting will be free. If someone wants to publish a 45-minute post as a comment, that’s fine.

If my observations are correct, comments aren’t distributed as widely as standalone posts. Therefore, the writers who publish their posts as comments won’t get as much distribution as the writers who pay the subscription fee.

Charge Writers for Increased Distribution of Their Posts

Medium is a post distribution mechanism.

Writers benefit from getting their posts distributed to a relevant audience. They could increase their benefits by getting their posts distributed to more people. They could pay for that extra distribution.

I assume Medium is considering several criteria when distributing a post to an audience. These criteria might include the engagement of the readers, the tags of the post, the followers of the writer, and so on.

Each criterion has a weight in calculating the relevance score of a post to a reader. The posts with a higher score are displayed in a higher position to a reader.

We can add one more criterion to this overall score: the amount of cash paid by the writer.

I suggest keeping the weight of the distribution fee between 10% and 20% in the overall score of a post. If this weight is lower than 10%, writers won’t find it interesting to pay the distribution fee. If it is above 20%, the overall quality of the platform will suffer.

Sell Privacy Protection Packages

Nowadays, data is a gold mine, and privacy is a problem. In his last post, Ev Williams, CEO of Medium, states that Medium doesn’t sell data to third parties. This is an uncommon practice on the web.

Almost all digital products and services collect user data and sell it to third parties. This practice is a source of income for many websites.

By not selling data to third parties, Medium is benefiting its users. It’s only fair for Medium to charge for that benefit.

As I explained in my post on privacy, I recommend online businesses to offer two types of memberships to their users.

The first type is the free membership. Free memberships are subsidized by selling user data to third parties. This is the current online standard. Most of the websites, products, and services you use on a daily basis are funded with this system.

Privacy Protected Premium Memberships

The second type is a privacy-protected premium membership. In this tier, user data is not sold to third parties, but the user pays for the benefit.

Medium is leaving a lot of money on the table by not collecting and selling data to third parties. This alone could beat the income from their current paid membership model.

It Isn’t Possible to Safeguard Data Anyway

You might oppose this model, but third parties probably collect the data you enter to Medium and sell it further.

If you use Google’s Chrome browser or the Android OS, Google is collecting and commercializing your data anyway, even when you use Medium.

Even if you don’t use Google products, data finds its way to third parties. Here’s an experience I had recently.

My Medium Comment Leaked to YouTube

I access Medium only via Firefox on a Windows PC and Medium’s iOS app. Recently, I added a comment about IKEA to a Medium post. A few hours later, YouTube started to show me IKEA ads on another device.

I have no idea how that data is leaked to Google, but it leaked anyway. Data finds its way to third parties. Why not sell it yourself and charge the people who want to protect their privacy?

Conclusion

Medium’s current subscription-based business model doesn’t seem sustainable in the long run. There are three alternative revenue sources for Medium.

• Charge writers to publish on Medium
• Charge writers to increase their distribution on Medium
• Commercialize the data of the free users and sell privacy protection packages to premium users.

These revenue sources seem to put readers and writers in a disadvantaged position in the short term, but they are more sustainable than the current model in the long run.

If the current model fails, we will lose Medium altogether. Paying for publishing posts, increased distribution, and privacy protection is a small price to pay to keep Medium afloat.

Your Turn

• What do you think about the revenue sources proposed in this post?
• Do you have alternative revenue sources for Medium?

If you look at my archive, you’ll see at least a dozen posts on Medium. Almost all of those posts are praising Medium.

I take Medium seriously, use it as the single source of traffic, and learn a lot of lessons from my Medium stats. It’s an excellent platform for readers, writers, and humanity.

In short, I’m a fan of Medium. Nevertheless, I don’t believe in its business model, and I’ll explain why.

The Number of Paid Memberships Is Growing

In his last post, Ev Williams, CEO of Medium, shares the progress of Medium’s subscription business.

Mr. Williams shares a chart of the daily new members and the total number of members. Both numbers seem to be growing, but there aren’t actual numbers on the chart. We don’t know whether the total number of premium members are 10K, 100K, or 1M.

50K Weekly Writers, 80M Monthly Unique Visitors

Mr. Williams cites other stats. More than 50K writers publish at least once a week on Medium. Medium received more than 80M unique visitors in a recent 30 day period. Those are some strong numbers.

There is a critical question to be asked though.

What is the conversion rate of the 50K writers and 80M unique visitors to premium members?

I don’t know the answer to that question. I don’t think that conversion rate is high enough to sustain Medium in the long run.

Spotify’s Value Proposal

To justify the premium membership model, Mr. Williams mentions other businesses based on similar models. One of his examples is Spotify.

I’m a premium Spotify member since it became available where I live. There’s a huge difference between Spotify’s premium and free offering.

• Ad-free
• Unlimited skips
• Listen offline
• Play any track
• High-quality audio

That difference is worth more than the €100 I pay them every year, especially considering their vast, ever-growing back catalog.

Medium Premium’s Value Proposal

I don’t see a difference that is worth $50 / year between the free and premium versions of Medium.

• Premium posts don’t have marketing messages, not even links to email newsletters.
• You can save stories to an offline reading list.
• There are some commissioned stories.
• You can listen to the audio versions of popular stories.

Medium Premium’s Competition

In the premium content space, Medium’s offering can’t compete with Kindle and Audible as far as I’m concerned.

In the free content space, Medium is the biggest competitor of its own premium membership business. In the free audio segment, there are more than enough quality podcasts.

While trying to prove his case, Mr. Williams is making some sad remarks in his post.

“There is — and probably always will be — a surplus of free content. But that’s like saying there’s a surplus of free food in the dumpster behind the alley.” Ev Williams [1]

“Will people just lower their standards? Perhaps. In fact, our standards have been gradually lowering for years. We’ll read crap on the web we wouldn’t have put up with in print.” Ev Williams [1]

Free Content Isn’t Necessarily Crap

I don’t read “free crap” on the web. The posts that I read on Medium aren’t the content equivalent of the free food in the dumpster.

I always have a Kindle book or an Audible audiobook as an alternative. I read a free Medium post, because I think I’m going to get something out of it. The cost of a Kindle book is irrelevant to me compared to the time I invest in it.

Who decides that the premium content on Medium is better than the free content on Medium? What is the decision criteria?

A Medium post is premium, because its author decided so. Outside of the no marketing rule, there are no criteria that separate a premium post from a free post, as far as I can see.

What’s the motivation to provide outstanding content on Medium?

A writer can have several motivations.

• Spread ideas.
• Get some exposure.
• Build an audience.
• Market products or services.
• Make some money.

A paid membership website isn’t the best way to spread your ideas, get exposure, and build an audience. Marketing isn’t welcome in premium posts. Money isn’t significant either.

“In February 2018, 56% of authors who published at least one story for members earned money — making $58.45 on average for the month.” Medium Marketing Message [2]

Sure someone made $9K in a month, and a post made $1K, but those figures are possibly outliers. They probably don’t represent a reliable income. If I were that writer, I wouldn’t get a mortgage counting on that $9K monthly income.

Buy a Membership to Support Medium

You might argue that you have a Medium membership, because you want to support Medium’s cause. I acknowledge that. I donated to Wikipedia and other non-profits in the past.

I could buy a Medium membership to support it. However, that’s not the point. Medium doesn’t ask us to donate them money.

Medium is trying to sell us something as a for-profit company. There’s nothing wrong with that. I evaluate Medium as a commercial product, not as a non-profit.

Conclusion

Medium’s premium program doesn’t provide sufficient value to the consumers. It doesn’t offer enough value to the writers either.

If the subscription model can’t satisfy the primary stakeholders, how is it going to become a sustainable business?

The subscription model doesn’t convince me, but there are other business models that Medium can use. I’m going to publish a post about one of them tomorrow.

Your Turn

• What do you think about Medium’s subscription-based business model?
• Are you a premium member?
• If so, what made you a premium member?
• If not, what keeps you from becoming a premium member?