Very few businesses invent things.
Readup, unlike Spotify, actually invented something — a completely new business model built on a technology that didn’t exist until we invented it. It improves the experience of reading things online.
In this blog post, I’ll walk you through the innovation that my co-founder and I cooked up, and I’ll explain why I’m going to stop using “Spotify for News” as a way to describe Readup.
The analogy captures a lot of information, which makes introductory conversations much easier: Like Spotify, Readup is also a tech startup in the “media and entertainment” space. Readup is also growing a community and a marketplace in which consumers pay for easier, more direct access to a huge and well-organized library of material. Spotify has users and artists, aka “listeners” and “musicians.” Readup has Readers and Writers.
With just that one analogy, many people can pretty quickly connect the value of Spotify (listen to whatever song or artist you want, whenever you want, free of ads, for a fee) to the value Readup can offer (pay a fee to read whatever you want, whenever you want, without ads).
But that’s basically where the comparison ends. Spotify has, at best, a spotty reputation among musicians. Whether or not they’re destroying the music industry is definitely up for debate. What’s not up for debate is whether or not they’re revitalizing it. Because everyone knows they aren’t.
And so that, Reader, is our primary point of departure from Spotify. Readup is going to have a positive impact on the journalism industry by providing a direct, new revenue stream for writers. And we’re doing it transparently. Someone recently said to me, “It’s like you’re pirating from the advertisers.” Exactly!
Here’s the pitch to Writers:
- Read and reply to comments from verified Readers of your articles.
- Use the Readup integration to grow your Twitter without having to use Twitter.
- Make money every time someone reads something you’ve written to completion, at no cost to you.
And yes, the last one is the best one. Because yes: Free money!
Back to Spotify: They heavily promote free trials. Readup isn’t going to have any kind of free trial. It would undermine our entire purpose. Think about it: Reading on Readup means paying writers. If you don’t pay to read, every time, the Writers can’t get paid, and nothing makes any sense. This is a new-model, more direct transaction between Reader and Writer. We want Readers to feel good about this part of the product. And we want it to feel bad when you circumvent Readup. In that case, you’re back to “paying” advertisers with your distracted, partial-attention. And you’re not paying Writers. Why?
Readers are the ones feeding money into the system, so here’s our pricing strategy: Make it as attractive to Readers as possible. We decided to chop our revenues 50/50 because we want Readers to trust it. Simple and fair are truthworthy. Conveniently, it’s also easy to remember. You might forget 60/40 (or was it 40/60?) but you’ll never forget 50/50.
It’s worth noting that we could have gone the Spotify route: Keeping it all totally opaque so that you don’t even know where your money is going. We also could have just decided to keep all the money.
Or, the opposite end of the spectrum: We could have decided to give one hundred percent of Reader contributions to Writers. We’d still have to subtract (or hide) the Stripe and Apple fees. So the skeptics would still have plenty to complain about. If we transitioned into full-on non-profit mode, that would also mean figuring out how to fund the business with grants from wealthy individuals and foundations. I refuse.
The point is this: What we’re doing — and the way we’re doing it — is completely new. For the first time ever, online Readers will be able to pay the writers they are reading, directly, and visualize, clearly, exactly where all of their money is going. It’s going to feel good to give more and to read more.
To launch, Spotify had to negotiate some massive deals with the big record labels, in order to gain the rights to play songs on the app. Readup is not interested in or even remotely capable of accomplishing this kind of work. It’s simply not who we are. In a different reality, my co-founder and I probably could have raised money on Fake News in order to hire a bunch of suits to strike up sweet deals with the people at outlets like The New Yorker. But, honestly, it probably wouldn’t have worked. On the upside, we don’t have to compromise at all on our fundamentally neutral approach to article curation.
Again, to understand our approach, just imagine the opposite of how Spotify did it. We’re going to appeal directly to Writers (“Free money!” and “Help us save journalism!”) and, pretty much, circumvent “the machine” altogether.
The Spotify app interface is built around Search, which makes perfect sense. You can listen to literally anything on there. Discovery is a second order priority. It’s possible to imagine Spotify without any kind of recommendation algorithms, but it’s not possible to imagine Spotify without super-strong, universal Search.
Readup doesn’t have this functionality. We will one day. In the meantime, I’m concerned that if we over-hype ourselves as “Spotify for News,” people are going to show up (and start paying) with the expectation that they can find anything they want through Readup, even though that’s not exactly how it works.
We don’t prevent you from reading whatever you want, but if you want to read The Wall Street Journal, you need to pay for your own subscription. Readup doesn’t jump paywalls for you. That would be illegal. But, if you’re a WSJ subscriber, you can import WSJ articles to Readup with one click.
Music production is a collaborative art. Writing is a solo endeavor. Even if Spotify wanted to do what we’re doing, it wouldn’t be easy. How would you cut payments to the team of twenty behind the latest hit song? Sounds messy.
I think it’s interesting that Apple News attempted to create a “Spotify for News” experience and branded it as a way to “support” and “help” journalists and the journalism industry, but without any way to actually help journalists or the journalism industry. Oops! And if you’re a media buff, you may remember that The New York Times decided not to play nice which further screwed everything up.
Readup is publisher-agnostic. There won’t be any official way for publishers to partner with us, besides the obvious: We’ll help them to get all of their Writers on Readup, ASAP, so that they can all make more money. Individually, they can get a first-mover advantage and, collectively, a Top Publisher advantage.
It’s all very “grassroots-y,” very “bootstrap-y” and very very fun.
My co-founder and I grew up on Napster and Grooveshark. As former pirates, we’ve been thinking about piracy for decades. We have always known that Readup won’t be successful if we break even the tiniest copyright law. It would be relatively easy to crawl publisher sites, steal articles, and cover our tracks. Maybe. We wouldn’t know because we never even considered it. It’s not worth the risk.
I believe that publishers, quickly, will recognize that (1) We come in peace, and (2) We have a lot to offer. They’ll see Readup for what it is: a safe harbor for all vessels (except advertisers) in the midst of a really crazy storm.
I estimate that by the middle of next year we’ll have statistically significant reading data on the top twenty(ish) articles coming from the top hundred(ish) publishers, as well as the most widely read stories from the thousands of Writers who aren’t affiliated with any publishers at all, like bloggers.
In that case, finding articles and stories on Readup will start feeling like Spotify, like “browsing everything.” In the meantime, we have a pretty awesome sweet spot. These are the current Top Publishers on Readup, as of November 30, 2020:
- The New York Times
- The New Yorker
- The Atlantic
- The Guardian
- The Washington Post
- The Cut
Writers at those publications are likely to get the fattest paychecks when we launch Readup 2.0. We’ll see. A lot of that depends on how well we convert current Readers (from unpaid to paid) and how many “paying newbies” come rushing in. Hopefully tons. And hopefully they have good taste in reading.
Author’s note: I always capitalize Reader when writing about the people who read on Readup. And starting now, I’m also going to capitalize Writer. But ‘publisher’ will stay lowercase. Because publishers are things, not people.