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The Digiday Podcast
AI-powered paywalls and the Trump Bump: A look inside the state of the publishing business
00:53:29
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- [00:00]
Kamika McCoy
Foreign.
- [00:10]
Sarah Jordy
Hello and welcome to another episode of the Digiday Podcast, a show about the business of media and marketing. I'm Kamika McCoy, senior marketing reporter here at Digiday. My co host, Tim Peterson is in Vail, Colorado right now for the Digiday Publishing Summit. More on that later. In this episode, Tim has a conversation with two of our Digiday colleagues, that is Alexander Lee and Sarah Guaglioni, about some things that they're looking forward to getting into at the summit this week. There will also be a check in on the state of the publishing industry at large. So stay tuned for that a little later. But first we're going to talk about this week's Juicy Scoops. And for that I am joined by none other than Digiday's managing editor, Sarah Jordy. Hi Sarah. Welcome to the podcast.
- [00:50]
Sarah Guaglioni
Hi. How's it going?
- [00:51]
Sarah Jordy
It's going good. How did you spend your weekend? Did you watch anything juicy? I saw a ton of spoilers for Severance, although I don't know if they'd be sub spoilers for me because I struggle to be a TV girly. What about you?
- [01:04]
Sarah Guaglioni
You know, absolutely same. I've seen that severance is something that I need to be watching and so I have like a ton of videos saved to watch if I ever do turn it on. But Unfortunately I watch TikTok like TV. So I spend my quiet hours just mindlessly scrolling. I think like a lot of us, I love that.
- [01:23]
Sarah Jordy
And I am also in the same boat. So that is actually just one of our Juicy Scoops is about Apple TVs. I should have started with this, but Severance is on Apple tv, which the streaming app is currently losing money. And we'll talk about that a little bit in this episode. That's one of our Juicy Scoops. Also in our Juicy Scoops, Ben and Jerry's in the outing of its CEO. And then finally a TikTok update, which is I guess a countdown. We're about 11 days out from it going into effect. So back to Apple tv. There are the information. Recently reported that the streaming platform is losing more than $1 billion annually on its Teaming streaming TV streaming service. Excuse me. And has begun more closely to scrutinize its costs. Talk to me a little bit about your streaming habits. Is Apple TV in there?
- [02:12]
Sarah Guaglioni
Apple TV is not in there, but I am a Netflix and HBO now. Max, girly, I think that I am just not a good consumer of television. You could brand me, I simply just don't watch it. But I like to be on top of trends. And so I like to stay relevant by talking to my friends about what they're watching. And are you an Apple tv?
- [02:36]
Sarah Jordy
I'm not. And here's the thing. I think what's interesting is that Apple is kind of like one of the last bastions for non ad supported content, right? Like you pay your, you pay your ticket, your, your, your entry free and you don't have to watch ads. But the question is like, is their subscriber base enough to keep the business afloat? Right. So they were spending at one point around 4.5 billion on content annually and that's down from 5 billion in past years. Given in the, the grand scheme of Apple's business, right. One billion is kind of, you know, a drop in the pot. Drop in the, drop in the hat. It's one of the biggest companies in the entire world. Globally, they generated $391 billion in revenue and posted a net profit of 93.7 billion for its fiscal year, which ended last. So, you know, how much do they actually care about losing money? I almost wonder if it's like Costco chicken where they are very aware that they're losing money on the rotisserie chicken, but for the, for the, for the sake of diversification, right? It's the, the Costco chicken in the back. And I wonder if that's like apples, apples, Costco chicken.
- [03:41]
Sarah Guaglioni
But I'm curious too, how, you know, I don't know how you feel about this, but I am pro ads. Like I don't mind spending less if it means I'll have a 32nd, 60 second ad break in the middle of my programs. And so I'm wondering too, especially if the economy continues to do what the economy is doing and wallets theoretically are pinched a little bit more, if we're going to see more consumers like have that perspective, you know, are they going to necessarily care if their ads are not? And then how is that going to affect the streaming wars? I don't know. I think that'll be interesting to watch.
- [04:13]
Sarah Jordy
And it also brings up this question like, so at this point, I think like late last year, several of the streaming platforms started to report that they were seeing some profitability. I think you had like Disney's, which is Disney, Hulu and SPN generated a quarterly profit of 47 million, reported late October last year. Netflix, obviously, as you know, that's one that's reported profitability at this point. And then in August it was Warner Brothers Discovery. I can never remember their name because they change it all The Time Warner Bros. Discovery in Paramount Global that also said that they had become, you know, profitability. So the question here becomes like, you know, to get to profitability, is Apple then kind of in this predicament where it has to learn the same lesson as other streaming services where they add ads? Because Netflix was in the same predicament a couple years ago. No.
- [05:02]
Sarah Guaglioni
Yeah. And they had the audience and so it was like a chicken before the egg situation. Are you an ads person, pro ads, or how do you feel about the model?
- [05:11]
Sarah Jordy
No, I'm. Because it's the same thing as like watching TV when I was a kid, right. Like I knew when I had my ad breaks and like that's when I got to go like, I don't know, take my bathroom break, grab my snack, whatever the case may be, as opposed to having to be like eyes glued to the screen for, you know, an hour and a half straight. So to me it works. But it'll be curious to kind of see how they go forward because there was a big hoopla around like Netflix adding ads for people because they weren't accustomed to it on that platform. I paid my money. I don't want to have to be subjected to ads. But it seems like given their reporting, as much as there was raised voices, you know, it wasn't, it wasn't a bad business move. So I'm curious if Apple will make the same thing.
- [05:49]
Sarah Guaglioni
Yeah, it is interesting too because we talk about all these short form video apps changing our attention spans, but I was the exact same way growing up. Not to date ourselves, but we're solidly in the millennial camp. But it was the time when the ad came on to catch a snack, close your brain down for a second. So we have always been operating in 20 minute, 30 minute snippets in terms of consuming program. It doesn't really feel all that different to say that we have shorter attention spans now. But that said, you know, Gen Z has very different viewing habits than we do. You know, they do not remember a time without the Internet, which is really scary to say. So they're like brains are probably formed completely differently than ours. All this to say how much too then will these streaming companies cater to that younger demographic is something that they have to be working through.
- [06:36]
Sarah Jordy
Yeah, I think there's a trade off there and Apple will be facing that. Right. And like I said at the beginning of this conversation, they are the only or one of the only major streaming services to not offer a cheaper ad supported tier. So not only in the sense of like ad revenue, but also to your point about viewers, if you don't have that option with that kind of, I don't know, the tightening of the purse strings for people that, that becomes then the question of how do you attract that audience? Especially when you're competing with like the tubies of the world. Right. Which are also growing like super rapidly. Their base prices, their base price is $10. So the question becomes like, how much cheaper can they go? But to me the answer is free. And that's what I get with tubi.
- [07:18]
Sarah Guaglioni
So. Well, I think you also have to consider here the like prestige of what they're trying to do by making their brand ad free. And I would compare that to like the media world, these brands who are sort of running on this idea of prestige. Yeah. You know, like the Conde Nast of the world who for years just have this reputation of being the glossy title. So I also too wonder how much that is going for them. But also like, do people still care about stuff like that anymore? You know, like, so I don't really know. I don't know.
- [07:53]
Sarah Jordy
That's actually a very good question because like, even when you talk about like their content production, right. Like an Apple TV original severance versus like a. To be original. Like you're talking about like the quality there and like, you know, that level of production versus to me when I watch to be a lot of it's like Hallmark style for their original content. So that also is a question that people are willing to pay. So as we end all conversations, all juicy scoops on this podcast, it's a we'll see moment. Next up on our list is Ben and Jerry's. I would ask if you're an ice cream person, but we've eaten ice cream together several times, so I know that to be a fact.
- [08:30]
Sarah Guaglioni
Yeah, it's one of my favorite food groups.
- [08:33]
Sarah Jordy
Yeah. At the, at the very bottom actually. So flip that pyramid for me and you'll find ice cream at the bottom at all times. But Ben and Jerry's recently is accusing its parent company Unilever of firing its CEO in retaliation of the company's social media activism. Which says a lot because Ben and Jerry's has been active socially for a long time, even back to like, you know, the, the post murder of George Floyd. They were pretty vocal about that and several other things. So this is the latest move in a long running conflict between Ben and Jerry's and Unilever. So last November, the company and five directors of its independent board sued Unilever and its U. S subsidiary and federal court alleging that the companies had silenced Ben Jerry's attempts to show public support for Palestinian refugees, among other causes. Which is, like I said, a lot, because Ben and Jerry's has always been vocal. No, Yeah.
- [09:30]
Sarah Guaglioni
I would put Ben and Jerry's with this group of brands that have always taken, like, more social justice issues. Taking on more social justice issues. I would put Patagonia in this camp, too. Arielle Yeti. Yeah, exactly like that group of brands.
- [09:45]
Sarah Jordy
Yeah, they've. And I think what makes this culturally relevant right now is that Ben and Jerry's is. Well, actually, let me back up and give the history real quick. Right. Ben and Jerry's alleged that Unilever prevented the ice cream brand from issuing post comments on Black History Month supporting Columbia University graduate Mahmoud Khalil, which, if you remember, is the US Legal permanent resident who was attained this month after helping lead pro Palestinian demonstrations last year. But I think this all kind of ties into this idea of where brands are allowed, right, to participate in culture. Because at this point, so much of culture has become political. And to see Ben and Jerry's kind of had this point of contention really speaks to, like, I guess, how much where brands are allowed to, like I said, show up in this space.
- [10:35]
Sarah Guaglioni
Yeah. A tough question that you've reported on extensively this year. And I guess it's a question that I, as, like, a voter and like a person of society also, I'm sort of grappling with, like, I don't know, the areas in which we as consumers and humans really agree on anymore. And I have to imagine that being able to market and establish brand values around particular issues is really difficult because there is no sort of North Star anymore. And you've talked about how this was sort of all thrown out the window before the election. So it's not even really timed to the presidential election. More so just where we are in terms of brands and the pressure to be authentic and have values. I mean, do you think that there is more pressure now or less pressure? Why are brands, I think, having these.
- [11:23]
Sarah Jordy
Thoughts now, I will absolutely say, like, it was one thing to have, like, pressure from consumers. Right. But it's another thing to have, like, I'll. I almost say, like, when the Trump administration came in, there were already those mounting pressures from consumers. Right. Fear of backlash and whatnot. But I think what happened is that you had a. When federal mandates came down, kind of, you know, dismantling the ENI that threw gasoline on what was already a fire. Right? Now, I will say that Ben And Jerry's said that the actions of its parent company violate its merger agreement. You know, as this merger was coming to a head, Ben and Jerry's said, hey, we have a mission that we stick to, and this cannot happen without, you know, our. You could call them famously progressive politics. But I do think, like I said, and I've said this from the very beginning, that brands are going to struggle to continue to keep up in this space because culture is becoming, like, it's one thing to celebrate Women's History Month, but when you have women's reproductive rights on the table, like, how do you then show up in that space authentically as a brand? Right? And I think that now becomes the question for a lot of brands. So the same thing with Target, you know, who's facing pushback right now, where a couple years ago they made really big announcements about bringing in, like, black suppliers and diverse communities and whatnot. And now that, you know, that shape shifting has happened because there's pressures that are then happening.
- [12:40]
Sarah Guaglioni
I just want to go back to your one example, though, real quick. You said it's one thing to celebrate Women's History Month. It's another to acknowledge women's reproductive rights. And so is it, though, you know, like, is that what brands are weighing? Can you, in fact, establish and respect women by acknowledging the celebratory month without acknowledging that they deserve reproductive rights? It's very, I think, somewhat confusing time to navigate. So, you know, I think for me, this brings up the question and, like, this is a really important example, even though there's sort of a messiness between the parent company and them as a brand. But to your point, like, we are in this era, perhaps of reexamining language and reexamining what issues, whether you consider them political or social issues to stand behind. And I think one of the really interesting things that we've dissected both in our reporting and just in everyday conversations, you know, internally. But the difference in this, the distinction between DEI as an issue and multicultural marketing as an issue, and what falls into either bucket, what falls into both, Perhaps this is, like, going too deep and existential about it, but I think that we are, in this point of examining what language means and what we should stand for. And maybe that is a reckoning that we have needed to make all along. I don't know. Am I just trying to make the glass half full and it's like, there's no water in it? Stop. You need to call me out on these things.
- [14:13]
Sarah Jordy
I respect you for that, but I do Think to that point, two narratives that are showing up in my reporting is the first one is, like, I want to say maybe last. The week before last week, I wrote a story and, like, the head was like, don't say de And I, like, I talked to a multicultural marketer who said, like, in the campaigns, as we're moving forward, whether it be for Pride Month, Black History Month, whatever the case may be, I don't, as a client, telling the agency I don't want D and I included in this. This campaign narrative that I'm creating. Right. It's not necessarily that, like, there's been a total, total dismantling, you know, like, brick by brick. We don't want anything to do with diversity anymore. It's a rebranding to some, depending on who you ask. Right. So that's part of it. Even if you talk about, like, Women's History Month, International Women's Day, I've been seeing pitches in my inbox that are focused less on, you know, women's rights, like, they would have been a couple of years ago, and now more focused on, like, female founder stories. Right. So again, it goes back to, like, the language concept that you're talking about where I can't afford to alienate completely the left or the right, you know, regardless of where you fall on the political spectrum, like, I need to find a way as a brand to appeal to everyone. And I will say that's getting harder to do.
- [15:26]
Sarah Guaglioni
And what you're saying as we talk it out loud sounds more like survival than it does like a rebrand for rebrand sake. And then I think you have to acknowledge intention. And so is it really, you know, goodwill toward changing our language to match our intention, or is it simply surviving in this era that we find ourselves in politically and socially?
- [15:49]
Sarah Jordy
I think that's a very good question and something that I'll invite our listeners to sit with as we move on to our next topic. So the last juicy scoop that we have for you guys today is a Tick Tock update. I am thinking about these things as a countdown until we get, well here, an alleged countdown, because Trump has also floated the idea of once again extending this ban. So we're not sure, but I think last episode we had me, Crystal and Tim all vying for who we thought made the most sense to buy Tick Tock and become the new parent company. Tim made the case for Oracle, and I feel like that made a lot of sense given the most recent news, which Oracle has kind of revealed itself to be a front runner in the potential TikTok deal. So give me. Give me your thoughts on Oracle buying this. They've already managed the data here, so, like, it makes sense to Tim's point, but, you know, that means. No, that means Mr. Beast will not be handling this project, as far as we know.
- [16:52]
Sarah Guaglioni
Yeah, I mean, I think it makes sense on paper, but I'm also skeptical about this process to begin with. I'm sure, you know, as you've talked about it and have, and Kristal has reported on it, but the ban coming about when it did, right as Trump was taking office, I think ultimately the deal is going to result in what looks best for the Trump presidency. I feel like that's where we're at. And so whatever the headline comes out of it, I'm sure President Trump will take whatever positive coverage he can get because it fits the narrative that he has, quote, unquote, saved Tick Tock. Even though, you know, this has been in place for a really long time now.
- [17:36]
Sarah Jordy
This is all also up in the air because once again, it's unclear if the Tick Tock ban will go into effect because I think it was pushed back originally to April 5th. I don't remember what the original deadline was before that, but, you know, this is something that the administration has been kind of like. Not even just this administration has been kicking the can down the road because it goes back to Trump's first presidency, actually, when there was a TikTok ban. So who's to say that any of this comes through but Perplexity, the AI tech startup, has also proposed a bid, I think, since Friday, that they want to rebuild the TikTok algorithm. Because, mind you, part of the contention is that if TikTok is sold, the algorithm will be lost. And then it's, you know, is it then Tick Tock at that point? Right.
- [18:24]
Sarah Guaglioni
And is it useful as a tool 100?
- [18:27]
Sarah Jordy
Because the whole thing is about it being able to go viral. And, you know, if you no longer have that, what separates you from Instagram, which I'm sure Zuckerberg goes to sleep at night thinking about, but nonetheless.
- [18:39]
Alexander Lee
Also.
- [18:39]
Sarah Jordy
The question is, like, how much data does Perplexity have to be able to fuel this thing? Right?
- [18:45]
Sarah Guaglioni
Yeah, I don't. I guess I'm just cynical. I'm not speaking clearly of any more coffee. I am cynical that this is actually gonna happen at all. And I feel like the industry. I mean, you tell me, but it feels like the industry is not acknowledging that this is actually right around the corner. In a way that makes me skeptical, too, that you Know, like, how much do people care that it would actually go away and like there'd be a real ban. When the ban first went into place, which I think was President's Day weekend, I remember there was a lot of chatter and people shared on other social media platforms like, oh my God, I got served that message. Check back in once Trump takes office and then we'll see what happens to the app. But I don't feel like there was much of a response from the marketing community about actual contingency plans. There was a lot of like, well, quote unquote, wait and see what that looks like. There is acknowledgement of what viral moments could look like without TikTok, but I think they haven't been really pressured to come up with tangible use for their.
- [19:54]
Sarah Jordy
Dollars to go elsewhere to that point. Crystal reported recently that actually TikTok ad prices have fallen. As you know, the platform is enshrouded in uncertainty and some advertisers are walking away right for as much back and forth. And advertisers have been kind of operating in the gray area as it relates to ad spend on this platform. That trend seems to continue as Chris kind of reports that advertisers are split on whether to double down on it or cash out on TikTok's future. Now, mind you, tick tock, I said that it will reimburse. But to Crystal's point, last time she was on the podcast might be living out of hope and a prayer because they said, you know, we'll, we'll do an iou, but that wasn't written down on paper to be able to make that. But you know, CPMs on the app have declined, as Crystal reports, 80% between January of last year and this January. So, you know, it could be weak, demands, different competition. But it's really hard to ignore what she reports to the elephant in the room, which is the TikTok band. So, you know, we're, I think we're starting to see some movement. But still this is as we're 11 days away at this point, allegedly. There's more again questions than there are answers completely.
- [21:10]
Sarah Guaglioni
My biggest question is what I'm going to watch in the evenings when TikTok goes away because that's, that's my like 7 to 10pm slot, you know, 100%.
- [21:20]
Sarah Jordy
That's my non verbal time. I actually refuse to watch Law and Order on the big screen TV. I am watching reruns on TikTok where the comments say chop chop, movie boy. So I don't know, I don't know either.
- [21:34]
Sarah Guaglioni
I We'll have to change our sign off to each other though. Should TikTok actually be banned from see you on TikTok because then it will no longer be legitimate.
- [21:42]
Sarah Jordy
Hate that for us. Hate that for us. But to your point about the cup being half empty for this one, I I I'd be curious. I'd be surprised if that band has not been extended for an up teent time. So as with all things, we'll see.
- [21:59]
Sarah Guaglioni
We'll see. And maybe that's why marketers are being so hesitant to actually commit to something because they don't need to. You know, maybe they are seeing the writing on the wall just like we are and saying it's not an issue yet. But you know, like you said, it's 11 days out, so get it together.
- [22:12]
Sarah Jordy
Absolutely. Well, Sarah Jordy, thank you so much again. Our managing editor for joining this podcast. Later this episode, Tim Peterson, again, who is in Vail, Colorado right now for the Digiday Publishing Summit, is joined by Alexander Lee and Sarah Guaglione to talk about some things that they're looking forward to at the summit, as well as a check in on the state of the publishing industry at large. So with no further ado, we'll get to it.
- [22:47]
Tim Peterson
What's up, Sarah and Alex, welcome to the show. Thanks for joining.
- [22:50]
Kamika McCoy
Thanks for having me.
- [22:51]
Alexander Lee
Thanks for having us.
- [22:53]
Tim Peterson
Absolutely. Glad to have you. Because we're going to be the 3 of us spending a lot more time together by the time this episode's rolled out. Because this week, the week that this episode will air, is the first Digiday Publishing Summit of the year, our annual one in Vail, Colorado, which I'm expecting to be fairly chilly, and that's probably fairly appropriate for some parts of the state of the media industry this year. But I'm really looking forward to this year's Publishing Summit because as usual, it feels like we're going to be having plenty to be talking about. How are you both feeling headed into dps? Sarah, let's start with you.
- [23:32]
Alexander Lee
Yeah, I'm feeling good. It's my first DPS since this time last year when I was at Vail. I was on maternity leave during DPS Miami. So I'm excited to get back out there, see some familiar faces, hear what's going on in Q1, and I feel like, you know, on your point, that things are chilly, I think some things are thawing this year. So I'm excited to hear more about that too.
- [24:00]
Tim Peterson
Yeah, we'll get into that. And I imagine there are going to be folks excited to see you because I know at DPS last September in Key Biscayne, there were a couple of people who came up to me and were just like, where's Sarah? Asking about you. So I imagine those are probably like dps Die Hard. So you'll be there next week. Whereas Alex, you have not been to a DPS before. So how are you feeling heading into your first?
- [24:22]
Sarah Jordy
Yeah.
- [24:23]
Kamika McCoy
So for those of you who are not familiar with me, I was actually Digiday's gaming and esports reporter for about three years and I was reassigned to cover media and entertainment, particularly through the lens of content creators at the beginning of this year. So this is my first ever dps. I have done Digiday's gaming events in the past and so I'm excited to get back in the saddle for that, but I'm just really excited to see what dejoday's in person events are like. And for me personally, I'm a skier, so I'm going out a little early to get a ski day, so particularly excited about that too.
- [24:55]
Tim Peterson
Nice. I'll enjoy that. Yeah. So for anyone who won't be able to join us in Vail this week for DPS or who is there but maybe is dipping out to hit the slopes like Alex is going to be doing ahead of the summit, one thing we do during the Digiday Publishing Summit is present what we call the state of the industry. So I figure, let me tease that out here for the listeners. I think that'll also help to kind of tee up the conversation the three of us are about to have. So I've came up with five points to distill the state of the industry. I doubt, I'm sure these are all gross oversimplifications, but this is the best secondary. The media industry is very large, but one is AI has become a real part of many publishers, businesses and operations. I think we're going to have a number of sessions in which we're covering how publishers, publishers will be breaking down, how they're actually using AI as part of their businesses or have developed products oriented around AI. Volatile platform referral traffic continues to be a conundrum. This is something that Sarah, you've been reporting a lot about in the past year and I imagine a lot of the conversations during DPS will be on this topic. Third point, this year must see a growth spurt for streaming's programmatic infrastructure. So I'm going to have two sessions that are related to streaming advertising and Programmatic is going to be a big piece of that because with more live sports becoming available to stream, that's an opportunity for that ad inventory to be sold programmatically. But that's very high value inventory. And so the programmatic pipes need to be cleaned up a bit to be able to handle that inventory. We need some copper, copper pipes for that inventory. Point number four, increased advertiser scrutiny on ad tech fees and murky supply chains can create an opportunity for publishers to deal more directly with the buy side and offset a weak open market. This is something that Seb Joseph, our executive editor of News, as well as Ronan Shields, our senior ad tech reporter, have been reporting on fairly extensively recently. Just the state of the programmatic open market, but then also how much scrutiny is there is from advertisers into the fees that ad tech intermediaries are taking. So that I'm really, I think the town halls in particular generally we have a lot of programmatic related discussion at dps and I'm guessing these could be big talking points, although there's so much else to be talking about. For example, point number five, is the industry entering a recession or should we call it a period of challenging macroeconomic conditions? This is. This has started to bubble up with all the tariff stuff. And I think coming off of what seemed to be a fairly healthy Q4. Sarah, you just did the media briefing. Recapping the most recent earnings reports from publicly traded publishers. Seems like Q4 was not horrible. It was fairly positive, I think for a lot of publishers. And maybe Q1 has been okay as well, maybe not so much. But it seems like it's a question mark how Q2, Q3, Q4 are going to be. So that's our state of the industry. Sarah, I want to get your take on point number two. Volatile platform referral traffic continues to be a conundrum. What is it that you're hearing? Because you've been reporting on kind of some recent changes in platform referral traffic. So volatile makes it sound like it's a bad thing and like all negative. That's not necessarily the case.
- [28:34]
Alexander Lee
Yeah, it's really interesting. Basically, for the last couple of years when I've covered platform referral traffic, it's been really depressing. You know, like traffic from platforms like Facebook and formerly Twitter used to drive a decent amount of audiences to publisher sites. And as most of us know that a huge chunk of that disappeared pretty much overnight, like years ago and never really came back. And it's just been a pretty steady decline over the past few years. There have Been some bright spots right. At past DPS events. Publishers have talked about Google Discover being a place, a good place for driving some traffic, even though that's extremely volatile as well and not something to rely on. But it's really interesting. Last couple weeks I've been talking to some publishers about what they're seeing this year and it seems like referral traffic is actually starting to come back. I had one publishing exec who literally told me social traffic is back. They'd seen their biggest day of social referral traffic last week in at least the past five years. That was as far as they look back in their data.
- [30:00]
Tim Peterson
Okay.
- [30:01]
Alexander Lee
And so it seems like things are coming back. It's honestly hard for me to really believe.
- [30:06]
Tim Peterson
I feel like it's gonna say famous last word. Social referral traffic is back.
- [30:09]
Alexander Lee
Yeah, it's like, you know, the boyfriend that like keeps dumping you and then coming back. It kind of feels like that. So yeah, I'm so I'm very excited to be at DPS and hear from people about what they're seeing because this also isn't across the board. I talked to many publishers that also said things are trending as normal. Nothing super exciting to see. So I'm curious to hear if this is something that is dependent on what type of publisher you are, what type of content you're posting on these platforms, what type of coverage is coming out. So we'll see.
- [30:52]
Tim Peterson
Yeah. And also like which platforms because, well, as you're saying it seems to be primarily social platforms. But the day we're recording this Friday, March 21st, Google put out a blog post that I would imagine was kind of a bomb in a lot of publishers, especially news publishers inboxes, where Google said, hey, so we did this test in Europe where we just removed news publisher links from search results and you know what happened? We didn't see any impact on Google's own ad revenue, which is probably not what you want to hear if you're one of the new European news publishers. Now again, this was just a test. It's not Google necessarily saying they're going to remove news publishers from search results in Europe or anywhere else, but it did strike me as a bit of. So European news publishers or news publishers in general, like play nice with us because we don't really actually need you for ad revenue. So I'm very interested to like amid all the other referral traffic related questions we have going in dps, but like how that one is going to be going over has gone over with the folks that we're going to have on site.
- [32:08]
Alexander Lee
Yeah, I can imagine that. That's super scary. Yeah. And that makes sense because I think I was telling you there was a publishing exec that was telling me a couple weeks ago that they were starting to feel very nervous about something that was happening with Google Search, at least in the uk. So maybe it's something related to that. Scary?
- [32:30]
Tim Peterson
It could be, yeah. I don't know. I don't know to what extent Google for this test respected Brexit or not when it comes to like how it looks at Europe. But I mean, it was about a year ago this time when Google had made another big search update that was throwing publishers for a loop because I remember DPS last year hearing from some publishers who could not talk enough about the fluctuations they were seeing with Google Search. So we'll have to see. Alex, is there anything in particular you're particularly stoked to be talking to folks about during DPS this year?
- [33:02]
Kamika McCoy
So I don't know if I would use the word stoked necessarily, but one sort of informal other state of the industry theme that I anticipate coming up a lot in the sessions is the current political state of affairs in America and the impact of everything happening on the news business. I know in that little old question of journalistic ethics, democracy, free speech. But these are all topics that came up pretty heavily in the calls that I had with some of the folks I'll be speaking to just to prepare for our sessions. So I am doing a session with the BBC and I'm doing a session with the Economist, both of these sessions. And I think also Sarah, the one that you are doing with the Guardian, touch on the role of a non American news organization that is making an effort to build its presence in the United States at the same time that all of these questions about freedom of the press and freedom of speech are becoming very relevant to journalists and just people in this country across the board. And so both in my conversations with the Economist and the BBC, we talked about the responsibility but also the opportunity for these publications to help readers find their place and just make sense of this increasingly complicated political environment. Also with the advantage of speaking from the remove of not being an American news organization. All of these publications that we are speaking to I anticipate are probably experiencing something of a Trump bump, the way that we saw publications experience increase in traffic in the past Trump administration. And so I don't want to start drooling when I'm talking about this, but I do think that this creates new opportunities. For example, a publication like the Economist to reach new audiences. So the session that I'm going to be doing with the Economist touches on a brand marketing campaign they've been doing over the past year to sort of reintroduce the Economist to a younger, digital first audience. And so I anticipate that the question of how do we talk about Trump, how do we talk about current events in America, will be really important to that kind of broader brand refresh that the Economist is doing.
- [35:14]
Tim Peterson
Right. And then also, how do you get subscribers, especially if people are feeling a bit more strapped for cash these days? Especially like, just with everything that's been going on with publishers and paywalls? Like, Sarah, you've been doing some reporting around paywalls. You also, as part of your earnings recap, reported on how the Times and the Dow Jones subscription business are doing. So. Yeah, that's going to be an interesting one. Sarah, what have you been reporting on with respect to paywalls and subscriptions?
- [35:44]
Alexander Lee
Yeah, it's really interesting to think about that in the context of the current administration, because especially around the drama around endorsing a presidential candidate last year, it was interesting to see some publishers take advantage of that moment and really use it as an opportunity to drive reader revenue. So, for example, the Guardian, who I will be speaking to on stage at gps, talked about how they use some of the messaging around endorsing a presidential candidate, not Trump, as a way to bring in more revenue. And they brought in record amounts of revenue from that and really continuing to use that messaging to bring in more money. They don't have a paywall or subscription, but it is revenue from readership. Right. And being very open about that. For example, one of the messages that they were using was around how CEOs like Jeff Bezos, who owns the Washington Post, was being friendly towards Trump. And the Guardian had some messaging around, we don't want to be your friend to the administration because they see their role as you want to hold an administration to account, not be friendly with them. So it'll be interesting to hear how other publishers are dealing with that, because then you have the Washington Post for Trump's first administration, came out with their slogan, democracy dies in darkness. We're not seeing that kind of narrative from them anymore. So I think it will be really interesting to see that in terms of paywalls, there's a lot happening around testing different types of paywalls using machine learning and AI, of course.
- [37:40]
Tim Peterson
Gotta do it.
- [37:41]
Alexander Lee
Another word for AI, basically. Yeah, using, I would say, advanced technology essentially, to really Boost paywalls. So dynamic paywalls take in a lot of data, as much as they can from readers, where they're coming from, how often they visit the site, things like that, and basically calculate how likely they are to subscribe and then depending on that, show them a paywall. Right. And, and now that machine learning AI technology has become a lot more advanced and I think really accessible to some of these publishers, they've been layering that into their dynamic paywalls to really improve them and honestly just make their paywall smarter. And it sounds like this is working well for some publishers. And it sounds like a few publishers have said, we can't talk about this publicly with me, but they are testing a lot of this behind the scenes. So I think in the next couple of months we're going to see a lot more happening in the space. So hopefully something that people will be willing to talk about at DPS too.
- [38:46]
Tim Peterson
Yeah, no, I mean, that's one of the things I'm particularly interested with DPS. This spring edition is the past four or five DPSs. It feels like AI has been a growing part of the conversation, but it still had been people trying to figure out what they want to do or to what extent they're allowed to do anything with AI. Whereas this time around it feels like we're going to have more conversations of like, you know, I'm going to be talking with Rachel Schindler from Punchbowl News and we're going to be talking about what they've been doing with En Bloc AI, which is their AI technology that they've been rolling out as, you know, part of a subscription product. And so she's going to be able to, you know, break down the mechanics of that whole development process and you know, what impact it's had on their business, which I think is going to be really interesting. So it's like, okay, finally we're going to be having more of these real conversations around AI based publisher products as opposed to just the theoretical stuff, which was fun in the past, but it felt like it was getting a little tired. A bit more Alex with BBC. So is that conversation primarily just around what the BBC trying to build up this US business?
- [39:59]
Kamika McCoy
Yeah, so I would say more so than being specifically about the push from the UK into the us I think we're going to be talking more about how the BBC has completely revamped both its website and app over the past year with an eye toward increasing its presence in the US and within the minds of the US audience. And so One example of that is that BBC recently integrated audio into BBC.com, and when I was speaking to a company representative, they used this as an example of how the BBC has, according to them, doubled its investment in product development around its newsroom. So I do think that there's been some divergence between the BBC's UK and US experiences over the past year and we see that with things like BBC Verify, which was the fact checking vertical that BBC launched a couple of years ago, particularly with regard to some of the freedom of speech issues in the United States. I think they have really started to increase the rate of US news discussed in BBCVerify. So that's one example of them increasing their focus on the United States. And also I think we'll have some interesting things to talk about in terms of how the BBC takes UK specific content and re edits and otherwise kind of tailors that to be more relevant to a global audience, not just a US audience, but just readers and viewers in general outside of the uk.
- [41:26]
Tim Peterson
Got it. Okay. So another product related conversation which is great because that's always been an important part of DPS in the past is having conversations around editorial products in addition to business products, or just business strategies, revenue sources, things of that nature. I think it'll really help to round out the conversations, especially I mean the conversations in the town halls. Because as much as I do enjoy our sessions that we do on stage, honestly my favorite part of DPS are the town halls that we do. And we're going to have two this time around. One on Monday, which will be a shorter one, and then a lengthy one on Tuesday where we're really going to be able to dig in some things. Sarah, you're going to be teasing out some of what is said during the town halls in your media briefing. That'll be coming out a couple days after this episode goes out on March 27, the March 27 edition of the Media briefing. Sarah, beyond everything we've been talking about, anything that you're really hoping to be a hot button topic during the town halls or expect to be a hot button topic?
- [42:33]
Alexander Lee
Yeah. So obviously referral traffic is a big one that I'm really curious about. AI development in terms of products and integration into companies, for sure. I'm really curious what people are up to with their podcast businesses too. That's something that I cover and it seems like there's a lot going on. Speaking of subscriptions around, figuring out what to keep behind a paywall and what to allow for free and kind of moving that content around to see what's really working to drive subscription revenue. And I think that probably has something to do with the fact that advertising revenue, I think it's doing okay. But it sounds like podcasters are really trying to diversify for a variety of reasons. And so I'm really curious what's going on with podcast businesses. And honestly, just personally, I really want to know what publishers that have robust video production houses are doing in preparation for the TikTok ban. That's something that I feel like I talk to publishers about often just for fun, because I'm like, what are you guys gonna do? And you know, our reporter platforms, reporter Crystal, has been covering that a ton. But I'm curious, you know, sort of in that anonymous town hall situation, what people really think about what's gonna happen and if they're really doing a lot to prepare for all the changes in where audiences will go as a result of the ban if it happens, or.
- [44:14]
Tim Peterson
If they just kind of shrug it off of like, well, you know, TikTok gets a lot of views, but it doesn't bring in much revenue for us. So it's not. We're okay with it, you know, maybe going away or like, of all the issues publishers are dealing with right now, that's not. Doesn't. Maybe it doesn't rank that high unless. Or maybe it's probably true. The top of the list for all we know. So yeah, that'll be a fun one to. Well, maybe fun isn't the right word that. I'm very curious to hear what folks have to say. I'm also just curious to hear what folks have to say on the video front in general, especially because, like Alex, you cover, you know, creators. And I've always looked at creators as kind of the tip of the spear when it comes to digital video. What's going on in the digital video sphere? It typically like creators are the first line and then publishers eventually like follow suit and see a lot of what, you know, creators may had seen a year prior or months prior or even multiple years prior. Anything in particular that you're curious to kind of like compare and contrast what the reporting you've been doing on creators and then what may be going on with publishers?
- [45:21]
Kamika McCoy
Yeah, I mean, obviously we will be focusing on publishers and not content creators perspective in this story, but I think one really interesting area where creators are pushing the envelope as opposed to publishers is around brand safety over the last couple of years, particularly in 2025. And I think this is to some extent associated with cultural shifts happening in America. I have observed and written that when it comes to brands integrations with content creators, content or sponsorships of content creators, traditional concerns about brand safety simply don't matter anymore. There's an understanding that content creators, audiences just don't care or even enjoy the edgier aspects of their personalities and their content. And so any sort of negative blowback that in the past would have been associated with that, I think simply just doesn't matter to advertisers. I am curious which I imagine if.
- [46:18]
Tim Peterson
The publishers I would love for you to bring that up in the town halls with the publishers because I would think particularly the news publishers are going to hate hearing that because they're still dealing with brand safety and brand suitability issues and all these restrictions where advertisers just don't want to be around these, you know, similar topics on news publisher sites. But when it comes to creators, they're okay with it. Like, why is it that brands are able to get over that hump with creators, but it's still such a block when it comes to news publishers?
- [46:49]
Kamika McCoy
And I do wonder if it's because the type of brand safety considerations are different. I mean, we are talking at a time when there are multiple global armed conflicts happening. And so obviously brands don't want to show up next to depictions of violence or descriptions of horrific tragedies. These things are unlikely to happen on a content creator's stream. The things that a creator does that are more likely to rankle a potential advertiser or talk about drug use or maybe say something vaguely offensive to one of their friends. And so I do think it's just a different type of brand safety in general. But it's meaningful to me that brand safety is one of the big conversations I've been having with regard to the intersection between creators and advertisers. And I just want to know how the news publishers actually feel about this and are reacting to it.
- [47:38]
Tim Peterson
Yeah, well, especially like if they hear that advertisers are making nuanced decisions when it comes to brand safety and suitability with creators, but still aren't. At least I haven't heard anything to the contrary, that they aren't taking very binary stances when it comes to news publishers and their coverage. And especially like hearing what you said about recognizing that creators audiences may make some separation or allowance for advertisers related to this, accepting a distance between the creator's content and the advertiser's content. News publishers don't seem to get that benefit. So again, I'm really looking forward to you bringing this up in the room. And just like there'll be a few faces in particular that I'll probably be keeping an eye on as you're saying these things just to get their reaction.
- [48:31]
Kamika McCoy
I wonder if any of those faces are listening to this podcast right now.
- [48:34]
Tim Peterson
They might. They just might. Yeah. So I mean, obviously there's a lot that we're going to be talking about, you know, during dps, a lot of coverage that we're going to have coming out of DPS both while we're there in the, you know, ensuing weeks, especially Sarah, your media briefing. So appreciate you both coming on the show to kind of provide our listeners a little peek at what goes on at DPS so they can stay tuned for the coverage coming out of the show as well as, you know, maybe reason enough for them to join us in, I believe, Key Biscayne in September. So, Hux, Sarah, thanks for joining the show.
- [49:10]
Kamika McCoy
Thanks for having me.
- [49:11]
Alexander Lee
Thank you. See you in Vail.
- [49:19]
Tim Peterson
Thanks for listening to this episode of the Digiday podcast. If you enjoyed it, please leave us a rating and a review on Apple Podcasts, Spotify or wherever you're listening. Get more from Digiday with our daily newsletter sent out each weekday morning. Visit digiday.comnewsletters to sign up.
- [49:37]
Kamika McCoy
It.