Every publisher is unique, from their monetization methods to the technology stack they use to how they handle today’s challenges and apply strategies to take advantage of future opportunities. That diversity in thought and action creates a learning for every other publisher.
Throughout 2023, we’ve had many conversations with publishers at events, roundtables and one-on-one, and repeatedly, the same pressing concerns and emerging trends dominate the discussions.
Below are four pivotal themes that publishers are focused on, with insights into how they could impact the industry and what steps publishers are taking to prepare for the future.
Revenue Diversification Is Critical
The need for multiple stable revenue streams has become increasingly evident. Publishers are working to reduce their dependency on advertising revenue alone. Some common strategies include implementing paywalls and subscription options, establishing licensing deals and asking readers for donations. These stable revenue sources are enabling publishers to experiment with ‘leaps of faith,’ such as testing new formats like CTV, investing in e-commerce and exploring AI possibilities.
However, while there was recognition that diversification is important, staying focused is equally so. Publishers with multiple sites are stepping away from a “one size fits all” approach and developing more focused strategies. For example, a lifestyle site might do exceptionally well with e-commerce, while a niche content site might find the most success through subscriptions. Similarly, each page within a site should serve one goal rather than trying to incorporate all of them at once.
Dependency on Search Engines Needs to Change
For years, publishers have relied on traffic from search engines and social media channels, but that dependency also puts publishers at the mercy of these platforms. Too often, an algorithmic change comes along, knocking the wind out of publishers’ sails and throttling traffic. Further complicating the matter is that search engines will begin to weave generative AI into the search experience. Consumers will be presented with a paragraph scraped from a publisher’s story, eliminating the need for the reader to click on an article. Many publishers are concerned about this change, viewing it as a threat to their business as it will essentially crush their search traffic. Additionally, search engines are often inconsistent in the cut they take from publishers, and that is not a foundation on which publishers can rely.
There was also a lot of chatter about the future of search engines and their value as more consumers turn to AI chatbots like ChatGPT or Bard to find information, be it a recipe, travel plans or website design advice. Another hot topic was Google’s recently expanded Search Generative Experience to Japan and India, the first countries outside the U.S. to have access to Google’s GenAI experiments. While it’s not yet the default search experience, it raises existential questions: Could AI render search engines obsolete? Will it redefine the rules of engagement? Time will tell, but forward-thinking publishers are being cautious about building reliance on traffic coming from search engines.
Threats of AI to Publisher Business Models
As you can guess, no topic was more talked about than AI. Generative AI tools mean that with relatively low effort and minimal costs, anyone can begin producing, enhancing and optimizing content, creating a very real threat to publishers’ business models.
To make things worse, generative AI companies trained their models by scraping publisher sites and using their content without permission, attribution or compensation. Publishers are now forced to grapple with what to do next. Opinions varied, ranging from just letting it happen to lawyering up to relying on blockchain watermarks to prevent content from being used without attribution.
Publishers were also concerned about the ethics of allowing AI-generated stories to spread online. On the surface, AI-generated content appears truthful and accurate, but it’s prone to sharing misinformation. Sometimes, generative AI gives correct details but is unable to cite sources. Other times, it ‘hallucinates’ and makes up ‘facts’, which can cause misinformation to spread, eroding consumer trust.
Its unreliability underscores the essential role that publishers, investigative journalists and fact-checkers have as guardians of truth. Publishers generally agreed that the proliferation of AI-generated content means their unique selling proposition must put brand at its heart, capitalizing on the trust embedded within that brand.
Embracing the Opportunities of AI
AI is a double-edged sword, so amidst the challenges lie ample possibilities. Most publishers spoke about taking a cautious but steady approach to AI. Take the hiring process, for example. Just as a few years ago, publishers hired younger professionals who could help them master social media, many said they are now looking for new hires who can help them harness the power of AI.
AI is also seen as a valuable productivity tool that can reduce some of the mundane tasks that bog down journalists. Some publishers suggested that AI could be used to quickly and effectively create more formulaic content – for example, for sports pages, reducing a journalist’s job to fact-checking and light editing. By taking care of the groundwork, AI could free up journalists’ time, allowing them to think more creatively and go deeper into stories that benefit from their expertise.
Finally, publishers are excited about AI’s potential to bring personalized content delivery to the open web. Surfacing relevant homepage content, curating user journeys based on individual preferences, and optimizing lifetime value are now within reach. Many wonder if this could be the holy grail for publishers.
Looking Towards the Future
Our conversations highlighted that the digital publishing industry is at the crossroads of transformation, and many are willing to welcome the next phase. To succeed, publishers will need to think differently. Revenue diversification will be more important than ever – years of algorithmic uncertainty have made that clear. When used thoughtfully, AI can be maximized and turned from foe to friend.
The publishing industry is, in many ways, in uncharted waters, but it’s not the first time. If we continue to safeguard integrity and join forces to create a valuable digital landscape, there’s room for every publisher to flourish.