Fragmentation of Media is Only Getting Started

Capitalists will often say that “the free market regulates itself.” Because consumers can choose with their feet and wallets, the theory says, the best companies and operators will win. It’s not a perfect science, but by and large, if your customers are pissed off at you, you’re not going to have much of a business remaining.

And this is playing out in media faster than it has since the internet was first invented.

I’m reading the memoir of Ben Bradlee, executive editor of the Washington Post from 1968 to 1991, who was made famous in the 1976 movie, All The President’s Men. Back then, how were you going to get information? The newspaper, obviously. There were heavily regulated radio and cable TV channels. The bulk of information came from a very controlled environment because of costs.

Consider the CapEx and OpEx required to publish a newspaper every day. Paper, printing presses, all of those editors, the physical real estate, trucks to deliver the papers and the list goes on. Benedict Evans, a venture capitalist and analyst, wrote about the business a few years ago. This part is key.

Newspapers are, yes, a content business, but they were also a light manufacturing business, and it was the replacement of light manufacturing and trucking with bits that removed the barrier to entry and unbundled their attention.

Newspapers were geographic monopolies because of this immense cost. Once the internet came along, cracks in the monopolies started to show. Big things take a long time to really break. Many thought that the blogging era of the early 2000s would result in the death of these big monopolies. Few of those blogs exist today and if they do, they’re tiny. So much for the new guard destroying the old guard.

And so, for decades after the internet really took hold, mainstream media remained mainstream. They retained a large hold on the audience. Presidential candidates were forced to sit down with the those media brands because they still had incredible reach—even if they didn’t have viable business models.

But 2024 was different. Kamala Harris was criticized for rarely talking to the press. She went on a ton of podcasts instead (perhaps not the right ones, but who knows?). Donald Trump ran a similar strategy, going on his own podcast tour. None of these creators were mainstream. But they had an audience’s attention.

This was a massive inflection point because anything a major media company can do, an independent or small team can do nearly as well. It’s the Pareto principle in action where independent upstarts can get 80% as good as the big content organizations with only 20% of the resources.

As I look forward to 2025, things are only going to get more fragmented. It’s not just political media. Every single category is going to get disrupted at some point. Upstarts with far better cost structures are going to be able to compete in ways they haven’t in the past. Importantly, “legacy” media needs to be prepared and get comfortable with some uncomfortable decisions.

First up is all of these newsletter writers. At first glance, they look like the bloggers I mentioned above. The difference is that they own their distribution in ways none of the bloggers ever did. Many of them are going to fail because they suck, but some are going to go on to become very big.

It’s why I think John Yedinak’s prediction here is true, even if he was a little early with the call.

Just look at The Free Press. Bari Weiss started her newsletter solo, but it has since evolved into a truly impressive operation. It now has a publisher—Dennis K. Berman, who spoke at the first AMO Summit—and is producing written stories, podcasts, events, monetizing with subscriptions and hoping to find advertising revenue. It’s becoming a diversified media company. With over $10 million in revenue and $100 million in valuation, this is a massive success story.

And many more are going to follow. In the realm of right-leaning media, you’ve also got The Dispatch, which is smaller, but still appears to have gained a strong niche following. Who does this wind up hurting? Fox News will certainly suffer. So will other right-leaning legacy media brands that used to hold marketshare.

It’s also why the LA Times and Washington Post’s owners trying to muscle into the op-ed section to curry favor with conservatives is a fool’s errand. Conservatives aren’t going to flock to the LA Times or Washington Post to read coverage of both sides.

And lest we think this is not just conservatives being sensitive, liberals are also guilty of this. The Washington Post lost 200,000 subscribers because “the resistance” was mad that Bezos pulled back on an endorsement. Brands like The Atlantic and The Guardian were more than happy to capitalize on this. So did The Bulwark, a more recent upstart.

It’s the same case in audio and video. Excluding politics for now, let’s think about food. Skift’s Rafat Ali tweeted:

He went on to say that he and his wife love watching Village Food Secrets, a YouTube channel with nearly 4.3 million subscribers. Why pay for any broad-based streaming subscription to watch food-related content when they can watch exactly what they want? I’d wager—correct me if I’m wrong, Rafat—that if Village Food Secrets decided to charge a subscription, the Ali family might consider paying because the content is exactly what they want.

My partner is a food photographer, and there’s always something food-related on in the background. Claire Saffitz spent seven years working with Bon Appétit before leaving in 2020 to do her own thing. She’s putting out regular content—primarily about baking—that she produces on her own.

And you can look at any other niche and find examples of this. The Wall Street Journal covers all business news and yet The Information has built an eight-figure business covering a few of its categories, including startups, venture capital, finance, media, etc. Newcomer is trying to compete on venture capital alone right now. Consumers don’t need large media companies to produce a wide variety of content when small teams can do just as well going so much deeper.

Go to any publisher and look at the top navigation. See how many categories there are? Upstarts beginning as newsletters or video podcasts are going to go after each category trying to win. They’re going to demand audience and advertiser attention. Because their cost structures don’t carry all the legacy bloat like mainstream media, they can build incredibly healthy businesses.

The fragmentation of media is getting quicker. Many legacy players are not prepared. I expect to see more well-known brands die over the coming years.