Should Medium Raise It’s Subscription to $10/Month?

An analysis using data from people like you and me.

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The Intro

Hello. Nice to meet you. I’m Zach, a medium writer since February of 2020. I was more of a reader then but have recently become more of a writer. I still begin every morning with a wonderful black cup of coffee and a specially curated Medium story. I’ve been having a lot of fun writing, but it takes some time to create a story. (Especially this one.)

I recently checked my bank account and the monthly five-dollar Medium membership was deducted. Among the five dollars were several other larger transactions; Spotify for fifteen, groceries at Walmart for one hundred, twelve dollars at Wendy’s, and so on.

I will easily spend money on Wendy’s because of the value of a Baconator meal. Trade twelve dollars, and in return you are given the drink of your choice, a generous serving of fries, and one of the most beautiful sandwiches on the planet.

I talk about the value of Wendy’s because Medium has value as well. But what is the true value? We all see the five dollars deducted each month from our accounts. After looking at all the other expenditures I thought why not create a survey?

The Question

Does Medium offer enough value for the five dollars we pay, or should we be charged more for membership?

Think about it. At its core, Medium is simply a website where we can read and write stories. It’s an open space for ideas that connects a network of writers.

After being a writer for several months, I’ve learned the platform is so much more than just a place to publish our thoughts and research. Medium is a place where people become writers, tell their stories, and meet other writers. It’s a place where anyone has a voice. How much are we willing to pay to listen?

The Method

In order to answer that question, I created a survey and paid people twenty-five cents per response. Using a wonderful blend of Amazon Mechanical Turk and Google Forms it’s simple to conduct market research while supporting freelance workers.

The form was simple and asked about 10 questions relating to the respondent’s online article viewing habits. The first question asked how often the respondent read online articles from 1 to 5. One being never, 5 being several times a week.

The next question asked if the worker was aware of the website, Medium. Based on their answer to this question, they were sent into one of two sets of questions. If they responded “Yes” to being aware of medium, they were sent to a series of questions that asked about their engagement with Medium such as if they are a writer and a paying subscriber.

The second set of questions were provided to those unfamiliar with Medium. They were asked questions such as “What online publications do you read?” They were also given a description of Medium and asked the maximum amount they would pay for the service per month.

All answers were sent to a spreadsheet for further analysis. While Google Forms automatically visualizes some data, I wanted to have the raw data and be able to do my own visualizations.

The Data

My research provided positive results of Medium. However, before I dive into those stats, I wanted to share some quick info about the site itself.

Medium was founded in 2012 and is estimated to have 50–200 employees. Data from Similar Web estimates the site to have 189 million unique monthly visitors. The average visit time is less than 2 minutes with about 76% of people leaving after only looking at one page (bounce rate).

Visitors from the United States make up about 31% of Medium’s traffic while India, the UK, Brazil, and Canada plus the United States all make up half of Medium’s traffic.

63% of people find Medium via a search engine while 23% land there directly from typing medium.com in their browser. 8% of visitors find Medium through social media channels, 32% of that being from Twitter which was cofounded by the founder of Medium, Ev Williams.

I also discovered a Medium story written by Casey Botticello that provides more information on Medium’s stats. The data is from October 2019 so while it’s not totally fresh, it’s still edible.

Medium is estimated to have 85 to 100 million monthly users. It has a domain authority of 95 which essentially means that when someone types “medium” into a search engine, its extremely likely that Medium.com will be the first result. Nice!

There were also an estimated 200,000 to 400,000 subscribers at that time. I mention the number of subscribers because this number will be extremely important later.

Looking at my survey results, I paid for 50 results and received 51. In the past I have always seemed to find myself with a few extra results when conducting research this way. For this reason, I’m not going to throw away any of the results as they all could be valid.

The second question asked how often people read online stories or articles, from 1 to 5. In this case 1 was equivalent to almost never while 5 was every day. The average number I received in my responses was 4.1. This leads me to believe that the majority of the population reads at least one or two articles online each week.

When asked if they were aware of Medium, 90% of people said yes. I also asked if they had an account in which 78% of respondents said “Yes.” Of the people who had an account with Medium, 96% of people were also paying for a subscription.

I also thought it would be interesting to see who was writing on the platform. 73% of respondents said they contribute at least 1 story a week on the platform. When asked how many stories they write, respondents answered with an average of 2.8 stories a week. I found that while most people write less than 5 stories a week however some are very active contributors and write over 5 stories a week.

For those who were unaware of Medium, they tend to read on sites such as CNN, BBC, Wall Street Journal, and the New York Times. They seem to pay about $7 or so each month for access to those publications. When I described Medium to them, only 60% said they would pay the current rate of $5/month. The other 40% said they would pay less than $5.

Now on to our question. Does Medium offer enough value for the five dollars we pay, or are we underpaying for it? Well maybe. 65% of the 46 subscribers would still pay for Medium if its cost rose to $10 a month. But that leads to another question. Why pay more for Medium?

The business model of Medium was not designed to be profitable for the company but support the writers on its platform. This is way I ask the question. If we all were to pay twice as much for access to this platform, 65% of us would stick around. There would be more money in the pool for writers, as well as the staff and administrative costs for Medium.

I took some time and played with these numbers. Note that no figures are known, and all percentages and dollar figures are estimates. Let’s assume administrative costs (salaries, debts, offices, etc.) are 20% of the revenue or $1.00 of each subscription. Site and server upkeep might be 15% of revenue, while 1% of our $5.00 goes to advertising such as CPC. I personally haven’t seen much advertising by Medium but remember, this is all assuming stats and figures based on my research.

This current distribution would leave 64% of each subscription for the writer’s pool. At 200,000 subscribers this would be $640,000 left for writers or $7.6 million/year. Remember, this is the lowest end of the subscriber count and the stats are from almost a year ago.

If we were to assume that Medium had 400,000 paying subscribers, the money left for writers would rise to $1.2 million/month. Assuming every writer is paid evenly, a writer would earn $3.20 a month.

As we all know, that’s not the case. Some writers have their stories curated and become top writers, while others only write one story a week and only earn a few cents.

The $10 Answer

If Medium were to raise the cost of the subscription, it would lose 35% of its current subscriber base, impacting the number of stories published as well. It would also slightly raise the barrier of entry to become a writer and cause other unforeseen circumstances.

Assuming Medium has 400,000 subscribers and only 65% stick around, that would leave about 257,000 subscribers. This number would bring in about $2.5 million in revenue for Medium. Using our same distributions, the writer’s pool would still be 64% and that would equal $1.6 million/month or $19.7 million/year. If each writer was paid equally, they would receive $6.40 each month.

The Conversation

With all this information, it’s difficult to accurately predict the amount that a writer would make. Consider that Medium is privately held and doesn’t have to report earnings like a public corporation. Consider that if the price did raise to $10 Medium could fail or Medium could flourish and use their share of the revenue to grow the platform while paying writers more.

I want to be clear; I don’t have an opinion on whether or not Medium writers should be paid more. The platform was designed in a way that effort is rewarded. You seem to be paid based on the amount of time a subscriber reads your story and how many claps it receives. But again, Medium is private and has not released its payout algorithm.

I don’t expect Medium to cover all my life expenses but do expect it to be a platform and publisher where I can share my ideas and build my community. What are your thoughts on increasing the cost to $10/month?

-ZG

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