[upbeat music] I think about this moment, you know, of course there's gonna be all these headlines, you know, say this is unprecedented, you know, what we're facing post, post-COVID, and- No, it's not like the financial crisis.
They shrank my cubicle at Adweek. I think it's gonna be a challenging ad market. Like, I think people are gonna lose their jobs. It is hard.
[upbeat music] Welcome to the Rebooting show, where each week I speak to a media executive who is building a sustainable business.
I'm Brian Morrissey. This week, I'm joined by Sebastian Tomich, the chief commercial officer at The Athletic.
Earlier this fall, The Athletic introduced advertising for the first time in its seven-year existence, despite running ads at some times over the last seven years, touting the fact that it did not have ads.
I talked with Seb about the advantages of starting from scratch, why The Athletic doesn't want to rely on programmatic advertising, and taking on a different approach to matching advertisers with sports fans that's more akin to stadium sponsorship deals.
I hope you enjoy this episode, and if you do, please leave a rating and review on Apple. Also, check out another podcast I'm doing. It's called People vs.
Algorithms, and each week I'm joined by former Hearst Magazines executive Troy Young and former Airbnb head of design Alex Schleifer, and we unpack patterns in media, technology, and culture.
You can find it on Apple, on Spotify, or wherever you get your podcasts. [upbeat music] Okay. Seb, welcome to the podcast. I think we, we did two, I think, before. God, two or three. Two or three.
They were both amazing experiences. So... [laughs] You're already trolling me. This is gonna go really, really well. All right.
So, like, you moved over from The New York Times to The Athletic, and The Athletic started seven years ago, famously said, "It's not gonna run ads."
And I always say that's the first step before you run ads, saying you're not gonna run ads. Like- I guess history would prove that right.
[laughs] I was like, the only people who get upset about it, this is an aside, we're even starting with an aside, is, is journalists, 'cause they're, they're the only people who care about it.
Everyone else is just like, "Yeah, things change, and so we're just gonna change the business."
But I, what I find really interesting about it, and, and we had discussed this a little bit, I remember, over a coffee, is starting from scratch, right? Because you don't get a chance to start from scratch, like, often.
Usually you're dealing with, you know, you're dealing with a, a legacy stack, you know, a legacy business, et cetera. So talk to me through... Talk, talk me through the process of starting from scratch. Yeah.
Well, first, starting from scratch is super fun. Uh, you're right.
And we are not, uh, we're not in the position of having to renew many millions of dollars of advertisers year over year that might need new fancy things or want things that we don't wanna do anymore.
So I would say, like, the, the thing that I'm focused on most is how do we make things that work for readers, and how do we make things that work for advertisers?
And those are not actually as easy to solve for as you would think. So, like- All right, so talk me through that. 'Cause it's... Ev- everything in life is trade-offs. Everything in publishing is certainly trade-offs.
So, so what, what doesn't work for readers, we know this, is bad programmatic advertising. But yeah, everywhere- But it's not all programmatic, Seb, at all. Not all programmatic. Not all programmatic.
Not wh- just, like, bad ads, and they're everywhere. And there's a reason they're there, because publishers need revenue. So, you know, from the outset we've said we're gonna focus on higher quality digital ads, right?
We don't have a print product, so it's all digital. Um, and then in doing so, how do we do things that are gonna deliver what our advertisers need on the back end? And so what they need is performance.
Some advertisers, you know, the most fun ones to work with sometimes just want a big beautiful ad, and we're gonna give that to them as well.
In some cases, the brands are just looking for a deeper association with The Athletic. We're gonna give that to them as well. The things we are not going to build for are the things that people pay to get out of. And
the only evidence I have right now is that people are willing to pay to get out of pre-roll video. I think audio will get there at some point.
I do, particularly as these big platforms keep littering our podcasts with more programmatic.
I could go on a rant right now about listening to meditation podcasts at night and Spotify serving me up with Jeep Wrangler quarterly sales targets.
They paid us directly for this thing, and also they understand that, look, ads are, are something that are needed to fund the journalism they pay for.
And then on the other side, let's build a product that can deliver the necessary performance for everyone from, you know, Roman. But as of right now, just, uh- Everyone likes a, everyone likes a good targeted ad.
I, I'm sorry. No, no, no, no. I'm sorry. They're, they're not even targeted, they're personalized. You know that. So, so look, we're, we're, we wanna make a p- a product where people can pull it up and feel
good enough that hair products to LVMH and Chanel. Yeah. Okay. But, like, introducing ads, like, uh, and, and into a subscription product is different, right? It is different. It is different.
I mean, because, like, they never had ads before. So you, you had to go through a week of people complaining, right? Yeah. We, we definitely did. We definitely did. Not people, but, like, there's some.
There's always gonna be some people who are like, "I hate this. I hate the ads." I mean, that was... And in some cases they were marketed to with, you know, I wanna make sure we're fair. Like- Yeah...
there was some marketing that said, "The Athletic is ad free"- Right... "and come subscribe."
So, like, that is, that is a fair complaint, but I think there's a difference between being angry about it and canceling your subscription. So very few people ended up canceling, right, over the ads?
I mean, I assume that's the case. This is true.
If you go through the comments thread on the first day when we announced ads, there was some angry subscribers and, look, we tried to be as transparent as possible and-I will say, like, I remember pulling up
the first couple comments and, you know, the, the, the first- [laughs]... person who commented, I remember, was very rational. They said, like, "Look, I don't love it, but I get it.
Like, you gotta pay for this journalism." And then came all the [laughs] irrational comments. [laughs] They were saying, "I'm gonna cancel my subscription tomorrow." Lo and behold, that did not happen. But I, I think...
Uh, look, our hope is,
our hope is people understand that this is necessary to fund the journalism that they're, they're paying for, and we wanna keep investing in it, and the only way we can do that is to have advertising. Yeah.
And had you thought about having a, like, a freemium model where the advertising allowed either free access or, you know, the... Being, being a subscriber meant you got an ad-free experience?
We've always talked about that. We've always talked about that at The Times too. I'm just... Again, I'm like, I'm not convinced that's the right model.
I've never, particularly with the written word, like, there's just no proof to me that people are willing to pay to get out of ads. I think you pay to get content you can't get anywhere else. Yeah.
And you might prefer it if it doesn't have ads, sure. Yeah. Like, if I have a choice between ads and no ads, I'll always choose no ads. But, like, am I really gonna...
If, if I have a free option and a paid option, and the only difference between the two is no ads, I don't think that makes me wanna pay. Yeah. Yeah, I think it...
Like you said, like, I mean, people obviously pay to get out of, like, ads in streaming and, and, and also, like, audio. In v- in video. But also audio. But is that proven? Is that proven in audio yet? Is that proven?
Like, I... Has a, has the- Uh- Has that industry matured? Well, like with Spotify. I mean, Spotify just sort of bangs you over.
Which I always sound funny, it's like Spotify, to me, they, like, use advertisers to annoy people to the degree that they'll subscribe. Fair. Like, 'cause they'll- Music, music is your correction here. Music- Okay.
When you say audio, it's very... That's true. So in podcasts right now, you know, you still pay, as a paying subscriber to Spotify, you still get ads. And so they're, they're getting their cake and eating it too.
But for music, yes, you are very willing to pay. But I think, again, that, that makes complete sense. Like, I- Yeah. It is, it is very disruptive to get advertising between songs you're listening to. Okay.
So y- you were y- no programmatic you decided. Uh- Or just no open programmatic? So I said, very smartly said, "Never say never." Okay. So I said, "Never say never."
But my goal, look, again, great ad quality is the goal. If a way to do that is to keep programmatic out, then that's what we're gonna do.
Open pro- open market, we, you know, we're gonna keep testing to see if we can manage to have some programmatic and keep ad quality high, but it's really hard to do. No one has showed me a path yet.
How do you- I'm sure there's a million programmatic vendors who are gonna email me right after this and say they've managed [laughs] to solve this problem, so I regret saying that. Hi, sent.
[laughs] Get ready for those Calendly links to come fast and furious. [laughs] And if you do, uh, end up using any of them, can you tell them to contact me and, and, and do an ad deal? Of course.
'Cause I believe in advertising. Because a l- a lot of, you know, advertising does do... You know, it should be part of most media products in my, in my view.
And it doesn't have to be, it doesn't have to be bad for the user experience necessarily. But it's a balance, of course. You're kind of a trendsetter on that.
I think, uh, it's not the norm on Substack to, uh, to have ads, and you kinda do your own thing, and- Exactly. Yeah. I always read your ads. [upbeat music] There you go.
I don't think we have an ad for this one. But leaving that aside, but when you were deciding what to... How the ad product should look, like, how do you... And, and perform,
how do you end up judging whether the advertising experience is negative to the user experience? 'Cause I'm always, like, left, like, going to, like, various sites, and, like, the experience is horrific, right?
And I'm like, "But maybe that's qualitative." [laughs] You know? Maybe it's not actually- Mm-hmm... horrific. But how do you end up systematically judging whether or not, you know, you're going too far?
Yeah, I mean, look, there's endless tests you can do. You can do AB testing, you can look at subscriber, sub- subscriber metrics, engagement. We've done all of that. You know, we get, we've...
The Athletic gets to benefit from the fact that The Times has been looking at this data for years and years and years, right? Yeah.
So back to me starting at The Times in 2013, every single year was another year of reanalyzing where ads should go on a page, and how many ads, what types of ads. I would say my learning from
doing that for 10 years is that you're never gonna see the data on the other side to validate what you're thinking. Yeah. And a lot of the times it's just gonna be a gut call. And
I, I tend to think that if there was gonna be a negative impact, you're not gonna see it in the data in the first months of a test.
It's gonna happen over the course of the long term, and you, you slowly degrade your product. You know, subscribers will eventually leave. They might just not leave immediately as part of some test.
So I think, like, you gotta just look at something and make a call and say, "This feels right." Yeah. And then of course you could probably push it too far, and you get test results that are gonna validate that.
But I think when we're dealing with something that is more about creating, like, a really positive user experience, like, I just think you have to look at it and say, "This is good."
And so I feel good about what we've created. I mean, you tell me. You use The Times product pretty regularly. I find the ad experience to be kind of right. Almost, I, I would say perfect.
Like, but I'm probably chewing my own horn on that. Let's not go perfect. I mean, come on. Yeah, that's perfect, perfect, perfect. [laughs] I was like, I'm, like, nodding. I'm like, "Yeah, okay.
I'm, I'm gonna go along with this one." And then you go, "All right, perfect." No, no, not perfect. Maybe not perfect. But get- Right on the line between, like, ad- No, it's not bad. It's not bad. It's not bad.
Look, the, the ads are... And, and what I liked about the ads, 'cause I think sometimes it's confused, is bigger doesn't mean worse from a user experience.
And I have no data to prove this, but, like, I would rather have fewer and bigger ads. Like, I remember, you know, designing pages, like, I would always want fewer but bigger. Like, let's,
you know, let's not hide the ads, like-Off to the side where they're not seen, and they're still, they're still slowing the page down.
Like, as long as it doesn't slow the page down too much, and it's not too interruptive to the user experience.
Like, it's no problem to have a break, I feel like, as you're going through, but, like, when it's obscuring the content [laughs] like, sometimes you're trying to, like, hunt for the content, not on The Athletic or, or The Times.
Yep. You definitely get some... There's some, uh, publishers that will not be named, but in the, like, probably more in, like, the lower-end news sector- Yeah...
where you could see some really special types of pages where you get more ads. Yeah, the UK has, like, a whole rogues' gallery. I don't know what's going on- [laughs]...
with the UK programmatic ad market in particular, but, like, holy crap, you go to some of those sites, and it's a bracing experience, for sure. So that's how we differentiate. [laughs] Have you seen these guys?
But you decided to go with, like, display ads. Like, explain that. Yeah. Like, 'cause, I mean, a lot of...
You know, there's always this, like, native and, you know, nowadays with newsletters, you know, there's the sort of handcrafted ads. I mean, I'm, I'm handcrafted my ads.
I think you were, you were always hassling me about those, too, uh, when I was at the, the Times job. Well, yeah, the newsletter ads for The New York Times suck. Like, the... Like, and it... It's, like, established now.
It's gotten better. They've gotten better. They've gotten, they've gotten better, but they sucked for a long time because, like, it's like,
okay, Morning Brew had layoffs today, but, like, Morning Brew sort of, like, solved a good, like, newsletter ad format. It's fine.
Like, why don't we just all, like, take, like, the, the Morning Brew newsletter ad format and use it? It, it seems like it works. Well, and, and let's give credit to Axios, too. Um- Yeah, okay, Axios, too...
so for, like, both, both of them are kinda trendsetters in that space. Yeah, I mean, I've always would... To, to take a page out of those, both of their books, I think,
you know, we will be expanding into newsletters, uh, as well, and I think as long as the product is scalable, we're interested in it.
I think the tricky thing with, like, branded content and the history of T Brand, it's, like, there's only so many of those types of programs you can do. Yeah. But newsletter ads, it's more about,
I think, designing something that fits the product. Um, I think in the case of those two publishers, like, at least from the outside, from my viewpoint, those are their primary products.
They are, like, newsletter companies. Yeah. So it makes a lot of sense, and The Athletic is not a newsletter company, nor is The New York Times. Yeah.
Like, so they do a lot more, and so I think it's a little bit more challenging to build just a newsletter business. And so you might have to rely on some of those ads that you've pointed out that you don't like.
I think for us, like, display's gonna be one of the many things we sell. I... If we can figure out something that scales, that is more custom in fitting the product, we'll totally do it. Yeah. Totally do it.
We're just, you know, just starting. So how are you doing the, the, the targeting? I remember you... We, we were talking before.
You had mentioned, like, thinking about it like stadium sponsorship deals versus how regular ad targeting goes. Yep.
So we're looking at it teams, leagues, and sports, so being able to cordon off certain areas of our coverage and attach a brand to it.
You know, we will certainly have, like, a foundation of a ad business where people are gonna come to us and target, target audiences, use data.
But a lot of the sports industry is built around these team, league, and sports sponsorships.
So, you know, we can work with a sponsor of a team and say, "Hey, would you like to extend that under the coverage of that team?" I think in the case of... You're, you're an Eagles fan? I... Very much so.
All right, very much so. And you're a subscriber to The Athletic, too, right? Of course I am. Long time. Perfect.
So, uh- I, even during the Eagles' last Super Bowl run, 'cause they're having another one right now, I even remember giving, like, a gift of The Athletic to a, a colleague because I wanted him to read about the Eagles' Super Bowl run.
So I gotta... I actually have to pull up who is, who's it... So, so Lincoln Financial- You're checking if I'm a subscriber [laughs]. So... No, I'm not checking you're- Oh, I am... I was like...
So, so Lincoln Financial, and so we might, you know, we might go work with them and say, "Hey, like, you know, extend your Eagles relationship onto our Eagles coverage, and we have the best community of Eagles fans."
Like, these are different ways we can work with sponsors. Um, we've got a fun deal coming up, which I think we're gonna- Yeah... talk about. Um- The Google deal? The Google deal- Yeah...
which we're really, really, really excited about, which is all around, uh, them helping us invest more in women's sports coverage. And so should we, should we get into that? Yeah, yeah. Let's do it.
Um- I, I wanna get into this because I think it's really interesting.
I mean, go into it, but I think, like, in just reading over the little blurb about it, I think it's interesting for advertisers to enable, like, extra that they, that wouldn't exist without them, and making it, like, clear that, like, you know, they're underwriting something that...
I mean, it can go both ways, but I think it's interesting. I think, like... So, so Google is a great example of a brand that is... They are very publicly investing in women's sports.
So they have a big partnership with ESPN and the WNBA, where through their deal they're helping to guarantee coverage of more games by guaranteeing advertising.
And very similar with us, we've been able to work out a partnership where through their investment we've been able to guarantee nearly doubling our coverage every year in women's sports with a focus on soccer and NWSL, women's national team, and WNBA.
And that comes through hiring more journalists, and so we, we just publicly hired another WNBA writer, and it's, it's pretty shocking, like, when you get into women's sports media just how little coverage there is, like, the amount of journalists out there.
I don't have the exact stat on WNBA- Yeah... but it's, like, single digits full-time, and NWSL single digit full-time.
[gentle music]Is, is that because there's not enough, like, I, I don't mean this in a bad way, like, interest in it?
Like, is this, like, a market failure that, like, an a- a- advertiser support can, like, correct?
'Cause, like, if you're just looking at the data of who converts on what content, like, you know, when you have just a subscription business, if readers were, like, converting on WNBA content, or they weren't churning because they were heavy consumers of WN- WNBA content, there wouldn't necessarily need to be, like, an underwriting, uh, relationship for that content to be produced, right?
I think there's kind of a... There's just this kind of vicious cycle where there's not enough advertising- Yeah...
so there's not enough coverage, so then in turn there's not enough, uh, interest in the media, but there's certainly interest in the games. Yeah. That's why- Um-... I, I'm surprised because, like, you know, it's like...
It's a weird cycle that has to be- Yeah... corrected, so I really give credit to brands like Google who are looking to circumvent that process and just say, "Look, we will guarantee the funding.
You will create more coverage. In turn, more fans will read the coverage," which then in turn builds more fans and more coverage, and it becomes a virtuous cycle. So I, I think this will change.
I mean, at least the breakthrough for me has just been going to more games. I went to the NWSL championship a couple weeks ago. You see the energy, you see the fans, and I think
one way for me to think about it at least was stop directly comparing it to the men's sports equivalent- Mm-hmm... and just think about how many fans are out there. Like, how many women are interested in sports?
How many young up-and-coming women athletes are there in the country- Yeah... that are gonna want to follow these pro athletes and go to games, and big businesses will be built around that. Yeah.
And then look at the pro sports leagues that are serving those fans. You can see an inefficiency. Like, there is a big opportunity there versus just constantly getting stuck on, like, oh, you know, like,
like, do they score as many goals? Are the players just as fast? Things like that. Like, just think of it through its own individual lens. Yeah. E- explain how this deal is more than, like, just, like, an ad deal. Yeah.
So Google is... So the partnership includes us hiring more journalists to cover more- Mm... of these games, so we will nearly double our, our coverage year over year.
And then in addition, we'll be using Google technology to enhance the coverage, and so these are things like things that we're already planning for by, like, using Pixel phones to do more visual journalism, outfitting our journalists with those.
Things that we haven't worked out yet, but you can imagine, like, Google has a long list of different technologies we can use, and if you can look back to some past time- Times programs for inspiration, like we've used Google Lens to turn the Sunday magazine into augmented reality features.
We've used Google Maps to enhance 36 Hours, done work with Google Home. We've done work with Search. So, like, you can apply those things.
Now that we have access to those tools and Google working with us, apply that to our journalism, you can imagine how it's gonna get better. Mm-hmm.
And in many cases, that stuff is the most costly stuff to produce, and now with this partnership, we're able to guarantee that we can do it. Yeah.
So how much can this be like a template for, for other de- deals like this? I mean, or, or is this, like, the sort of...
I mean, to get back to my ske- skeptical side, like, you know, these are usually deals that, like, you know, companies like to talk about, but, like, the blocking and tackling is, you know, a lot of the, you know,
regular display campaigns. No, this is, this is the real deal. So [laughs] this is the real deal. This is not like a PR window dressing- [laughs]... plus then there's, you know, doing holiday sales for phones. No.
This is, this is- But, like, what, like, w- can you use this template for... And, a- and how would you end, end up using this template then? Oh, yeah, absolutely.
So in the case of, I'll use women's sports just 'cause we're talking about it, like, I could see a world in which we have two or three other partners as well, not doing the same type of program as Google, but, you know, we could expand into new sports that we're not covering today, like women's hockey, and we bring a partner on board to do that.
In the case of outside of women's sports, expansions into F1. Believe it or not, I've had a request for an expansion into pickleball. I was gonna bring up pickleball to be honest with you. [laughs] That's so strange.
So look, like, there are, there are many- Pickleball's exploding. I saw that in Florida. There- The, Florida's the future, and, like, they were converting over...
During the pandemic, they were converting tons of, like, beach volleyball courts into pickleball courts. Pickleball is exploding. Sport... Look, sports is exploding. The sports industry is exploding.
I mean, you look at every single valuation of every team, this industry is, like, exponentially growing. And so I just think of, like, The Athletic playbook.
If you believe in The Athletic playbook, which is hire the best journalists on a given sport, create the best content in that sport, charge for it, and now have advertising next to it.
Look at all the areas where, you know, we're, we are very well-covered right now in English Premier League, NFL, MLB, NHL. Mm-hmm.
But then you can pick off the places we're not as saturated, and you can imagine we could have a big partnership tied to it. Yeah.
So The Athletic always had, like, a very sort of simple business model, and I think there's a ton of advantages to having just aligning with subscriptions. You saw Netflix, you know, stuck with subscriptions.
It was very clean. It was one price, one, you know, uh, one service, one product, et cetera. Now they have an ad-supported tier, and it gets more complicated, and that's just how things go.
Um, I would assume that we're going to see a lot more freely available content now that there is an advertising component, because you have to build the top of the funnel, and, like- Definitely...
every single subscription service runs into an issue of, of, you know, saturating the available market. Absolutely. Yes. The short answer is yes. Mm-hmm. There will be a lot more free content available.
I mean, very similar to the-... Times model, which is pretty dynamic, right? You get opportunities where it goes, like during COVID, all of our COVID coverage went outside of the paywall.
I don't think that was necessarily a subscription play. Yeah. Building the funnel is more about public service. Maybe it was. Big consp- Uh [laughs]...
I've been getting into a lot of New York Times conspiracy theories with this SBS stuff. I... Keep me out of it. [laughs] Keep me out of it.
Uh, so I- You go down, yeah, I'm telling you, you go down some of these tweet rabbit holes, and like you start to be like, "Oh my God, I'm connecting dots I didn't even know existed." Get off the Twitter, Brian.
[laughs] Keep telling myself this. It's good for your, good for your mental health. So except for Athletic. [laughs] Please read all, all of our tweets.
Uh, so I, I, I think, like, uh, particularly around big major sports moments, like I think in the case of, I mean, these, you know, for the, the coverage for the hardcore fan- Mm...
like when you're going really deep on things- Yeah... there are some things that, like, you would only- The All 22, the Eagles, uh, Redskins game that shows- Yeah, like... that they had 10 men on the defense twice.
Jalen Hurts' analysis of why his right ankle makes him so special is just for the hardcore fan.
But for big moments like the World Cup coming up, like it's much more about the casual fan, like these are opportunities for, to, for us to build our top of the funnel.
Absolutely big moments for advertising as well, so you'll see a lot more sampling of free content. And that'll apply for all these big moments coming up.
Yeah, speaking of complications, uh, how much more complicated does the business get as part of The Times because of the bundle? How much more complicated does it get? Yeah.
I mean, to me, that is a big- Because it's like, I'm like, I'm like unclear, like are you trying to drive subscriptions to The Athletic or are you trying to like drive like subscriptions to, like the New York Times Bundle?
I mean, the short answer is both. Uh, I mean that- But that, but that's more complicated, isn't it, than just saying- Well, I mean,
there are, I mean, the, there's, the, the focus- Like I'm an Athletic sub- I'm an Athletic subscriber, and I'm a New York Times subscriber. Yeah. I do not have the bundle yet.
Like I, like do you want me to get the bundle? Absolutely not. [laughs] Okay, so you want me to keep paying twice, right? I mean, yeah, but that sounds like that's a special case.
That sounds like that's more about you just not wanting to go through some credit card numbers and change your account. But I think, look, I think the focus of the company is definitely around the bundle.
You know, Meredith's talked about the essential subscription and just, like the importance of- Mm-hmm... The Athletic in combination with Cooking and Wirecutter, you know, expanding our potential audience exponentially.
So, like that is a huge opportunity for The Times.
At the same time, there's a cohort of sports fans that aren't necessarily interested in The New York Times or Cooking or Wirecutter or Games, and really what they want is coverage of their team and league, and like we need to be able to market to them directly, too.
Mm-hmm. And so- And if it- When I say both, I mean- Yeah... I mean both. Is sales done through, like a, a dedicated sales team or through The Times- You mean on the, on the outside? Or both? Yeah, yeah. On the outside?
Yeah. Yeah, this is always complicated. Yeah. Short answer is we want, we want the best of what The Times can s- can deliver, [laughs] and we don't wanna take any of the complicated stuff with it.
So The Times has an incredible team, a lot of resources, a giant client network, like The Athletic stands to benefit a lot from that.
At the same time, like very tactically, like we can't grow The Athletic's business being a line item as part of- Yeah... a Times media buy. And so, like, it's gotta be able to stand on its own and have its own team.
And sports is different. Like the sports advertising business does not trade like the news advertising business.
Like it's much more built on these, like longstanding relationships with, again, teams, league sports, big sports moments, title sponsorships of things like the World Cup and the Super Bowl.
So you navigate that a lot differently than, you know, fighting to be a part of fill-in-the-blank investment bank's Q4 media plan. Yeah.
And you don't have to deal with people telling you to keep them away from Trump stuff or whatnot. That part, I- [laughs] That, that has been nice. I'm trying to think. There's been, you know, there's...
Sports is not free of controversy. Sports is not free of con- And, and The Athletic, given what it is- I know, but compared to the last, I don't even know how many years now. Oh, my God. How long has it been? Yeah.
Seven years? Like, you know- Yeah... sports is a respite from the rest of the world, I feel like. I feel like that's why it's exploding, because the rest of the world- I-... is also exploding, just in a bad way.
I think, I think that's, that's a very, that's, that's, I, not surprising that you would have that view.
I think like, I think there's a, there's a positive way to look at it, but I haven't formulated like a really compelling one liner, which is- I, that is a positive way.
I think sports are a necessary- The rest of the world is, is imploding, so that's why sports is growing. That is not a positive outlook. It's, it's factual.
I- Uh, that is not a positive- I don't, this is why, you know, I'm back in New York and not in Miami, that's why.
[upbeat music] I think more that these teams in these leagues were valued like sports entities, and now they're starting to get valued like media entities.
Like, like as brands that can get a lot of people all around the world to focus on them all at once. Like, look at the, the Commanders, right?
Like, I mean, I don't know if you could do like a worse job as a steward of like [laughs] a, a franchise and a brand. And like, and they're gonna sell for like eight billion. [laughs] Scarcity.
I mean, it's just scarcity. Like if there's a lot of money out there, and like how many Washington Commanders are there? Yeah.
Like, I mean, I feel like they used to be always touted as one of the most valuable- Oh yeah, they were... yeah, but yeah. But I mean, like, it was a different brand.
It was the Redskins back then, so the brand is totally different. A lot of the fans just gave up and just threw in the towel.
I guess the feeling, I mean, uh, but again, it just shows that I think the greatest weakness of digital media was the fact that there was no easy way to create scarcity. I think exactly right.
So I like, that, so one angle in is-I think teams, leagues, and athletes too, are starting to realize their value as media companies. Okay. And not just sports entities, and I think that's huge.
There's another one, but that you saved this for your podcast with Troy. Okay. Which is much, much more heady. I love it. Let's do it. Which is like, I'm speaking- We can go back to PMPs later.
Like, I remember these kind of, like, futurist podcast episodes 10 years ago. They would talk about- Yeah... this, like, incoming era of leisure where, like, AI would take care of all of our tasks, and, like- Oh, yeah...
you know, white collar workforce would all be in this utopia. I'm starting to think that that's happening, and we're not talking about it.
And like, and all of the things that are tied to leisure are becoming infinitely more valuable. And so like, think about pickleball,
and I just think about sports writ large, like anything that's about hanging out and having a good time is becoming...
And capturing that time that you would've spent while you were, you know, out grocery shopping or doing errands is be- So what are you... Are you saying that people aren't working enough?
'Cause I do think- I just think-... we're in, we're in, like, a, a pivot back to like...
'Cause I always, I believe in this, like, overcorrections, and I think that, that the pandemic was this, like, reevaluation of work's role within life and stuff like this for a lot of people.
And, and now we're seeing, like, the overcorrection with, like, symbolized by the, like, Elon Musk, like, extremely hardcore. I just... I think just the explosion of content.
There's clearly more time and attention to be captured and, like, I, I just, I feel like the rise of sports is, like, playing a huge role in this. And so, like, I don't know.
I think that there is more, there is more free time even though people think that they're working harder than ever. And I think sports is capturing a lot of that. So that's just my...
At this ti- But I told you, it's not well formulated yet. Okay. No, I'm- So... I'm, I'm in on it. I like it. I don't feel, I don't feel this, like, you know, extreme amount of leisure time lately, but that's okay.
Speaking of that, I mean, it's better than having too much leisure time, and unfortunately we're, like, in another period where, again, an, an overcorrection, perhaps from pandemic excesses.
But, like, are you scared about the ad market, like, really dropping like [laughs] a rock in 2023? I mean, I'm certainly reading all the same press you are. I think- But you're seeing it. You're talking to...
I mean, I'm talking to advertisers, but, like, not the big brands that are driving the economy. Yeah. I mean, on the, the time side, everything's, you know, public and out there. Yeah.
So in terms of our guidance, like, yeah, certainly, you know, you're facing headwinds, but the results have been holding.
I think looking to next year, the benefit for The Athletic is, like, we just, we're not comping up against a really big business this year. So, you know, we're building from scratch. You'll be up no matter what.
That's the good thing, so. [laughs] So we're building from scratch, and I definitely expect it to be a challenging market. But at the same time, uh,
you know, I think we're new, and I think we have a really unique proposition, so that helps us a lot. So that is a- I wouldn't- So is that, like, a net benefit?
Because, like, you know, there's one school of thought that, like, you know, people are less likely to take, you know, they don't wanna take risks.
There's a lot of, like, uncertainty, and so th- they, they go with the tried and true versus new p- we're not taking on new partners, et cetera. But then, you know, you can potentially be a lot more nimble as a new...
Yeah. I would rather face a tough ad market right in the start- Yeah... than, like, five years into our journey.
And then also, I think there's a, a bit of a contrast here between people who worked through 2008 and 2009- Oh, yeah... and people who didn't. And, like, I remember that. That was such a big moment in my...
I'd just started my career. You know, I, I was thinking back in, back in '08, late '08, I remember thinking, "Wow, this is never going to end."
And then, and then in 2009, towards the end, it kinda just started rebounding, and I didn't realize it was rebounding- Yeah, but it was like-... but it was rebounding... the thing was, like, it was like I never...
You didn't even really notice that it ended. It was very strange, and then maybe the res- It just- It's sort of like the pandemic. It's like, did it end? There was no celebratory moment that we're like, "We're back."
And so I think about this moment, you know, of course there's gonna be all these headlines, you know, say this is unprecedented, you know, what we're facing- Eh... post, post-COVID and...
But- No, it's not like the financial crisis. They shrank my cubicle at Adweek. [laughs] I think it's gonna be, I think it's gonna be a challenging ad market. Like, I think people are gonna lose their jobs. It's hard.
If you worked through '08 and '09 than I did, that certainly, like, shaped my view of work for the rest of my career, like, knowing that those moments can happen.
But what I've been saying to other people is, like, the other thing I learned is it just, it happens, and then things will get better. Yeah.
And so, like- But I mean, you can't, like, reorient the ad product to be, like, all performance, right? Nice pivot to something very big, to something very specific there. Um- Well, I mean-
Which, uh, reorient the ad products, I think- I, I go high, low, specific, general... we certainly, we have a big direct response business already, by the way.
We've got 120 podcasts, and most of the advertisers that run in them are all- Yeah... direct response performance, and it works for them, so confident that will continue.
I certainly think in a tough ad market, it gets harder to close the big brand deals. Mm-hmm. Those are always, like, the first thing that gets cut.
But like I was saying before, like, sports, money going into sports seems to be skyrocketing no matter what- Yeah... is going on in the economy. So, like, that helps.
Do you have, like, a preferred, like, gambling provider? We do. BetMGM in the US. Okay. But the explosion of sports has also gone hand-in-hand with the legalization of gambling, sports gambling, so...
And I mean the money, money going into sports. We, I mean, we have a pretty modest partnership, like, in the context of these sports betting partnerships that you see out there.
Like, you know, we had to do something that worked for us and works for them. Like, we're not gonna be one of those companies that, like, rebrands our site, The Athletic/BetMGM- BetMGM... DraftKings, et cetera.
So, but we have a really good partnership with them. You know, it's, they advertise on our podcasts. We do some betting content.
I think that-Thing that, you know, beyond the negative press about betting, like in many cases, it's a valuable tool for sports fans.
Like, a lot of the people who read The Athletic s- place bets, and so, like, having odds and being able to learn more about games and having a place to place those bets is valuable to them. Yeah.
[clears throat] I think when it's not, like, the overwhelming part of the business, like, right or wrong, like, I feel like a lot of the...
And I'm like the old guy complaining about this stuff, but, like, a lot of, like, sports companies have gone too far down.
They're like betting companies that, like, also have sports to some degree, and I feel like it's forced.
Whereas, like, it's fine, like, you know, the lines and stuff like this should be part of a lot of, like, podcasts and stuff.
But it's not, it's not as overdone, I've noticed, [chuckles] than when, like, you know, the, the betting stuff is, like, half the revenue. I feel like that's generally, like, a New York Times just playbook in general.
Like, most of our stuff is not too overwhelming. I'm trying to think. I don't think there's an example of any, you know, BD partnership or ad partnership that feels, like, totally in your face and overwhelming. Yeah.
Okay. You might be able to correct me, but I don't think so. I don't know. I'll go through my list. Okay, so you're not, like, super negative about, like, 2023.
It's just gonna be a rough period, and- I'm an optimist in general. And again, we worked through this in '08, so let's get through it. Let's plow through.
We'll, obviously we'll face some challenges, but it's gonna be good on the other side. Okay. Let's leave it there. Seb, thank you so much. Appreciate you, uh, joining me. As always, great being here.
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