Aug 11, 2021

Axios Login

Ina returns from her Tokyo Olympics adventure with tomorrow's Login. It's been fun filling in for her these weeks, but I admit to a certain relief at her being once more on this side of the International Date Line.

Today's newsletter is 1,316 words, a 5-minute read.

1 big thing: Boom times for paywalls

Illustration: Brendan Lynch/Axios

Media that were once free or easily accessible — including news websites, podcasts, TV shows and games — rushed to get behind paywalls during the pandemic, Axios' Sara Fischer and Neal Rothschild report.

Why it matters: This accelerating trend is carving the internet into many niche audiences, Balkanizing our collective media diets.

  • Just as cable introduced a paid layer to television in the 1980s, the internet's paid layer is taking shape 40 years later.

Driving the news: New data from Piano, a company that specializes in publisher subscriptions, finds that news publisher paywalls took off in 202o and have seen sustained gains since.

  • According to Piano senior vice president Michael Silberman, the rate at which users saw a paid offer or were asked to pay for content on a news website doubled during COVID.
  • Publicly reported subscription numbers confirm that trend. For the first time last year, newspapers made more money from subscriptions than from advertising, according to Pew Research Center.

The big picture: Users are running into paywalls across a range of media, discovering they must now pay for content that was once free.

  • In addition to news sites, readers must also pay to read individual writers who are leaving established news organizations for independent writing platforms like Substack, Ghost and Twitter's Revue.

A cable subscription will no longer get you access to most of your favorite shows — you'll need to shell out for a smattering of different streaming services.

  • Since March 2020, the number of consumers who said they are willing to pay for five or more streaming services increased from 9% to 16%, according to data from Magid's latest Video Entertainment Study.

Even podcasts, traditionally the most open and freely available media via RSS feeds, are moving behind paywalls.

  • Apple and Spotify both added subscription podcast features this year, competing with Wondery, which was recently purchased by Amazon, and Luminary.

Cloud gaming, the adult entertainment platform OnlyFans, even car features like heated seats — all are relying on a subscription model.

Be smart: There's no clear consensus among experts about whether this fragmentation is a net good or bad for society.

  • "It is in some cases making some content less accessible, but I think there's still a huge amount of free content that's accessible," said Jessica Lessin, CEO and founder of The Information, a high-end subscription news service.
  • "Without subscription models, huge swaths of important public information simply wouldn't be produced."

Others argue polarization will accelerate as like-minded consumers pay to read their favorite writers.

Yes, but: All things free remain hugely popular online. Many paywalled products offer some free portions. And online advertising, which supports free services, shows no sign of stopping its growth.

2. Samsung folds new phone shapes into fall launch

Samsung is holding an online event this morning where the company is expected to introduce new foldable phones as well as a major overhaul of its watch lineup, Axios' Ina Fried reports.

The big picture: Samsung may seem to be shaking things up this year by skipping a new Galaxy Note and using its fall event to launch new foldable phones. But it's actually returning to the early days of the Note, when its mainstream smartphone would launch early in the year and more experimental devices would roll out in the fall.

Details:

  • Samsung is expected to introduce the third version of its foldable devices, the Galaxy Z Fold and the Galaxy Z Flip.
  • The company is also expected to introduce a pair of new smart watches, the first to use a new software platform co-developed with Google.

Between the lines: The Note — the grandaddy of phablets — was a niche device when it first launched back in 2011.

  • For many years, Samsung would update its Galaxy S line in the spring and debut a new Note in the fall. But over time, smartphones grew ever larger to the point where the only thing really separating the Note from other flagship smartphones was its companion pen.

Foldable devices, by contrast, are the biggest shift to come to the smartphone since the whole industry shifted to a single slab of touchscreen glass following the success of Apple's iPhone.

  • The category is rapidly evolving but not quite ready for the mainstream.
  • By making foldables the centerpiece of its fall launch, Samsung is signaling that it sees a more-than-niche future for the category.

Meanwhile: The new smart watches are an attempt by both Google and Samsung to turn the page on what has been a largely unsuccessful effort to rival the Apple Watch.

3. Meet the AIs that can write — and code

Illustration: Sarah Grillo/Axios

Two new AI models out this week show the power of artificial intelligence to read text, write it — and even convert it into computer code, Axios' Bryan Walsh reports.

Why it matters: Natural language processing (NLP) is one of the most exciting areas in AI research, with major implications for how we'll communicate and work in the years ahead.

  • But it also opens the door to a future in which you'll be able to "talk to your computer and get it to do what you're asking in a capable, reliable way," notes Greg Brockman, a co-founder and chief technology officer of OpenAI.

Driving the news: On Wednesday morning, the Israeli startup AI21 Labs is releasing a line of language-generating AI models called Jurassic.

  • With 178 billion parameters — the values that a neural network tries to optimize during training — Jurassic-1 Jumbo is the largest such model in the world, slightly bigger than OpenAI's GPT-3, which was released last summer.

How it works: Like other large language models, including GPT-3, the AI21 models have been trained on massive amounts of text, which enables the system to learn the statistical relationships between words and use that to read text prompts from users and write text in response.

  • The AI21 models, however, aim to provide a more customizable and user-friendly interface, highlighting specific functions, including headline writing, summarization, even an app to dejargonize language.
  • During an online demo, Dan Padnos, VP of platform at AI21, fed a number of stories from the Axios What's Next newsletter into the model, which was then able to produce a one-line summary — or what we here call "the bottom line."
  • It wasn't quite good enough to put me out of a job, but it was good enough to make me worry about that future possibility.

Situational awareness: On Tuesday, OpenAI itself released Codex, an updated descendant of its GPT-3 model, for a private developer beta test.

  • Codex was trained on both huge amounts of text and billions of lines of publicly available computer code.
  • Users can issue commands in written English, and Codex will produce computer code capable of carrying out those instructions, essentially making it an English to computer code translator.

Read the rest.

4. SoftBank to "wait and see" on China's techlash

China's regulatory shakeup is causing even one of its biggest believers —SoftBank — to take pause, Axios' Kia Kokalitcheva reports.

Driving the news: "We don't have any doubts about the potential of China but again, new rules are being implemented, so until it gets settled, we want to wait and see," SoftBank CEO Masayoshi Son told analysts during the company's quarterly earnings presentation.

  • While Chinese investments make up 23% of SoftBank's overall Vision Fund investments so far, only 11% of those made in the last quarter are in China, Son pointed out.

Why it matters: Beijing's crackdown on a number of sectors and companies — including newly public ride-hailing giant Didi, one of the Vision Fund's big bets — has rattled investors and put some upcoming IPOs on ice.

Go deeper: China's homegrown techlash

5. Take note

Trading places

  • Mohammed Attar, formerly of Twilio and SendGrid, joins customer communications startup Front as its first chief product officer.

ICYMI

6. After you Login

Baby-related pranks are always a little risky, but this one is pretty darn good.