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Illustration: Sarah Grillo/Axios
Digital publishing is doing something it hasn't done en masse since the dawn of the Internet: make money.
Why it matters: Business Insider, Vox Media, The Information, Axios and Politico all turned profits in 2019, in several cases for the first time ever, sources tell Axios.
The big picture: Five trends are working in digital media’s favor:
The other side: Media companies that lack true scale or dominance of a specific niche continue to face challenges. Most executives believe this trend will continue, leaving a small group of large publishers and high-quality niche sites.
Between the lines: There’s hope for the bigger publishers to reach profitability, but many have had to slash costs to get there.
Be smart: These success stories have begun to allay investor concerns. Venture investors known for expecting quick returns tell Axios that they are beginning to take a longer view of their investments in publishers that have more sustainable business models, like subscriptions.
Photo by Steph Gray, courtesy of The Athletic
The Athletic, a subscription-based digital sports media company, has raised $50 million in a Series D funding round, executives tell Axios.
Why it matters: The Athletic is considered an anomaly in digital media upstarts because it's focused on subscription revenue rather than advertising revenue.
Details: The round is being led by Bedrock Capital with participation from Emerson Collective and Powerhouse Capital along with existing investors.
By the numbers: The company expects to become profitable in 2020 and says it will soon hit a million subscribers worldwide, according to The Athletic co-founder Adam Hansmann.
The big picture: Sports media is on a consolidation wave.
Illustration: Eniola Odetunde/Axios
Amid a historic election year, and a heightened political climate, the media is looking for ways to cater to users who just want to tune it all out.
Why it matters: While some media companies and brands are leaning more heavily into politics, others are finding it helpful to give people a rest.
Driving the news: As impeachment hearings loom, advertisers are doing their best to avoid politics and to stay out of the political fray, the New York Times reports.
Between the lines: Facebook said earlier this month that it would give consumers the option to stop seeing political ads in their feeds moving forward.
The big picture: In a hyper-political era, few places have become void of politics.
Illustration: Sarah Grillo/Axios
After years of operating with minimal oversight or concern for user privacy, the advertising industry is finally beginning to adopt a privacy-first supply chain that it hopes will gain back the trust of frustrated consumers.
Why it matters: Even though the industry has banded together to push back against state privacy regulations, it's at odds over how it should proactively prepare for a more privacy-focused advertising ecosystem.
Driving the news: Two of the biggest ad trade groups, the 4A's (The American Association of Advertising Agencies) and ANA (The Association of National Advertisers), released a joint statement last week condemning Google's decision to phase out support for 3rd-party cookies in Chrome, the last major web browser to do so.
Be smart: While the industry seems split over the cookie phase-out, it is much more aligned on regulation.
Cutting support for the cookies placed by advertisers and other third parties will force the digital ad and marketing industries to be more privacy-focused, although cookie-based targeting is at this point mostly outdated.
The big picture: For decades, advertisers relied on cookies to track users across the web and to retarget them with ads, particularly on desktop. The dominance of mobile-based ads has made that tactic somewhat obsolete.
Why it matters: Some publishers fear that limits on cookie targeting will force them to depend even more on Google's ad tech for ad targeting.
Go deeper: Google to phase out third-party cookies
Illustration: Sarah Grillo/Axios
The local news crisis is hitting major cities across America, proving that big papers aren't immune from the financial pressures that are causing a near collapse of hundreds of local outlets across the country.
Why it matters: In some cases, their problems are harder to solve.
Driving the news: In a desperate plea for help, two investigative reporters at The Chicago Tribune penned a New York Times editorial Sunday, foreshadowing signs of major cuts at the 173-year-old paper, following its acquisition by Alden Global Capital, a hedge fund known for cutting journalists at local papers to maximize profits.
The big picture: Cuts to big-city papers around the country are happening parallel to an increase in ownership of newspapers by hedge funds and private equity firms that have absorbed the entities to find synergies and potentially make some cash.
Be smart: Even some national titles owned by billionaires or well-off families are struggling.
Go deeper: Cities are turning into news deserts
Illustration: Eniola Odetunde/Axios
NBCUniversal unveiled parts of its new streaming service, Peacock, to investors in New York Thursday, including details about its pricing tier, programming and ad strategy.
Why it matters: Unlike some of its entertainment rivals, NBCU plans to make its service mostly free to consumers, supporting it through advertising. Netflix and Disney, who are considered the two streaming titans to beat, are ad-free.
Twitch, the Amazon-owned video-streaming service that got its start with live vide0-gaming and esports, is expanding into other other verticals, Axios' Kia Kokalitcheva and I write.
Why it matters: So many Silicon Valley social and video upstarts debut with a niche purpose, like Twitch with live-streaming esports or Discord with chatting about esports, but eventually broaden in scope as consumers find new uses for them.
The big picture: A growing portion of the hours watched on Twitch now comes from non-gaming categories like video blogging and ASMR videos.
Between the lines: Non-gaming Twitch stars are beginning to develop widespread prominence, while Twitch gamers are becoming celebrities in areas that transcend gaming, like music, art, and video blogging, per Wired.
What's next: Twitch still owns the vast majority of hours watched on live gaming platforms, but Facebook Gaming and Microsoft's Mixer are quickly growing.
Go deeper: Esports, the new social square
Elsewhere in the C-suite shuffle: