Substack, once firm in its ad-free promise, is reconsidering advertising as a revenue stream due to the financial pressures of platform growth. Co-founder Hamish McKenzie indicated that while ads could potentially enhance profits, they pose risks by possibly alienating trust among users. Research analyst Jamie MacEwan noted that ad revenue could lower subscription costs or improve profit margins, especially in a competitive newsletter market. This hesitation echoes a broader trend, where various platforms have shifted from anti-ad policies to embracing them for financial sustainability.
"For us, advertising is an interesting business. Maybe some way off in the distant future," Hamish McKenzie stated, highlighting Substack's consideration of ads despite previous resistance.
"Ad revenue can help subsidize lower subscription fees or bring a newsletter into profit," said Jamie MacEwan, referencing the potential benefits of incorporating advertising for sustainability.
Substack's potential pivot to advertising mirrors a trend seen in other platforms that initially resisted ads—now reconsidering for financial viability as competition grows.
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