I was discussing better ways to pay writers on Notes. People liked the idea, so I wrote it up here. Feel free to skip if you are not interested in this subject. Normal programming will resume soon.
The current payment system on Substack is limited.
A reader must subscribe to a publication to pay a writer. Some writers have other options listed on their articles, although this is not officially supported.
The subscription model is the only way Substack itself can make money. It takes a cut from the monthly or yearly amount paid to writers.
It is all or nothing. Fully support a writer or don’t support them at all.
With no middle ground I believe there is a lot of money not being spent on Substack because the threshold for any spending is high. There is no mechanism to pay modest amounts to writers or to pay them in an ad hoc way based on the material they publish.
Substack’s readers would likely support more writers if they had flexible ways to do so.
Subscription or nothing
The current system is based on a subscriber model. The threshold to act is high. You must subscribe to a person or publication with no idea if they will produce anything in the future.
There is a monthly option as well as yearly. This works fine if you like a publication and want to support it over time. But because it requires a commitment from the subscriber people are naturally cautious and almost certainly support fewer writers than they’d like.
Many writers add a link to a third-party service that offers small-value transactions.
These take the user outside the Substack ecosystem, an immediate barrier. Most probably don’t bother. But the idea is reasonable.
Pay for articles you like
An alternative is to enable individual payments for articles. Call them tips if you wish.
An automated mechanism within Substack to pay a writer for an article you enjoyed reading, the amount decided by the reader. No signing up for a subscription if you just want to show appreciation for a well-written piece of work.
For this we need a slush fund a reader creates. A store of Substack dollars to spend on writers.
They can dole out payments in set amounts, perhaps in 50 cent blocks. You read a great article, you don’t quite want to commit to a full on paid subscription, so pay them $1 as a thank you.
This would allow writers and publications to receive additional money on top of normal subscriptions. It would encourage readers to reward great writing on the spot while managing all the awkward aspects of online payments like fees and credit cards (see below).
How would it work?
Readers put money into a slush fund. They buy this from Substack much as they buy a subscription. The payment mechanisms are already in place.
Use a single currency regardless of the location of the writer, probably US dollars.
Charges could be paid by the reader at time of purchase so the writer gets the full amount the reader wants to give them. This makes microtransactions more manageable as one of the criticisms of small payments is the various deductions make it unworkable.
Example:
I want a $20 slush fund to pay writers
I pay the transaction fees at time of purchase, say $22.50 in total, all clearly marked who gets what; Stripe get some, Substack get some, the rest is mine to spend
The full $20 is then available to give to writers
When I find an article I like I click the payment button
I pay a writer 50 cents or $1 for a great article; so can millions of others
That’s it. There could be fixed block amounts, perhaps 50 cent increments with an option to pay any amount.
I can top up my slush fund ad hoc or using a monthly payment.
The benefits
The main benefit is additional payment mechanisms beyond subscribing. Subscriptions are a serious commitment, so we tend to have very few people we pay.
A slush fund can pay lots of writers small amounts as we work our way around Substack.
Viral pieces that occasionally emerge could make a writer much more money than they might get from subscriptions.
Streamlined ad hoc payments could open the door to greater support for good writing. Many of us cannot afford to subscribe to all the writers we like, but we would reward them from time to time for some great piece which is better than nothing.
Finally, lowering the threshold to paying writers will almost certainly attract more cash into the Substack system since it would be purchased in blocks. The funds would lie about in slush funds for a while before being paid to writers, an opportunity for Substack to make interest as another source of funding. It all helps keep the lights on.
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I don’t know any of the people at Substack. If you do you could perhaps help by making this piece known to them and anyone else that may be interested.
It’s a good idea, but I’m struggling to see how it would be able to facilitate laundering billions of stolen tax dollars to fugitive apparatchiks from the Biden regime?
Excellent idea! I can think of lots of writers whose work I enjoy sporadically and would be happy to tip but not subscribe. We are heading into retirement and $5-7 per month adds up quickly.