I picked a bad day to restart my substack

Moving beyond pandemic economics to innovation and technology

Long-time readers of this newsletter know it was launched during the Covid-19 pandemic and was devoted to examining the economics of pandemics. It had the title ‘Plugging the Gap’, reflecting the idea that information was the key to controlling pandemics.

Like all of us, anything pandemic represented a, fortunately, temporary move away from normality. For me, it was moving away from my work on innovation, entrepreneurship and technology, especially as it related to digital industries. When this newsletter stopped arriving, it was because I had left the pandemic behind and was moving on with my normal research.

In the meantime, Substack came up with a way for me to restart my newsletter based on my broader interests and also give my readers control to subscribe to just the bits of me they found interesting. The default, of course, was to email all subscribers, as I am doing now. But if you only cared about what I had to say about pandemics, you can easily unsubscribe from the other stuff.

So today, I am launching ‘Mess and Magic,’ my newsletter about the economics of innovation, entrepreneurship and technology. In the immediate future, that will mean lots of writing about artificial intelligence. This is because I have two books on the subject, including one, Power and Prediction: The Disruptive Economics of Artificial Intelligence, co-authored with Ajay Agrawal and Avi Goldfarb and published last November by Harvard Business Review Press. ChatGPT has really captured our attention, and there is a lot to write about. For a taste, here is a talk I gave recently on the subject to the Economic Society of Australia.

However, sadly, I cannot begin Mess and Magic with the magic. Instead, I am forced to address a rather big elephant in the room.

Twitter consciously uncouples Substack

The idea of substack is that writers attract readers who subscribe and then receive email newsletters that they can read (or not) at their own leisure. But it is not supposed to be a unidirectional form of communication. The hope is to “add to the conversation.” That might happen when subscribers forward newsletters via email. But it also happens when subscribers post newsletters and reactions to social media. You can do it now by clicking the share button.

That will take you to all of the usual suspects — Facebook, Linkedin and Twitter. But with Twitter, as of yesterday, something strange happened. Yes, you can share a link, but if users click on the link, this comes up.

The vast majority of Substack posts do not fall on the bad side of Twitter’s URL Policy. So this is basically a lie. What is really going on here is that Twitter is breaking all interactions with Substack. Not only can’t you link to posts, but you can’t reply to or retweet those posts. In other words, Twitter now prevents you “adding to the conversation” through Substack.

This is all Twitter’s doing, and like many things for Twitter these days, it just happened. No announcement. No explanation. It left Substack, for one, confused.

Why would Twitter do this?

No one quite knows why Twitter would do this. After all, breaking links and interactions is about as un-Internety a thing that you can do. The whole point is to avoid siloing information and activity. But that is a philosophy and not a law (although s230 in the US codifies an aspect of that philosophy). For-profit companies are going to do what they are going to do.

Therein lies the puzzle: what’s in it for Twitter? On the face of it, people might come to Twitter to post substack links and also to find out what substack links are interesting. They might discuss those newsletters on Twitter much as they might discuss the news or what’s happening in The Mandalorian. In other words, substack is content that seems to add to Twitter than subtract from it.

The response to this might be — “ahh now you don’t get it. Musk is playing some 12 dimensional chess strategy here beyond the understanding of your minuscule mind.” Well maybe. But last time I looked, I was an expert in digital platform strategy, particularly as they relate to media, so I am going to give this a try.

Let’s assume that this is all about the money; that is, Musk is looking for ways to make Twitter a profitable and sustainable business. In that case, breaking up with Substack may have some short-run pain, in return for which is some long-run gain.

What is that gain? Twitter has two ways it can make money. The traditional one was to sell off eyeballs to advertisers. The other way was to get the eyeballs to pay. Either way, you want more eyeballs.

As I have already pointed out, breaking Substack won’t, in the short-run, get more eyeballs on Twitter — indeed, probably the opposite. But what about over the long-run? The story there is that Substack is some type of long-term threat to Twitter and will eventually win eyeballs at Twitter’s expense. Attention is scarce, so that is certainly possible.

As it turns out, just a few days ago, Substack introduced a new feature called Notes. I haven’t had a chance to check it out yet, but the commentary around it was interesting.

People looked at Notes, and what they saw was Twitter. It stands within reason that Twitter saw this too.

So the potential logic, therefore, is: Substack Notes allow writers to gain a Twitter-like experience but not on Twitter. That relies on Substack writers attracting users to Substack. One of the ways Substack writers attract users is via Twitter. Ergo, Twitter must make them stop.

I guess that is a logic on a low-dimensional level. Twitter does this. Notes fail. Substack cancels Notes and, nose bloodied, keeps well away from Twitter feelings.

But when we look at higher dimensions, that outcome isn’t so obvious. The alternative is that Substack with Notes, now in hand and launched, receives a boost because they, too, were competing with Twitter. Substack authors stop bothering with Twitter and interact on Notes. Twitter users realise this and open the Substack rather than the Twitter app when they want to interact on the issues of the day. Twitter effectively is shooting itself in the foot just when Substack needs the boost. I, for one, am going to try Notes precisely because I want to see this newsletter grow, and I can’t use Twitter for that. In the alternative world, I would not have bothered.

Substack substack substack!

It is hard to know if all of this is going to continue. Twitter operates like a chaos monkey these days and the ban may be lifted. Who knows? For the moment, we have nothing to lose by just saying “substack” on Twitter all of the time.

I, for one, would rather be talking on Twitter than about it. In the meantime, my hope is to arrive in your inbox once, or maybe, twice per week with some more substantive posts that reacting to the petty squabbles taking place today.