January 4, 2017 Last Updated 9:30 am

Medium lays off 50 as it gives up on digital advertising model

‘I’ll start with the hard part’ wrote Medium CEO Ev Williams in a blog post today. “As of today, we are reducing our team by about one third — eliminating 50 jobs, mostly in sales, support, and other business functions. We are also changing our business model to more directly drive the mission we set out on originally.”

The news was part of an announcement that Medium was giving up on advertising.

“(I)t’s clear that the broken system is ad-driven media on the internet. It simply doesn’t serve people.”

But no one lays off sales people when sales are great, only when they are not, and web rivals have continued to report record sales, and the IAB continues to report record digital ad spending. So, really, the problem isn’t the model, it is performance, right? It is very hard, maybe impossible, to compete against Facebook and Google when it comes to digital advertising.

Or maybe the problem was that Medium was doing a poor job of presenting itself. In the spring of last year Williams admitted as much.

“We don’t have an advertising product right now that people can sign up for. We have a bunch of brands, though, that use Medium as part of their content marketing efforts,” Williams told AdAge.

Medium was not selling display advertising, despite some reporters being confused about this. Instead, their model was native advertising, which is a more complicated sale, and one that involves direct selling. Good luck hiring a sales team that can step right in and sell it. And besides, who wants it? (Some journalists, apparently.)

Where Medium goes is hard to understand. Williams said “we are shifting our resources and attention to defining a new model for writers and creators to be rewarded, based on the value they’re creating for people.”

But that sounds like increasing costs, not increasing revenue.

In addition to the layoffs, Medium will be shutting down its DC and NYC offices.

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