Lessons from the Failure of Readability’s Author Payment Plan

Yesterday Readability announced that they were shutting down their experiment to take payments on behalf of authors and then distribute them (minus a 30% cut) to those authors. The announcement talks about learning from the experiment, the main learning being that while readers seemed to like the model, it was impossible to get enough publishers on board.

For one thing, most authors in the long tail of content that flows through Readability have no idea that Readability even exists. But another big factor was that many authors who did know about Readability reacted angrily to the model. It seemed presumptuous of Readability to collect payments on the behalf of authors, without said authors ever agreeing to the model. Some prominent authors expressed their anger. Daring Fireball’s John Gruber called Readability ‘scumbags’.

Fanning the flames of the subsequent disagreement on Twitter and in the blogosphere were two Internet heavyweights and Readability advisors, Anil Dash and Jeffrey Zeldman. Both are held in very high regard because they have a record of actively pushing the web forward. Dash focusing on its potential for positive cultural impact, and Zeldman on advancing web standards. In this context it is easy to see why they would be attracted to Readability. The service is tackling the hard problem of finding new business models for authors, and it is making the web a better experience for readers.

The problem: These noble goals have blinded Readability and their advisors to the extent that their sense of entitlement regarding other people’s content angers the people that created that content. So I suggest that there are two important things to learn from the kerfuffle surrounding the Readability payments system.

The Sting of Entitlement Matters More than Money

Dash has repeatedly and correctly pointed out that Readability is not the only company to derive revenue from a read-it-later service. Competitors Instapaper and Pocket do much the same thing for their users. On the face of it Readbility, which tried to compensate publishers, should be more popular with authors than competitors who make no attempt to do so. Right?

Wrong. It turns out that many authors care less about the money, and more about the fact that Readability is representing them without their consent. As a publisher, I understand this reaction and it isn’t entirely rational. Even if the financial outcomes were equivalent for Readability and Instapaper, and even if the user experiences they offered were identical, I would find it easier to accept Instapaper deriving direct benefit from someone buying their app than to accept Readability deriving benefit from collecting revenue on my behalf.

The Readability model just felt dishonest and entitled. Although I thought that John Gruber’s ‘scumbags’ comment was over the top, it perfectly captures the way I feel about Readability in the pit of my knotted stomach whenever I think about their payment plan.

Product Developers Will be Held Accountable

With hindsight it is clear that Readability’s model was impractical because there is such a long tail of content and authors. So now there is nearly $150,000 in a bank account, most of which won’t make it to authors.

Readability made a promise to their customers — that they would compensate authors — and now they can’t deliver on that promise.

Much of Readability’s defense of this failure, and particularly Zeldman’s defense of Readability’s actions, centers around the fact that they are trying to do something good for readers and for authors. But even if the Readability team was entirely motivated by the altruistic goals of improving reading on the web and finding a better business model for authors, it wouldn’t matter. It isn’t Readability’s goals that anger authors. It is their actions.

The lesson is that trying something novel, even with good intentions, does not give you a free pass. As a product developer you will be held accountable for the outcomes related to your product. If you fail, you will have people to answer to and “but, I was trying something good and cool” will probably not be sufficient to get you out of hot water.

Lessons: Unlearned

Readability’s approach to shutting down the payment plan illustrates that their take on the lessons from the failure of the payment model is very different to mine.

First there is the unilateral decision regarding how to deal with the unclaimed payments. Depending on how you look at it, this could be the authors’ money or the readers’ money. Deciding what to do with it without consulting authors or readers shows the same sense of entitlement as collecting the money on the authors’ behalf in the first place.

The decision to explain things in terms of the failure of an experiment, instead of apologizing for getting things wrong, shows a belief that startups can take money from customers without being accountable for delivering what they promise in return.

Then there is their decision to give the money to “non-profit organizations that speak to the spirit of supporting reading and writing”. The implication is (1) that the positives of giving to a non-profit outweighs the negatives of their entitlement in making that decision unilaterally, and (2) that this is some measure of compensation for the failure of the model.

But the end doesn’t justify the means. Giving to charity may well be the only practical way forward, but that doesn’t mean everything’s ok. Without a clear and explicit acknowledgement that this was a flawed idea that failed, and a sincere attempt to involve authors and readers in their decisions around what to do with the money, the flames will continue to burn.

Bridges: Burning

Reading the comments on the announcement post, it is clear that there are both trolls and reasonable people calling foul. Unfortunately, Zeldman’s passionate, angry defense of Readability seems to be directed at both and is rapidly diminishing their chances of making things good.

I can get over being called a troll by my erstwhile heros of the Internet. But I do wish that folks at Readability were internalizing more of the real lessons here. This episode shows all the hallmarks of a classic PR stumble — a sense of denial, underestimation of the concerns, angry surrogates digging the hole deeper — and they will be the biggest losers when it all dies down.

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