You’re a media company now

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BARBARA PENG: Technology can move incredibly quickly, but in a company, the rate of digestion of that change is actually the sweet spot you really have to focus on. It doesn’t matter if the capabilities are well ahead. If your organization isn’t experimenting, is afraid of it, or you’ve banned it because you have no clue what it does, no one’s ever going to progress.

BOB SAFIAN: That’s Barbara Peng, the former CEO of Business Insider. We don’t often have recently departed execs on this show, but I wanted to have a clear-eyed discussion with Barbara about the state of the media and journalism business as we head toward the U.S. midterms and AI impacts everything. Barbara shares what she loves about journalism, as well as her business critiques, and even gives me an opportunity to express some of my own philosophy about how to operate in an AI world. So let’s get to it. I’m Bob Safian, and this is Rapid Response. I’m here with Barbara Peng, former CEO of Business Insider. Barbara, welcome to the show.

PENG: Thank you, Bob. I am very happy to be here with you today and looking forward to the conversation.

SAFIAN: The media business is so hard these days. Do you feel relief being off the hook for finding cash flow for Business Insider every day, or do you miss it?

PENG: What do you mean it’s hard? No, I’m teasing. Listen, it is one of the most challenging times in media right now. Literally everything is changing. I don’t think there’s a single thing that is constant right now. I love a little crazy, a little chaos. That’s my sweet spot. But I’m definitely a little more relaxed, Bob. I feel pretty good right now. So yeah, there’s some of that too.

Copy LinkBarbara Peng reflects on her time at Business Insider

SAFIAN: How would you assess your tenure at BI now? What would you do differently? What are you most proud of?

PENG: When I first stepped in, Business Insider was one of the original digital darlings. We had flexed, like a lot of other organizations, to be very broad and wide and focused on lifestyle. One of the first things I did was take us back to Business Insider, refocus us on business, tech, and innovation. That change in direction was really important. You really cannot be everything to everyone, especially when there’s so much opportunity and so many things you could potentially do. Picking the things that you’re great at and leaning into them is so hard, but it’s so important, and I think that is very much the bar right now. As a leader, I think you always have to do the hard thing. We all want to be liked and loved, and change is hard. But I think that is your responsibility: to make those tough calls, doing them with as much empathy, thoughtfulness, and authenticity as you can.

SAFIAN: Are you alluding a little bit to some of the layoffs that had to be conducted?

PENG: Yes. Pretty much the absolute worst part of being a leader, the decisions you have to make. Nobody wants to do that.

SAFIAN: And the classic questions: Why’d you leave? What are you doing next? Are you tired of addressing those?

PENG: I’ll address them for you, Bob. We’re at a really unique and special moment right now, where technology, innovation, and the opportunity are massive. My background is engineering. I went to MIT, and it seemed like there was an urgency around that. There are a lot of different companies right now that are at the heart of really creating what the foundation of the future will be. So this is really the perfect time for a new chapter and to jump in there.

SAFIAN: In your thank-you note to the BI staff, you pointed to both massive change and massive opportunity.

PENG: Yeah.

Copy LinkWhy media must adapt faster to AI

SAFIAN: So far, the opportunity side seems to be falling more to the AI firms and tech firms. I saw something that you said in a talk at MIT earlier this year: that media is not particularly innovative as an industry. Unpack that for me a little bit, because sometimes I think media gets hit by tech change before other industries and is forced to constantly change.

PENG: I think if you go to major media websites, a homepage looks pretty similar to what the front page of a newspaper looked like. A lot of the core form-factor DNA of media has not changed. Especially with the impacts of AI, I think our industry is very hesitant to embrace it. That’s the nice way of me saying that I don’t think they like it at all. My hope for media, my hope for publishers, is: be brave and bold. I think the space is there to figure out what the future of journalism is. It’s not the first time, though, that media has had to adjust to changing consumption habits and find its audience. The move to digital and figuring that out was very different, right? So I think the premise is the same: You’re constantly trying to find where your audience is, how to reach them, and how to serve them.

SAFIAN: And the skepticism around AI, did you feel that more from the journalists? I certainly hear journalists are skeptical and cynical about everything. That’s part of why people go into doing it. But was that skepticism also on the business side?

PENG: I do think the skepticism, or the feelings about AI, are universal. The conversation around AI sometimes tends to be very binary, but there’s actually a huge amount of nuance between those two poles in figuring out how AI can help support the process and the work, where you are creating journalism that people want to read, that is helpful and thoughtful. Figuring out the ways that AI can support it is part of the experiment, part of the risk-taking. I started my business career as an analyst. There was a huge amount that I had to do that was like cut and paste in Excel. It was probably a week in, and I was like, “This is terrible.” I had heard that there was this programming language, which I don’t even know if it’s still around, VBA, where you can actually automate all of this. So I learned VBA. I automated the incredibly rote parts of my job. But I also remember some of my colleagues being like, “What are you doing? Why are you doing that?” I think in this moment, figuring out where AI can help us is part of the experiment and part of the risk-taking. I was chatting with an executive this past weekend whose background is product and engineering, and he was saying the models are moving so fast, capability is moving so fast, that if he gets stuck, he actually sends an invite to himself on his calendar for a month in the future to try it again. So I’ve been trying to catch up, spend more time, and really get into it.

SAFIAN: Your team introduced an AI-powered paywall at BI, which helped new subscriptions rise a fair amount. Is that the signature business-impact example you point to about AI innovation, where you think media should be paying more attention?

PENG: That is a great one. That had very clear returns for us. We had moved from a metered paywall to an AI-powered one, so it wasn’t just about how many times you came to the site. It was about being really thoughtful about your propensity to subscribe, what piece of journalism you were looking at, and finding the right time to serve a paywall, which is just a much better customized, personalized experience for the reader, but also performs much better. We experimented with a lot of different product experiences. We were the first publication to launch generative AI search. We tested out a lot of different capabilities, even with audio and gen AI audio, on our homepage, which was great because it boosted engagement. Starting early and figuring out, “Oh, this works for us,” or, “This doesn’t work for us,” helps hugely because it puts us on the path and ahead, versus either being late to the game or dragged along.

SAFIAN: When Barbara says that AI skepticism is universal, from journalists and from businesspeople, it highlights both the risk and opportunity of this moment. So how do media brands maintain trust with their audiences, and when is it OK to take risks? We’ll talk about that and more after the break. Stay with us.

[AD BREAK]

Before the break, former Business Insider CEO Barbara Peng talked about the hard decisions facing media execs right now. Now she talks about building trust as a brand. Plus, she gives me an opportunity to share my personal perspectives on dealing with AI. Let’s jump back in.

I wonder whether you’ve had time to reflect at all on where the business model of journalism is moving. Historically, it’s been heavily reliant on advertising, in print and then in digital. Now we’re seeing more emphasis on subscriptions, even on content licensing deals with AI companies. But it’s kind of a struggle to make that new math work. I talked with The Guardian CEO, Anna Bateson, about the benefit of being owned by a trust as a nonprofit. Another alternative, increasingly, is relying on a deep-pocketed billionaire, which was the case at Fast Company when I was there. Do you have clarity about what the best options are? Do we know yet?

PENG: Yeah.

PENG: I don’t think it’s one size fits all. Remember when everybody wanted to be a subscriptions product? How did that work out? It sounds great, recurring revenue, but it really only works if people are coming back to you time and time again. I think people are in journalism because they love and support journalism. You can go to tech and make more money. You can go to other industries where the margins are higher. The goal for media and journalism is sustainability. How do you find a model for the long term? I think we have a couple more years here, and a lot more disruption, before we settle into what exactly that world looks like.

Copy LinkHow journalism can rebuild trust over time

SAFIAN: One of the challenges is declining trust in news sources and journalists. All brands and all businesses are facing issues of declining trust. Do you have any philosophies about how you reestablish trust, especially when the financial requirement seems to be competing for attention?

PENG: What’s rewarded in the attention economy is not really one of the most important things for media to lean into. It is absolutely a problem. If I had the solution, I would scream it from the rafters. Trust is built over time. Consistency is a big part of trust, as is transparency. It’s like, “Oh, you’re going to write about clients, and you’re going to say things that are tough that they don’t want to hear, but then you’re going to ask them for money? What? That sounds like a terrible business proposition.” But loving journalism and understanding it, I think you just have to understand that and be in it.

SAFIAN: It is counterintuitive sometimes that saying things that are critical of a business partner might actually be good for them.

PENG: Yeah.

SAFIAN: That just makes people trust everything else you say that much more. That’s in your interest. If you have a conversation like that with a potential advertiser, do they get it or not?

PENG: Listen, I think most people get it. Does it mean that they won’t be upset about it, or that you don’t have to have a conversation? Different story. Every organization out there has lost a big client forever, or for a short amount of time, because of something somebody wrote. I think that’s just par for the course.

SAFIAN: It’s just so ironic, right? Because the reason they want to partner with you is because you’re trusted. The reason you’re trusted is because you say you have difficult conversations. But if one of those difficult conversations is about them, they get disappointed, whereas actually that’s exactly why they should most want to be with you. I know I’m preaching to the choir here.

PENG: Absolutely. I actually do have a question for you.

SAFIAN: Sure.

PENG: What are your feelings on AI and its capabilities to help you and to help media?

Copy LinkWhy resisting AI is the wrong strategy

SAFIAN: When I talk to different sources for this show, you get both people who are like, “This is changing everything,” and people who are like, “This is wildly overblown. It’s hype,” or, “It’s a bubble,” or whatever. I think both of those things can be true at the same time. The way I think about AI is that whether I like it or not isn’t relevant. It’s real. It’s happening. It has a certain momentum, and I have to adapt myself to the reality, and every business has to adapt itself to the reality of what is changing. For some industries, that happens faster than others, and it’s not necessarily going to have the impact that some people say it’s going to have immediately. Whether AI is going to end the world, there are a lot of things that could end the world that we’ve had for decades sitting in silos all over the world. So yes, there is absolutely risk, and I think the more conversation we have about the risk, the less risky it becomes.

PENG: I guess. Yes.

SAFIAN: I will say that I don’t think we understand how AI really works, even the folks building it. There are these great euphemisms that they use in Silicon Valley to describe interpretability, or whatever these words are, that basically mean, “Yeah, we don’t really know what it’s doing.” Every time they explain that an AI agent jumped out of a sandbox, they’re guessing how that happened, but they don’t really know. So there is a certain Pandora’s box element to this, but fighting it is like fighting gravity.

PENG: Buckle up.

SAFIAN: It’s happening.

PENG: Very pragmatic.

Copy LinkHow leaders help teams absorb rapid change

SAFIAN: It’s happening. What do you think business leaders need to understand to operate in today’s uncertainty?

PENG: Technology can move incredibly quickly, right? But in a company, a society, or what have you, the rate of digestion of that change, of adoption of that change, is actually the sweet spot that you really have to focus on. It doesn’t matter if the capabilities are well ahead. If your organization isn’t experimenting or trying, or is afraid of it, or you’ve banned it because you have no clue what it does, no one’s ever going to progress. So thinking about how I make these technologies accessible to my organization, how I tell them that it’s OK to take risks, that sweet spot of culture really dictates how much you can transform, change, iterate, and innovate. I actually think media right now is intersecting with pretty much every industry. Everybody is thinking about how you connect with your audience, how you tell your story, and how to be in the right place. So I do think the definition of media is changing.

SAFIAN: What you’re saying is every business these days has to be a media business because of the way they’re managing their brand and interacting with their customer.

PENG: A hundred percent. I think you absolutely have to understand digital distribution, how to reach people. You need to understand AI. All of that is universal now.

SAFIAN: Barbara, this was great. Thanks so much for doing it.

PENG: Thank you for having me, Bob. It was a pleasure.