Substack is already far, far more paywalled than Medium ever was. Subscriptions are the business model.

Advertising works there because of the numbers. People will quickly consume enough bite sized content to drive traditional numbers.

Medium broke the things that made them appealing in an attempt to sweeten the advertising sell, but this made the platform unappealing. It was a self inflicted wound.

To be more specific, advertising works there because of the feed algorithms. The platforms gather data about user interests and use that to tune what they choose to show the users, favoring things the algorithms suggest will get more "engagement". In turn, they sell ads on those favored items. On top of that, they charge both users and advertisers a premium to be featured on the favored topics.

Take away the algorithms that determine what content and ads to feature, and you get back to the basics of blogging websites. You get happier users, but no advertising money.

This is a classic case of VCs corrupting an industry with money that’s really not needed at valuations that really can’t be supported.