Monday, January 28, 2019

BuzzFeed, Gannett, HuffPo All (Unfortunately) Validate Our Prediction About Media Layoffs

In our blog from Dec. 19, 2018, "4 Additional Media Trends for 2019: including 'News Fatigue,'" we noted, "Digital media isn't the sure thing it was once thought to be, despite the lack of traditional media's baggage (like lack of printing presses)."

Specifically, we predicted:
The incredible shrinking newsroom. A decade ago, most newsrooms used to employ more reporters to cover the news, and the amount of pages that newspapers and magazines had to fill was larger. Today, news reporters have to cover more news with fewer resources and less space. Locally, at the Boston Business Journal, a terrific weekly, staff reporters typically file four or so stories a day, may have a weekly newsletter they produce and then must write a longer article for the weekly printed edition. Radio reporters now also have to write up a print story for the website in addition to producing their stories for the radio. All of this is to say that there are fewer reporters and they have to produce much more. This makes it challenging for them to take meetings, cultivate sources, uncover stories that need to be told. According to the UNC School of Media and Journalism's Center for Innovation and Sustainability in Local Media, the result of all this is that "Many newspapers have become ghosts of their former selves, both in terms of the quality and quantity of their editorial content and the reach of their readership."
Unfortunately, that prediction was validated by Axios in January: "More than 1,000 media jobs lost in one day." Many of those jobs cuts were handed down by BuzzFeed, which eliminated 250 jobs; Gannett, which cut more than 20 jobs; and Huffington Post, a division of Verizon. Overall, Verizon Media cut 800 jobs, approx. 7 percent of its global workforce. Axios also noted job losses at Vox and Refinery29, two digital-only media sites.

According to Axios, the shrinking newsroom "exists at the local, national and global levels, and across digital, print and television operations." For another article about the problems of newsrooms, check out AdWeek's "Layoffs Likely to Continue in This ‘Wrenching’ Period for Media Industry."

Axios also sees the impact on "the cheap sales of websites that had raised tons of money, like and Mashable.

Those two sites are still producing interesting, good journalism but their troubles may be self-fulfilling. In conversations this past week, we were asked about getting into Wired, the Times, Wall St. Journal and TechCrunch by several new and prospective clients. But no one asked about Mashable -- which would have been on that list two years ago.

We're not trying to throw shade at Mashable; again, we're fans just as we're fans of Re/code.

Our point is this: good, credible journalism is only one factor you need to have a successful news organization.

There are a number of variables news organizations need to have a profitable, sustaining business model. You need to figure out the costs and resources (editors, reporters, tech people and infrastructure to deliver the news) and how to pay for that (paywall, phased paywall or no paywall; subscriptions, advertising, native ads and clickbait, sponsorships and underwriters for nonprofit outlets.

Unfortunately, while there are many news sites and tech news sites, very few have made it work. Which means that we expect the newsroom to continue to shrink. And we wish we weren't right about this.

We certainly don't have an answer to the business problems plaguing the news sector. But do you? Let us know if you have any suggestions.

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