The state of the news media: Time running out to find a new business model
It's tough to find any optimism in the latest report prepared by the Project for Excellence in Journalism on the State of the News Media in 2008.
The numbers gathered in the 200,000-word analysis describe an industry in serious free fall: ad revenues down 23 percent in the past two years; nearly one out of every five journalists working for newspapers in 2001 now gone; local TV ad revenues down 7 percent last year, during a historic election filled with television advertising buys; half of all revenue from classified advertising in newspaper gone, with some experts predicting revenue could fall to zero in five years.
(UPDATE: Adding to recent jarring news, the Seattle Post-Intelligencer told staffers today that the newspaper will cease making a print edition on Tuesday, going online only with a severely reduced staff.
AND: The Tucson Citizen, a 140-year-old newspaper owned by Gannett Co. is closing Saturday, after the company attempted to sell the paper and found no buyers -- the same fate that led to the closing of the 150-year-old Rocky Mountain News last month.)
Their bottom line: Advertising, which once was enough to support almost all types of major media journalism outlets, now seems inadequate for the task. And news outlets hit hard by the recession are struggling to find a new way to pay for the news reporting so many take for granted.
"Journalism now has less time left on the clock to invent a new business model so it can survive," reads one summary of the report provided to journalists. The report itself breaks down a number of areas of media, including network TV, newspapers, online, local TV, magazines, ethnic media, a survey of online journalists and more.
Several important points emerge from the PEJ study:
* A growing audience migration to the Web-- the number of Americans going online for news jumped 19 percent in two years, according to one survey -- is forcing traditional news outlets to reinvent themselves sooner.
* The general recession has likely doubled the revenue losses for the news industry in 2008, curtailing outlets' ability to find new sources of revenue, as companies downsized and cut back just to survive.
* Advertising is decoupling from news; though traditional news outlets have more readership than ever (factoring in online users), online advertising likely will not produce enough revenue to offset losses elsewhere.
* The public debate over solutions may be focused on the wrong ideas. Charging micropayments for existing content or trying to get funding as nonprofits seems impractical -- users have proved to be resistant to paying online and the general news media's scope is too broad for the nonprofit strategy to work. (The St. Petersburg Times is a for-profit business owned by a nonprofit, which is a different structure.) An array of several smaller strategies seems more likely.
* Power is shifting to individual journalists and away from institutions.
* The audience for local TV news continues to drop, with viewership for early evening newscasts down by an average 4.5 percent last year.
* The news agenda has narrowed: The two biggest stories, the presidential campaign and deteriorating economy, filled half the news hole last year -- almost twice the amount filled by the two biggest stories the year before.
* Cable news was the only medium that saw big wins in 2008, increasing audiences by 38 percent and profits by 33 percent, largely by focusing on the presidential election. It also elevated minute-by-minute judgment in political journalism, making coverage more reactive and less enterprising.