What is the State of the Media in 2010?

A year ago, we were still building SaveTheNews.org, writing our first major report and holding early meetings with journalism leaders about the future of news and public policy. Our DC meeting included folks from the Pew Project for Excellence in Journalism, who gave us a brief snapshot of their 2009 State of the Media report. It was an optimistic presentation, emphasizing the dramatic growth in news readership and the exciting new online news ventures developing all over the country.

This year’s State of the Media report, released yesterday, paints a much different picture. The brief summary is that newsroom cuts and dwindling budgets are still wracking the news industry, and new business models and nonprofit journalism projects are not developing fast enough to fill in the gaps. While the report does not address public policy directly, there are a number of important findings that highlight how bad policies have undermined journalism, and suggest ways new policies could help meet the information needs of communities.

Below is a summary of a few of the key points that I am still mulling over.

Staffing, Budgets and Capacity for Original Reporting (i.e. quantifying what we have lost)

There were few surprises in Pew’s accounting of job losses across the media industry, but it is worth noting that the cuts have been so deep that Pew suggests that “Even if the economy improves we predict more cuts in 2010.”

Here are the stats: “We estimate that the newspaper industry has lost $1.6 billion in annual reporting and editing capacity since 2000, or roughly 30%. That leaves an estimated $4.4 billion remaining. […] Network news division resources are likely down from their peak in the late 1980s by more than half. […] Local television is harder to gauge, but one estimate puts the losses in the last two years at over 1,600 jobs, or roughly 6%.”

What About the New Online News Projects and Models?

Every report released in the past year has heralded this new age of experimentation in journalism and celebrated its pioneers. However, amidst that hope there has been a growing consensus that these new projects can not yet match what we are losing in reporting capacity across the nation. Indeed, even more fundamental questions have arisen about the capacity of individual and foundation philanthropy to ever fully fund the full extent of news and information needs of our society. This leads to important questions about the potential role of public policy to support quality journalism and public media.

This year’s State of the Media report reinforces that idea, “For all the invention and energy, however, the scale of these new efforts still amounts to a small fraction of what has been lost.” The authors point to a J-Lab study which found that “roughly $141 million of nonprofit money has flowed into new media efforts over the last four years (not including public broadcasting). That is less than one-tenth of the losses in newspaper resources alone.” Based on their research, the authors conclude that, “Unless some system of financing the production of content is developed, it is difficult to see how reportorial journalism will not continue to shrink, regardless of the potential tools offered by technology.”

Ads and Online Business Models

Last year the authors of the State of the Media report famously wrote that journalism’s core problem is a revenue problem, not an audience problem. This year’s report echoes that sentiment, but the search for new online models and the hope for online ads seems more insurmountable this year. The Pew report notes that “Newspapers, including online, saw ad revenue fall 26% during the year, which brings the total loss over the last three years to 43%. Local television ad revenue fell 22% in 2009, triple the decline the year before. Radio also was off 22%. Magazine ad revenue dropped 17%, network TV 8%.” Ad revenue in the online space fell less, but still dropped by about 5%, and Pew suggests “revenue to news sites most likely also fared much worse.”

Pew also looked at consumer behavior related to online ads and news websites – and the results don’t provide many useful leads to build a business model around. “79% of online news consumers say they rarely if ever have clicked on an online ad. 65% of online news consumers do not have a site that is so important to them that it stands out in their minds above all other sites they visit. Yet even among these most loyal news consumers, only a minority (19%) said they would be willing to pay for news online. Instead, a large majority – 82% – of those with a favorite site said they would find somewhere else to get the news.” In the end, that means roughly 7% of online new consumers would be willing to pay.

The only bright spot in this part of the report was cable news, which did not suffer ad revenue declines and maintained steady traffic to their online sites. The lesson here seems to be, that we can rely on ads if we want all our news to look like Fox, MSNBC, and CNN. That’s not a pretty picture.

Stay tuned – we’ll continue the discussion around the public policy implications of the Pew Project for Excellence in Journalism’s State of the Media 2010 here at SaveTheNews.org.

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