State of the Media

March 25, 2009 | Written by

Is the media dying? "Evolving" might be a better way to describe it given a terrific "State of the Media" memo my Ruder Finn Corporate Communications colleagues drew up today.

I’ll spare you the proprietary research parts, but below are some of the highlights that may be relevant from a digital business trends perspective:

As noted in the February 5th issue of TIME, last year more Americans got their news online for free than paid for it by buying newspapers and magazines. As a result, across the board print circulation has dropped and so has advertising revenue. For example, in the last six months of 2008 newsstand sales of Newsweek fell more than 13 percent.

This wave of staff cuts began prior to the economic downturn in 2008. The number of full-time journalists working at America’s daily newspapers shrank by 4.4 percent in 2007, the largest decrease in the past 30 years.

(Left Brain editor’s note: what hasn’t experienced the largest decrease in 30 years lately?)

Many of the traditional news outlets have been forced to rethink their format and coverage…Brian Kelly, editor of U.S. News & World Report, still believes in the newsweekly concept, but feels that the delivery method needs an update: "To produce a great report, close the magazine on Thursday night and then readers don’t get it until Monday — that’s insane." To address this reality, the publication will print a monthly issue and will have a digital weekly edition available as a downloadable PDF for its subscribers.

When the decorating magazine, Domino, folded in early February, Charlie Rutman, senior adviser to MPG North America, a media buying company, observed that:"The magazine industry in every category is under extreme pressure, extraordinary pressure, for a lot of reasons: the Internet, the cost of subscriptions in a tough economy, the tough economy, you name it. By the way, there probably are too many magazines, but if companies can’t survive these kinds of pressures we’re not going to have any magazines in the future."

It’s not just the print properties of media companies that are in crisis as advertising also funds online and broadcast media outlets. In February Ad Age reported that U.S. online advertising spending is about to contract. In broadcast, ad spending has already dropped.

Change is Permanent
While the economic recession has played its role in these grim turn of events, some predict this change is permanent…The Wall Street Journal reported on analyst opinions that "big write-downs reflect poor capital allocation on the part of media companies over the last decade and a recognition that declines in the value of their businesses are likely permanent."

Does anyone see a silver lining to all this doom and gloom?