New developments in the American news industry show promising signs of energy and excitement, according to the “State of the News Media 2014” report by the Pew Research Center. Even though the ground for traditional journalism is still shifting, the report concludes that there is a silver lining on the news horizon.
“The level of new activity this past year is creating a perception that something important, perhaps even game-changing, is going on. If the developments in 2013 are at this point only a drop in the bucket, it feels like a heavier drop than most.”
By relying on extensive data analysis, in-depth interviews and market research, the Pew report provides an authoritative overview over major changes and new trends in American journalism. It especially focuses on trends in digital reporting and their impact on revenue, jobs, content and consumer behavior.
In 2013, news organizations generated at least 63 billion dollars in revenue and most of that came from advertising (69%). Most advertising still goes to daily newspapers (58%) and to local television (20%). Ad revenues of digital-only news organizations are hard to gauge, according to the report, but they amount to at least 500 million dollars, less than 1% of all ad revenues. Compared to previous years, though, newspapers are still losing advertising dollars and still can’t make up for that loss with their digital portfolio. Contributions from the audience (subscriptions, cable TV fees) account for 15 billion dollars, about one quarter of the overall revenue. Again, newspapers get the largest share of that cake (69%) while for-profit digital news organizations claim less than 1%.
2013 saw the spectacular rise of digital news entrepreneurs (Jeff Bezos and Pierre Omidyar amongst others) and while the actual influx of capital is tiny compared to other revenue sources, their psychological impact, according to the report, should not be underestimated.
“They have created significant interest and buzz for an industry looking for not only an infusion of cash, but for new ideas as well. With much of this investment flowing to digital news outlets without their own legacy baggage, new ideas about how to produce and distribute journalism are being given the chance to flourish. That represents a psychological development perhaps more profound than the dollar figures alone would suggest.”
The report found that digital news outlets account for at least 5000 full-time professional jobs. Two thirds of those jobs are with the 30 largest organizations (i.e. Vice, Huffington Post, Politico, BuzzFeed). This number is still small compared to the 38,000 full-time jobs in newsrooms (according to the American Society of Newspaper Editors) and these new opportunities can’t make up for the 16,200 jobs lost in the last decade. Yet, the report observes an upward trend for hiring and even explosive growth in new digital-only organizations. It notes that much of the hiring is geared towards expanding the coverage of global news.
Digital journalism also shows some signs of filling reporting gaps in local and investigative journalism. Especially smaller digital organizations identify themselves as local or hyper-local while larger non-profits (i.e. ProPublica, Center for Public Integrity and the Center for Investigative Reporting) focus on investigative reporting—often in collaboration with traditional media.
The report indicates that a changing news landscape doesn’t necessarily lead to less consumer interest. “The year also brought more evidence than ever that news is a part of the explosion of social media and mobile devices, and in a way that could offer opportunity to reach more people with news than ever before. Half of Facebook users get news there even though they did not go there looking for it. And the Facebook users who get news at the highest rates are 18-to-29-year-olds. The same is true for the growth area of online video. Half of those who watch some kind of online video watch news videos. Again, young people constitute the greatest portion of these viewers.”
Despite all these signs for optimism, the report cautions against looking too starry-eyed into the future, especially when it comes to digital-only outlets. “For all the expansion,” it notes, “it is far from clear there is a digital news business model to sustain these outlets.”
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