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Online – Intro

Introduction

By the Project for Excellence in Journalism

We may well look back at 2008 as milestone in the history of the Web as a news destination.

By various measures, the number of people who began to rely on the Web as a regular or even their main news source appeared to jump.  For national and international news, according to survey data, the Web surpassed all other media except for television as a destination.

Some of the gains came from new news operations popping up, often subject-specific sites offering deep and rich content. Some came from mainstream news outlets enhancing their own content. Mainstream news sites still get the lion ’s share of online audience and enjoyed major gains. And some of the growth is a matter of expanding access to broadband and people becoming more accustomed to the Web’s advantages in convenience, speed and depth.

But the rise in the Web ’s news audience in 2008, even at legacy news sites, only added to the crisis in facing journalism.

For it also became patently clear during the year that the economic model largely responsible for financing journalism in the old media, advertising, will not do so in the new. Online advertising over all began to slow down, and display advertising in particular, the primary ad-revenue source for news, appeared to actually decline. The internals of the data look even bleaker still.

By all appearances, the limited prospects for online advertising that supports news in 2008 became a settled issue. Even worse, little progress appeared to be made during the year in developing any new revenue models, the biggest challenge the news industry faces in its fight for survival.

Instead, the industry seemed preoccupied, even early in the year, with simply trying to cope with declining revenue in its legacy platforms. Many companies simply cut costs at levels equal to their declining revenues. By fall, the deteriorating economy turned that structural crisis into something close to a terrifying free fall.

The combination of rising Internet audiences and the steep recession appears to be shortening the time line that the traditional news industry now has to sort out its problems.

The challenge for the old media was to use their legacy revenue to figure out how to financially reinvent themselves on the Web.

Now, as that already-declining revenue dries up even faster with the recession, and the migration to the Web among audiences accelerates, the time left to sort out a new revenue model seems to be shrinking.

Among new alternative news outlets, the economic model looks no more promising. For all the experiments with new ways of reporting, producing, disseminating and sharing news content, most of the money to support them has come either from philanthropy or private individuals. There has been little honest assessment of economic sustainability.