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Key Findings

Key Findings

By the Project for Excellence in Journalism

New patterns in news consumption and a deteriorating economy deepened the emerging cracks in the economic foundation of the media in 2008.

Here is a brief look at the battering year for the news industry as measured by six key indicators: audience, economics, news investment, ownership and digital trends:

Audience

In a big news year, most media continued to see audiences shrink.

Only two platforms clearly grew: the Internet, where the gains seemed more structural, and cable, where they were more event-specific.

The data also suggest a clear trend in the changing nature of how Americans now learn about the world around them. People are relying more heavily — both during peak moments and in general — on platforms that can deliver news when audiences want it rather than at appointed times, a sign of a growing “on demand” news culture. People increasingly want the news they want when they want it.

Audiences Turn to Cable and Web
Percentage Change in Audience, 2007 to 2008, Across Media
Design Your Own Chart
Source: Arbitron, Audit Bureau of Circulations, comScore Media Metrix, Nielsen Media Research1

Economics

The economic storm of 2008 accelerated the crisis facing news business, forcing the weakest into insolvency and testing the strength of the rest. If estimates by Advertising Age prove accurate, total spending on advertising fell for the second consecutive year. Another decline is predicted for 2009. That would mark the first consecutive three-year decline in advertising spending since the Great Depression.For news, some of this—perhaps at least half—cannot be attributed solely to the cyclical downturn. It also reflects the powerful structural shifts brought on by digital technology, which has allowed those who want to reach consumers to do so without the news media as intermediary.

Change in Ad Spending by Medium
2007 to 2008
Design Your Own Chart
Source: Cable: SNL Kagan; Network: TNS Media Intelligence; Online: eMarketer; Local TV: Television Bureau of Advertising; Audio: Radio Advertising Bureau; Magazines: Publishers Information Bureau; Newspapers: Newspaper Association of America.2

News investment

Other than in cable news, the picture in newsrooms in 2008 was brutal, and 2009 could be worse.

Ownership

If things were bad in the counting house and the newsrooms, the picture for the companies that owned the news business was just as grim. There were few buyers out there. And those who had recently bet on the news business—like News Corp., Tribune, and McClatchy — were punished for buying too high or had trouble meeting their debt payments. Stock prices fell, and dividends were slashed. If two years ago there began to be doubts about whether ownership through publicly traded stocks was still an appropriate model, in 2008 bankruptcy restructuring entered the discussion of media ownership in a serious way.

Digital Trends

In addition to the broader audience and economic trends online, a number of specific Web developments emerged in 2008. For the news industry, they bring concern, glimmers of hope and new voices. But much of the expansion and innovation is now coming from those outside of traditional news industries.

And it became clearer during the year that newspapers, television and other legacy media are unlikely to ever support their worldwide news gathering with the sale of banners, pop-ups and other display advertising. The real growth online continues to be in search advertising, and no one has figured out a way yet to combine search advertising with news in sufficient volume.

In online content, citizen news sites that do original reporting gained some steam in 2008, especially in areas where traditional coverage has vanished. But, according to a study of citizen sites in 46 markets, they remain far from a substitute for legacy media. Their range of topics is narrower, the sourcing somewhat thinner and the content often not updated even once a day. They also trail legacy news sites in the various methods for distributing their content.

Presence of Various Distribution Systems
%of sites with each feature
Legacy News
Citizen News
Citizen Blog
RSS Feed
75%
77%
89%
MP3/iPod feed available
28
15
5
Content delivered to cellphone
29
6
2
Able to e-mail stories to a third party
79
30
25

Footnotes

1. The cable figure is based on PEJ’s analysis of Nielsen Media Research data. It represents the combined mean daytime and prime-time viewership (individuals over the age of 2) of CNN, MSNBC and Fox News. The online figure is based on PEJ’s analysis of comScore Media Metrix data. It represents mean unique viewers of the top 50 news websites, excluding weather, entertainment and other specialty sites. (Another leading Internet audience measurement company, Hitwise, calculated a similar audience growth of 23% in its “news and media” category.) The audio figure is based on Arbitron Ratings data. It represents the latest estimate of the average number of people over the age of 12 who listened to news/talk/information on AM/FM radio over the course of a week. The network figure is based on PEJ’s analysis of Nielsen Media Research data. It represents the mean evening news viewership (individuals over the age of 2) of NBC, CBS and ABC. The local TV figure is based on PEJ’s analysis of Nielsen Media Research data. It represents the mean evening news ratings (individuals over the age of 2) for ABC, CBS, Fox and NBC affiliates. The newspaper figure is based on circulation data provided by the Audit Bureau of Circulations. It represents average circulation for the 50 largest U.S. daily newspapers during a six-month period ending September 30 compared to the same period a year prior.  The magazine figure is based PEJ’s analysis of circulation data provided by the Audit Bureau of Circulations. It represents the average circulation during the first half of the year, compared to the same period a year earlier, for eight news magazines studied by PEJ: Time, Newsweek, U.S. News & World Report, The Economist, The Atlantic, The Week, The New Yorker and National Journal.

2. Cable figures are based on estimated combined ad revenues for CNN/Headline News, Fox News and MSNBC for 2007 and 2008, provided by SNL Kagan, a division of SNL Financial LLC. Online figures are total online display ad revenues, from January to September 2008, compared with the same period in 2007, provided by eMarketer. Network figures are based on combined ad revenues for news divisions at ABC, CBS and NBC from January to September 2008, compared with the same period in 2007, provided by TNS Media Intelligence. Local TV figures are based on ad revenue estimates from January to September 2008, compared with the same period in 2007, provided by the Television Bureau of Advertising. Radio figures are based on AM/FM advertising revenues from January to September 2008, compared with the same period in 2007, provided by the Radio Advertising Bureau. Newspapers figures are based on total industry advertising for 2007 and 2008, provided by the Newspaper Association of America. Magazine figures are based on ad pages sold – not revenue – provided by the Publishers Information Bureau for eight news magazines: Time, Newsweek, U.S. News & World Report, The Economist, The Atlantic, The Week, National Journal, and The New Yorker.