Mainstream Media Closures and Cutbacks Continue
Last Friday both BuzzFeed Oz and Network 10’s news, lifestyle and entertainment website 10Daily ceased operations.
Buzzfeed announced it was closing its Australian operation along with its UK edition on May 13th. The clickbait site will now be a US-based media outlet with all its remaining foreign workers now considered global, rather than local correspondents.
It’s a crashing end to the golden child of web media startups. BuzzFeed was founded by Jonah Peretti in 2006 as a listicle and viral web tracking site, then expanded into news coverage in 2011. Its revenue model was solely based on advertising-support, so as the clicks increased so did its success and it assisted them to fund global expansions.
In the 2010s consumers became the easiest to reach via the social tech giants Facebook and Google. News websites like BuzzFeed became reliant on social media for their site traffic and ad revenue. But when Facebook changed its algorithm to prioritize posts from family and friends rather than pages, sites like BuzzFeed had its revenue rug pulled out from under its business model.
BuzzFeed first began cutting back its global operations at the beginning of 2019. It laid off 15% of its staff worldwide, amounting to 200 employees, 11 of whom were based in its Australian operation.
Its advertising-supported business model wasn’t the only factor in its demise. BuzzFeed, like many other web news startups, adopted a leftist-progressive editorial line which mostly consisted of trashy and sensationalised hit pieces on conservatives and those considered “far-right”.
It is not surprising then that media surveys in the United States and Australia found BuzzFeed to be the least trusted news brand. As its ad revenue dried up BuzzFeed began asking for voluntary donations in 2018. Given the news brand’s untrustworthy reputation it is hardly a surprise that few people were willing to pay for its news and save it from having to undergo cutbacks.
The rise and fall of BuzzFeed, mainly precipitated by its entry into “hard news” and “investigative journalism” was chronologised by popular YouTuber and frequent BuzzFeed critic Hunter Avallone.
The story of BuzzFeed’s Australian demise and global cutbacks is a slower replay of the Huffington Post’s experience. The HuffPost as it is now known launched an Australian edition in 2015 which only lasted until 2017.
Now owned by telecommunications giant Verizon, at the beginning of 2019 Verizon cut 7% of the staff in its media division, which equated to around 800 employees and included staff from HuffPost as well as AOL and Yahoo News.
10 Daily’s Closure
The 10Daily news, entertainment, and lifestyle website was launched in 2018 as part of a Network 10 rebrand after the latter was taken over by the US-based media conglomerate ViacomCBS in the latter half of 2017.
Like all of the other local websites of its ilk, 10Daily adopted a centre-left reporting slant. It hired ex-HuffPost Australia reporter Josh Butler and feminist writer Clementine Ford after her mutual departure from Fairfax Media as a columnist. But last Monday 10Daily staff were told that the outlet would be closed by week’s end and 20 of its editorial staff would be out of a job.
Other News Cuts
It’s not just the new media web ventures who have made cutbacks or suffered losses, so have traditional news media. NewsCorp partially owned by the Murdoch family posted a $1.5 billion loss for the March quarter. Its Australian news channel Sky News is now no longer paying its panel contributors.
The future of the Australian Associated Press (AAP) is still up in the air after it announced closure in early March before the pandemic was declared and lockdown imposed. A consortium led by former News Corp and Foxtel CEO Peter Tonagh has made a bid to save the 85-year-old newswire service which current owners NewsCorp, Nine Entertainment, and Seven West Media are considering.
There is much speculation as to whether these news cutbacks and closures are a response to the economic conditions of the coronavirus and an even further collapse in advertising revenue, or it has simply been used as an opportunity or cover by news executives to undertake the cuts they were already planning to execute.
The Future of the News Business
News reporting and the news business will never die, but with limited demand along with a still-saturated news market and now non-existent barriers to entry, only the very talented, charismatic, and innovative survive.
The revenue model that news outlets can only rely on for profitability is to develop an audience who is loyal and trusts them enough to desire to pay for their product either via subscriptions or donations. Depending upon the outlet it may or may not involve putting up a paywall so that only paid subscribers can access their journalism.
Strong news brands such as The Guardian and Daily Mail that have existed for over a century can adapt and find ways to survive where others can’t. The Guardian has moved to voluntary contributions while the Daily Mail being traditionally a newspaper tabloid is now still holding up as a clickbait tabloid.
In the digital age a trend has been for telecommunications companies, whose viability and profitability is assured, to gobble up traditional media companies.
We already mentioned that Verizon owns the HuffPost and Yahoo News. Comcast owns NBC Universal and Sky UK. AT&T now owns WarnerMedia, HBO, and CNN. While its news divisions will be nowhere near as profitable as their communications products, publishing news gives them a certain degree of political influence which big corporations love.
As the operator of a news outlet that started with a shoestring budget and has survived social media shadow-banning, campaigns of slander and abuse against it, the irony is not lost on me that these once cashed-up mainstream media outlets can no longer find enough consumers and customers to prop up their revenue and buy their content.
The Unshackled currently has a hybrid revenue model operating both from ad revenue and supporter contributions. But as we have ourselves built up a loyal following we are seeing the share of the revenue from our supporter base far outstrip advertising, so we are in a good place and we are grateful to our supporters for this.
The Unshackled was founded because of a gap in the news market for the ordinary Australian who did not want a globalist agenda forced upon them. The mainstream media was unwilling to fill this gap. I doubt given their continued far-left elitist focus they will ever realise how they could have remained relevant to news consumers.