2009 is going to be a brutal year for the media industry. Barring some miracle, the Seattle Post-Intelligencer won't be the only casualty.
Doug McIntyre at 24/7 Wall St surveys the landscape:
No one working in the media industry will ever have seen a year as bad as 2009 will be...The most endangered of the media sectors is the newspaper industry. The Seattle Post-Intelligencer and Denver's Rocky Mountain News have already been slated for closing if they do not find buyers. They won't. The Miami Herald is on the block. Due to the remarkably poor real estate environment in South Florida, this property is unlikely to find a new home. National newspaper chains Journal Register and Gatehouse have been delisted from the NYSE and are likely to try to auction off their operations. McClatchy (MNI), the third largest chain in the country, will struggle to make its debt service. Scores of papers, large and small, will fold this year. Newspaper expert Alan Mutter recently wrote that any paper in a major city with two dailies is in tremendous trouble.
The magazine industry is not in much better shape although its very sharp downturn did not begin until last year. Conde Nast recently closed Men's Vogue and cut back the frequency and online operations of Portfolio. Media giant Meredith recently closed Country Home. Two months ago, PC Magazine said it would close its print edition and operate only online. According to MIN, at least a dozen major magazines had ad page decreases of more than 20% last year including US News & World Report, Rolling Stone, Boating, Gourmet, Ladies Home Journal, More, and Smart Money. A number of these magazines also had sharp page drops in their January editions. With advertising expenditures likely to fall throughout the year, it is hard to imagine how many men's magazines, car publications, food, and shelter magazines will be able to stay afloat in segments of the industry which are already crowded.
A year ago, most analysts expected that the online marketing business would be largely recession-proof. It is now clear that this is not true. Gawker owner Nick Denton expects online ad revenue to drop by double digits. Even if that does not turn out to be true, web properties which are losing money now won't all make it to the end of 2009. Denton has already closed ValleyWag. Retail website eLuxury.com is closing. 8020 Media, started by CNET founder Halsey Minor, has been shuttered...
Here's Doug's list of the doomed (read the full article here):
The Miami Herald.
Minneapolis Star-Tribune will file for Chapter 11 early this year...
The New York Daily News operates in the most competitive newspaper market in the US and it is not clear that any of the properties in this fight makes a dime...
The San Francisco Chronicle is owned by the privately-held Hearst Corporation which has said it will sell or close its paper in Seattle within the next 60 days. Media experts say that the Chronicle has lost money for several years. The faltering California economy will only make this worse...
Playboy has lost advertising pages each of the last four years, falling from 685 pages in 2004 to 463 pages last year....
Entertainment Weekly made only $10 million last year according to The New York Post. That number has decreased rapidly. Last year the magazine lost 20% of its advertising pages compared with the year before...
Smart Money's ad pages fell 30% last year to 503 compared with the year before. In 2004, the figure was 784 pages. The January 2009 issues were down another 24%. This magazine will close...
Gourmet will probably not see the end of the year....From 2004 to 2008, Gourmet’s ad pages have dropped from 1,364 to 955, with a 24% drop last year. January’s ad pages were down another 32% according to MIN. Gourmet can survive since it has a competitive audience of web visitors to its food site, but it will have to migrate totally to its website...
Answers.com is a very large web property that many people haven't heard of. According to comScore, the answers.com websites had almost 25 million unique visitors in October, making it No. 34 among the top 50 websites in the US. But, the company makes little if any money on all of that traffic. In the third quarter, Answers Corp, which is a public company, had revenue of only $3.6 million and an operating loss of $112,000. That is a astonishingly low revenue-yield-per-visitor. Most of the firm's revenue comes from online advertising...
Eons.com is a social network and information website for baby boomers. Unfortunately, it is not growing the way most social networks are. Quantcast shows its audience is currently well below where it was in the late summer of last year...
PlanetOut's market cap is down to $2 million. Last week the company was sold to Here Media. The deal is too late to save the website. Compete.com shows that its audience has declined 25% over the last year to a fairly small 61,000 unique visitors. That is not enough traffic to keep a media and ecommerce site alive...
