Inaudible? Audacy, one of the country’s largest radio companies, files for bankruptcy. Return to sender? Jimmy Finkelstein’s The Messenger is reportedly “broke” and possibly being purchased after failing to make a profit. Untweet? Elon Musk’s X losing $75 million in advertising revenue in 2023. All three outlets may soon be joining the media graveyard, which seems to be ever-growing.
According to a Northwestern University study, 2023 saw on average 2.5 local newspapers closed each week. The same study found over the last 15 years news ‘deserts’ are growing across the nation. There are three common denominators in all of these situations: lack of funding, not enough resources, and too much competition.
With the exception of X all of these outlets; Audacy, The Messenger, and local newspapers, don’t have the greatest funding. Audacy, who officially filed for bankruptcy on Monday, is looking to eliminate $1.6 billion in debt. According to Axios, Finkelstein’s startup is looking to raise $20 million after laying off some staffers. As for local newspapers, Northwestern University reported philanthropists will give $500 million to support local news outlets over the next 5 years. This sounds good until you do the math.
If 6,000 local newspapers across the country are to equally split $100 Million in 2024, each outlet will receive less than $17,000 annually. On average starting salaries are $37,600, according to The Radio Television Digital News Association. The only states that would be able to hire a full-time employee with this extra cash would be Georgia and Wyoming whose minimum wage is $7.25. This lack of funding funnels into the media’s next problem, not enough resources.
Even well-funded and widely read outlets like The Washington Post, NPR, and Condé Nast, carried out layoffs in 2023. With newsrooms shrinking, it’s becoming more difficult to be a journalist, meaning working your beat, cultivating sources, and working on hard-hitting investigative stories.
An April 2023 study by The Hussman School of Journalism found 70% of local journalists experienced work-related burnout. The same study found 72% of those polled considered leaving their current job in journalism. Many do leave journalism for jobs in PR or Marketing. Why? Better pay, better working hours, and allegedly less work. A quick Google search will bring you hundreds of “why I left the media” articles and blog posts.
While these two things create a vicious cycle the question remains, where does ad revenue actually go? Statesta predicted 2023 would bring $352 Billion in ad revenue, $189 Billion of which comes from digital. They also predict ad revenue will hit $1 Trillion by 2027. News outlets are not just competing with each other for a slice of the revenue pie, they are also competing with clickbait sites like Buzzfeed and Upworthy.
Additionally, they are competing with Facebook, Google, and X, plus all other social media outlets and search engines (which is why Canada and Australia passed legislation requiring Facebook and Google to pay media outlets but I wrote that column already and the problems with the idea.) Keep in mind, before Al Gore unleashed the Internet unto the world there was competition but not to this level.
Many outlets will likely continue to close due to mergers or bankruptcies because hard news is not profitable. Don’t get me wrong yes news outlets do make profits Fox News made almost $2 Billion in 2022, CNN under $1 Billion, MSNBC under $500 Million, and Newsmax just scratches the surface with $37 Million in profits for 2022. Fox and CNN have 3 things that make them billions. First, They are more centered than MSNBC or Newsmax. Second, they are incredibly good at self-promoting, (especially Fox they make very good use of all their resources). Third, and most importantly, they have more ‘magazine style’ news available than MSNBC and Newsmax.
Magazine-style news, which was brought to life by Don Hewitt, began in 1968 with 60 Minutes. The program was the first of its kind, turned a nice profit for CBS and took what was considered a bad time slot to one of the greatest of all time. FOX and CNN both have long-form programming with Fox Nation and CNN Original Series. Programing like this often subsidies newsroom spending allowing journalists to work their beat and cultivate sources.
Something else happened in the 60’s which brings us the news we have today, News and Entertainment began to collide. What would have been a bland ‘Murder in restaurant’ headline in 1961 was replaced with more saucy, borderline tabloid headline like ’Headless Body in Topless Bar’ by 1983. 2023 saw headlines like ‘UnTucked’ instead of ‘Tucker Carlson leaves Fox News.’
Audacy, The Messenger, and X are all competing for a piece of the same revenue pie. One which FOX and CNN have a pretty good hold on. Getting a piece of the ad revenue pie is way more difficult than it used to be. To survive, you have to provide entertainment (which can sometimes be viewed as biased) and provide some form of magazine-style news. Or you can go the easy way like Buzzfeed and create clickbait, however, you likely lose a little credibility in the process.
Krystina Alarcon Carroll is a news media columnist and features writer for Barrett Media. She has experience in almost every facet of the industry including: digital and print news; live, streamed, and syndicated TV; documentary and film productions. Her prior employers have included NY1 and Fox News Digital and the Law & Crime Network. You can find Krystina on X (formerly twitter) @KrystinaAlaCarr.
