SILVER LINING? Coronavirus Economic Fallout Expected to Destroy Hundreds of Main Stream Newspapers, Magazines
The coronavirus pandemic is expected to cause massive economic damage throughout many sectors, and what remains of the legacy journalism industry may be wiped out as a result.
The Seattle Times serves as a microcosm for what is happening to local papers throughout America in the age of coronavirus. As they deal with a community ravaged by the pandemic, their advertising budget has completely dried up, and they may not be able to remain in business for much longer.
“Virtually all entertainment advertising is gone, restaurants gone. Automobile advertising is starting to get impacted,” said Alan Fisco, the president and CFO of the paper, to BuzzFeed News.
Even though the paper’s “online traffic has been at times off the charts,” they are unable to properly monetize that traffic. They fear that the ad revenue may be lost forever by the time the coronavirus pandemic comes to a close.
“If you go back to events in the past where you’ve seen some big impacts [to ad spending], does all of it come back? It hasn’t,” Fisco said.
Ken Doctor, who analyzes the news industry with the firm Newsonomics, believes that the economic impact caused by the coronavirus pandemic will be much worse for the media industry than the 2008 financial crisis, which resulted in a 19 percent decline in revenue for newspapers.
“[Newspaper] advertising revenue is getting just wiped out,” Doctor said to BuzzFeed News, adding that the situation is already “worse than in 2008 and 2009.”
For many media entities, Doctor believes that this will be the end. He said that “this seems like for them truly it is the full extinction event. I don’t know how they come back.”
The Seattle Times may be able to survive due to rising subscriber fees. Other big-name dailies – like the Wall Street Journal, New York Times, and Washington Post – are expected to weather the storm as well. However, all of the smaller local newspapers and digital providers will likely be wiped out completely.
“I think there we will unfortunately see more closures of newspapers, more news deserts as a result of this,” Fisco said.
Media companies and reporters are already reporting on the early damage that has been caused because of the coronavirus pandemic.
In response to the effects of the coronavirus pandemic that has taken a heavy toll on the residents and businesses of metro Detroit, C & G Newspapers has temporarily suspended publication of its 19 print newspapers, starting with the March 25 issues. pic.twitter.com/89wilmoQLn
— C & G Newspapers (@candgnews) March 21, 2020
— DigBoston (@DigBoston) March 16, 2020
The phrase being thrown around in an alt-media group on FB. If you don’t support your local newspapers NOW, whether you engage with print or not, you WILL lose an extremely dedicated lifeline to arts, music, culture and unbiased news in your community. pic.twitter.com/T0RMZFOLnA
— Justin LaFrancois (@lafrancois_j) March 19, 2020
Rough day at @RiverfrontTimes. Myself and multiple staffers "furloughed." No notice from management in previous days; simply the lovely wake-up notice that I had been booted as FB admin and couldn't log in to email. Love ya'll. Love this staff and the work we do. Sigh.
— Danny Wicentowski (@D_Towski) March 18, 2020
Scene today laid off five staff members due to the severe economic fallout of the coronavirus pandemic https://t.co/QpsD2H6ZuJ
— Cleveland Scene (@ClevelandScene) March 18, 2020
A spokesperson for BuzzFeed News, who published the initial story about how the media industry is hurting because of coronavirus, said their provider is working to avoid firing staffers in these trying times.
“BuzzFeed’s leadership team is exploring a range of ways to support employees while protecting our business,” said Chief Communications Officer Carole Robinson. “Our goal is to avoid layoffs, with an alternative plan that requires some sacrifice from all of us — and especially those on the executive team — ultimately allowing us to remain a strong company over the long-term.”
The coronavirus pandemic is a worst case scenario come to life, but the economic fallout from the crisis may prove to be fatal for the fake news industry.