The first signs that an already fragile media industry was starting to buckle under the pressure of a global pandemic appeared at alternative weeklies across the U.S.
From Seattle’s The Stranger to St. Louis’s Riverfront Times, a plethora of alt-weeklies have been forced to lay off staff or suspend print editions as they struggle to tread water amid plunging advertising revenues as their biggest clients — local restaurants, bars, retail and festivals — temporarily shut up shop.
Now the cracks are starting to spread from those to national digital news organizations and magazines, some of which are having to take drastic measures to keep the lights on.
Just last week, BuzzFeed, whose news arm has been without an editor in chief ever since Ben Smith jumped ship to join The New York Times, sent an e-mail to staffers informing them that they would have to swallow a pay cut for at least April and May, with the situation being reviewed on a monthly basis.
The cuts will be graduated, ranging from 5 percent for those earning less than $64,900 and as much as 25 percent for the company’s top earners.
“It is clear that in the short term, the economy will see a steep rise in unemployment, a drop in wages, and perhaps deflation where cash becomes more valuable and assets decline,” founder and chief executive officer Jonah Peretti, who plans to waive his salary during this time, said in a memo to staff.
“It is difficult to forecast in the midst of a crisis, but we are already seeing these dynamics. In our own business we want to save as many jobs as possible, even at the expense of wages declining,” he added. “We don’t know how long this will last but we want to move quickly to make sure our business remains sustainable and we will lift the program and reevaluate if things improve.”
BuzzFeed, like other media organizations, is grappling with the fact that it is witnessing a surge in engagement in COVID-19 stories, at a time when advertising revenues are sliding as companies across the board slash budgets. Adding to these industrywide woes, BuzzFeed News reported Friday that a major brand stopped their ads from appearing on COVID-19 content at major news outlets’ sites in March, acting as a further drag on revenue.
But even before the crisis exploded and large parts of the country effectively shut down, media outlets were feeling the pressure. The New York Times’ ceo Mark Thompson predicted at the beginning of this month that digital advertising revenue would fall 10 percent this quarter amid coronavirus-related “uncertainty and anxiety” among advertisers.
It’s a similar story in the already struggling glossy fashion magazine world, where W Magazine appears to be the first casualty as pull back in the luxury industry proved too much for the title. According to reports, some print staff, who were already working from home, have been furloughed, and the online team is on reduced salaries.
A spokesman for new owner Future Media Group, which acquired W magazine from Condé Nast last summer, confirmed the furloughs, but did not comment further.
The extent of W’s troubles emerged exactly a week after Playboy revealed that it would cease print editions as the economic disruptions from COVID-19 were too much for its already strained print operations to bear, while on Saturday American Media, the already wavering celebrity news and gossip publisher, told staffers know they were getting a considerable reduction in pay.
And worse could come. In addition to a feared advertising slump and slide in newsstand sales, magazines could have trouble filling their pages. For now, the days of huge fashion shoots are gone. True — some shoots are still happening, with only a skeleton staff, but if the government introduces more stringent rules, these could stop altogether. Even sending and receiving outfits for shoots is becoming more difficult to do; as the days go on major fashion houses in Europe and the U.S. are all shuttered with staff working from home, and factories in Italy are also closed.
There will, of course, be shoots in the bank, but if the crisis drags on, they will no doubt start to dry up and some high-fashion lifestyle features could come across as tone deaf as millions of people across the U.S. lose their jobs.
“Right now you can’t go out and do the kind of on-the-scene reporting and photography that you would like to do,” said Dan Kennedy, a journalism professor at Northeastern. “That’s going to be damaging.”
He used the example of local TV news broadcasters to show how what is happening there is reflective of the whole media industry. “Local TV news, like magazines, like anything, is so dependent on the visual element and what we’ve been looking at is reporters coming in by Zoom from their kitchen and B-roll consisting of footage they got months earlier of various things that they’re covering. It just isn’t visually interesting, although obviously they’re doing the best that they can,” he added. “This is going to be the same challenge facing any media outlet that is dependent on visuals and certainly a fashion magazine is more dependent on visuals than most, for sure.”
To date, the big three magazine publishers (Condé, Hearst Magazines and Meredith) have not unveiled any changes to their publishing schedules due to COVID-19. It’s understood, though, that executives at Hearst, which owns Harper’s Bazaar, Marie Claire, Town & Country and Cosmopolitan, have been building COVID-19 contingency plans. It was reported this week that Hearst-owned men’s magazine Esquire had quietly reduced its print frequency issues from eight to six a year, but Hearst insisted this decision was made before the COVID-19 crisis exploded.
Doug Olson, president of Meredith Magazines, publisher of People and InStyle, recently told WWD that while the company has not made any changes to its publishing schedules, it, too, has a contingency plan in place if the situation worsens.
“As a contingency, we went through and said if we have to pull back from a capacity standpoint what would we continue to print or how would we prioritize those things, so we’ve got all those plans in place,” he said. “Obviously, People would sit at the top of the list because it’s a weekly. So we would continue to focus on it and then it really depends on where we are at the close of these different issues what would be next.”
Independent magazines, without a big company behind them, are likely to feel any pain more quickly.
“I think that any independent media outlet that is unable to arrange for the financing that they need to get through the next few months is at risk,” Kennedy added.
There is some assistance, though. Small businesses employing fewer than 1,000 people, including publishers, can apply for $349 billion earmarked for them as part of the $2.2 trillion bailout package approved last week, but only time will tell how much this will help.
In a piece penned for Harvard University’s Nieman Lab, news industry analyst Ken Doctor, looked at whether this Small Business Administration lifeline could make a difference at least for local media.
“Certainly, the size of a local news enterprise determines how far hundreds of thousands of dollars can go. Certainly, though, no one can be sure,” he said. “Barring a major Easter surprise, no one expects this lost ad business to come back big or come back strong. But a million dollars buys one important thing for smaller companies: time.”
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