Last year could be called the year of consolidation as technology’s disruption of the media industry continued across print and digital publishers alike. Companies continued shifting their gaze to video, live events, branded content and e-commerce in order to grow new streams of revenue.
Meanwhile, publishers tried to gain footing as advertising in print continuously shrank.
“The print drop has been astounding in the third quarter,” said media analyst Ken Doctor. “The fourth quarter, I hear isn’t a whole lot better…much of the print world is anticipating a 10 percent drop in print advertising in 2017. So if you connect the dots of print continuing to nosedive, there will be more buyouts and more layoffs” in the coming year.
That process already started in 2016, as Time Inc., Hearst, Condé Nast and Meredith Corp. endured layoffs, structural reorganization, circulation reduction and, in some cases, shuttered magazines. Meredith closed More magazine at the beginning of the year, and Condé Nast ended its year by folding Self. Meanwhile, Time Inc. rejiggered its c-suite under new chief executive officer Rich Battista by reconfiguring its business side with publishers selling across categories, such as beauty and autos, instead of for a particular magazine. The company’s renovation comes at a time when there’s buzz it may be up for sale — a storyline that will be one to watch in 2017.
Condé Nast, which will unveil a new corporate structure in the new year, reduced the frequency of Teen Vogue to a quarterly, and said it would consolidate creative directors, copy teams and researchers across its stable of titles. Hearst followed suit, in a way, lowering the frequency of its teen glossy Seventeen to six times a year and quietly consolidating editors of Cosmopolitan, Redbook, Good Housekeeping and Woman’s Day under the lifestyle group. More job consolidations are said to be on the way at all the magazine publishers, as many in the industry wonder if the publishers are cutting too much, and forfeiting the quality of their print products to evolve their digital businesses. Other magazine closures last year included Complex, Bloomberg Pursuits, Mental Floss, Fitness Magazine and a group of travel magazines at Bonnier.
Buyouts were doled out at The New York Times and The Wall Street Journal, as both publishers reallocated their resources, placing less of an emphasis on lifestyle coverage and more on audience development, emerging technologies, such as virtual reality and, in the case of The Journal, financial coverage.
But it was also survival of the fittest in the digital world. Mode Media, which was once valued at $1 billion, shuttered in September, sounding alarm bells that perhaps those sky-high valuations were overblown. In order to cultivate his brands, Group Nine chief executive officer Ben Lerer inked a $100 million deal with Discovery Communications this year.
“I think there’s going to be a meaningful consolidation in the media space,” Lerer told WWD, citing similar “roll-ups” in media such as Univision’s buying spree of Gawker Media, The Onion, The Root and the remaining stake of Fusion, or Hearst and Verizon’s acquisition of Complex Media, among others.
Weighed down by hefty costs, Univision cut about 250 jobs, with the majority coming from Fusion, which had been a money-losing venture since it launched in 2013. With its eye on going public, Univision will need to integrate Gizmodo Group, the former Gawker properties, according to Doctor, who cited affiliate commerce opportunities.
Aside from native advertising, which is expected to become a $59 billion global industry by 2018, according to data firm Adyoulike, media companies have begun looking at commerce again. Towards the end of 2016, The New York Times made a big push into commerce when the company snapped up Wirecutter and The Sweethome, and New York Magazine launched The Strategist for product recommendations. In 2017, the trend is widely expected to continue and expand — after all, media cannot live by ads alone.
Meanwhile, the role of the third-party platform came under fire as these new media companies facilitated the dissemination of fake news, which emerged as a key topic in the presidential election and the dawn of the “post-truth” era. The danger of permitting the Facebooks, Googles and Twitters of this world to be a touch point for news — both fake and real — without regulation was, arguably, the biggest media story in 2016 — and will continue to be an issue in 2017.
Once the purview of supermarket tabloids, fraudulent, sensationalized stories are more believable in an environment where readers are less likely to differentiate news sources and were given greater reach thanks to social media algorithms that prize engagement over content. But, during the election, Facebook was a petri dish for fake stories by sites that positioned themselves as real news organizations. After a continuing outcry, the firm announced some stopgaps that would at least alert users when they share stories that are demonstrably untrue.
But as with so many terms, “fake news” has become a catchall employed by the left and the right on the political spectrum to slam stories that they felt were biased or contained errors. In 2017, the term will continue to be a way to call out unfavorable coverage and is likely to gain even more currency as a rhetorical staple of the politically divided country.