Six major trends of the year of 2012:

The effects of a decade of newsroom cutbacks are real – and the public is taking notice. Nearly a third of U.S. adults, 31%, have stopped turning to a news outlet because it no longer provided them with the news they were accustomed to getting. Men have left at somewhat higher rates than women, as have the more highly educated and higher-income earners—many of those, in other words, that past Pew Research data have shown to be among the heavier news consumers. With reporting resources cut to the bone and fewer specialized beats, journalists’ level of expertise in any one area and the ability to go deep into a story are compromised.  Indeed, when people who had heard something about the financial struggles were asked which effect they noticed more, stories that were less complete or fewer stories over all, 48% named less complete stories while 31% mostly noticed fewer stories. Overall, awareness of the industry’s financial struggles is limited. Only 39% have heard a lot or some. But those with greater awareness are also more likely to be the ones who have abandoned a news outlet.

The news industry continues to lose out on the bulk of new digital advertising. Two new areas of digital advertising that seemed to bring promise even a year ago now appear to be moving outside the reach of news: mobile devices and local digital advertising. Over all, mobile advertising grew 80% in 2012 to $2.6 billion. Of that, however, only one ad segment is available to news: display. While mobile display is growing rapidly, 72% of that market goes to just six companies—including Facebook, which didn’t even create its first mobile ad product until mid-2012. Local digital advertising, a critical ad segment for news as the majority of outlets cater to a local audience, is also growing—22% in 2012. But improved geo-targeting is allowing many national advertisers to turn to Google, Facebook and other large networks to buy ads that once might have gone to local media. In addition, Google and Facebook are also improving their ability to sell ad space to smaller, truly local, advertisers, again taking business that once went to local media. It is hard to see how news organizations will secure anything like their traditional share.  Google is now the ad leader in search, display and mobile.  Once again, in key revenue areas, it appears the news industry may have been outflanked by technology giants.

http://stateofthemedia.org/2013/overview-5/

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In many ways, 2013 and early 2014 brought a level of energy to the news industry not seen for a long time. Even as challenges of the past several years continue and new ones emerge, the activities this year have created a new sense of optimism – or perhaps hope – for the future of American journalism.

Digital players have exploded onto the news scene, bringing technological knowhow and new money and luring top talent. BuzzFeed, once scoffed at for content viewed as “click bait,” now has a news staff of 170, including top names like Pulitzer Prize-winner Mark Schoofs, and is the kind of place that ProPublica’s Paul Steiger says he would want to work at if he were young again. Mashable now has a news staff of 70 and enticed former New York Times assistant managing editor Jim Roberts to become its chief content officer. And in January of this year, Ezra Klein left the Washington Post for Vox media, which will become the new home for his explanatory journalism concept. Many of these companies are already successful digital brands – built around an innate understanding of technology – and are using revenues from other parts of the operation to get the news operations off the ground.

Other kinds of new revenue are flowing into news operations as well. A new breed of entrepreneurs – like Jeff Bezos, John Henry and Pierre Omidyar — are investing their own money in the industry, in some cases creating wholly new entities and in others looking to bring new life to long-standing ones.

The year also brought more evidence than ever that news is a part of the explosion of social media and mobile devices, and in a way that could offer opportunity to reach more people with news than ever before. Half of Facebook users get news there even though they did not go there looking for it. And the Facebook users who get news at the highest rates are 18-to-29-year-olds. The same is true for the growth area of online video. Half of those who watch some kind of online video watch news videos. Again, young people constitute the greatest portion of these viewers.

Accompanying this momentum is the question of what it adds up to within the full scope of news that consumers receive. Here the events of the last year get put in some perspective. Our first-ever accounting found roughly 5,000 full-time professional jobs at nearly 500 digital news outlets, most of which were created in the past half dozen years. But the vast majority of bodies producing original reporting still comes from the newspaper industry. But those newspaper jobs are far from secure. Full-time professional newsroom employment declined another 6.4% in 2012 with more losses expected for 2013. Gannett alone is estimated to have cut 400 newspaper jobs while the Tribune Co.  announced 700 (not all of them in the newsroom).ScreenHunter_648 Jul. 04 17.32.jpg

The new money from philanthropists, venture capitalists and other individuals and non-media businesses, while promising, amounts to only a sliver of the money supporting professional journalism. Traditional advertising from print and television still accounts for more than half of the total revenue supporting news, even though print ad revenues are in rapid decline. While seeing some small gains in new revenue streams like digital subscriptions and conferences, total newspaper advertising revenue in 2013 was down 49% from 2003.

Television ad revenue, while stable for now, faces an uncertain future as video becomes more accessible online. What’s more, most of the new revenue streams driving the momentum are not earned from the news product itself.

At this point, fully a quarter of the 952 U.S. television stations that air newscasts do not produce their news programs. Additional stations have sharing arrangements where much of their content is produced outside their own newsroom.     

In digital news, the overlap between public relations and news noted in last year’s State of the News Media report became even more pronounced. One of the greatest areas of revenue experimentation now involves website content that is paid for by commercial advertisers – but often written by journalists on staff – and placed on a news publishers’ page in a way that sometimes makes it indistinguishable from a news story. Following the lead of early adapters like The Atlantic and Mashable, native advertising, as it is called by the industry, caught on rapidly in 2013. The New York Times, The Washington Post and most recently The Wall Street Journal have now begun or announced plans to begin devoting staff to this kind of advertising, often as a part of a new “custom content division.”eMarketer predicts that native ads spending will reach $2.85 billion by 2014.ScreenHunter_651 Jul. 05 06.22.jpg

Many of these publishers initially expressed caution over such ads, with Wall Street Journal editor-in-chief Gerard Baker even describing it as a “Faustian pact.” In the end, though, many publishers eventually came down with a conclusion similar to Baker’s, who said that he was  “confident that our readers will appreciate what is sponsor-generated content and what is content from our global staff,” according to a statement released by The Journal. That may be the case, and it could also be the case that stories created for and paid for by advertisers do not bother consumers as long as they are a good read. At this point, though, there is little if any public data that speak to consumer response one way or the other.

And despite evidence of news consumption by Facebook users—half of whom report getting news across at least six topic areas—recent Pew Research data finds these consumers to have rather low levels of engagement with news sites.

A year ago, the State of the News Media report struck a somber note, citing evidence of continued declines in the mainstream media that were impacting both content and audience satisfaction. As indicated above and throughout this report, many of these issues still exist, some have deepened and new ones have emerged.

From these reports, six major trends emerge:

1) Thirty of the largest digital-only news organizations account for about 3,000 jobs and one area of investment is global coverage.  Vice Media has 35 overseas bureaus; The Huffington Post hopes to grow to 15 countries from 11 this year; BuzzFeed hired a foreign editor to oversee its expansion into places like Mumbai, Mexico City, Berlin and Tokyo. The two-year-old business-oriented Quartz has reporters in London, Bangkok and Hong Kong, and its editorial staff speaks 19 languages. This comes amid pullbacks in global coverage from mainstream media. The amount of airtime network evening newscasts devoted to overseas reporting in 2013 was less than half of what it was in the late 1980s. International reporters working for U.S. newspaper have declined 24% from 2003 to 2010. As the new digital native outlets continue to add staff, the country may be seeing the first real build-up of international reporting in decades – save for a few start- ups like Global Post.

2) So far, the impact of new money flowing into the industry may be more about fostering new ways of reporting and reaching audience than about building a new, sustainable revenue structure.  The news industry in the U.S. brings in a little over $60 billion of revenue annually, according to estimates in our report. Advertising, at least for now, accounts for roughly two-thirds of this pie, most of which remains tied to legacy forms. Audience revenue accounts for about a quarter and is growing both in total dollars and in share. But this revenue may also be coming from a smaller—or at least flat—pool of contributors. New kinds of earned revenue streams like event hosting and web consulting account for about 7%, while investment from sources such as venture capital and philanthropy amount to only about 1% of the total.  One part of the equation worth exploring is what kind of savings occurs at digital news startups free of the legacy infrastructure, but taking on the newer costs of technology development and maintenance.

3) Social and mobile developments are doing more than bringing consumers into the process – they are also changing the dynamics of the process itself. New survey data released here find that half (50%) of social network users share or repost news stories, images or videos while nearly as many (46%) discuss news issues or events on social network sites. And with broader mobile adoption, citizens are playing important eyewitness roles around news events such as the Boston bombing and the Ukrainian uprising. Roughly one-in-ten social network users have posted news videos they took themselves, according to the data.  And 11% of all online news consumers have submitted their own content (including videos, photos, articles or opinion pieces) to news websites or blogs. Just as powerful, though, are the shifts in how news functions in these spaces.  On social sites and even many of the new digital-only sites, news is mixed in with all other kinds of content – people bump into it when they are there doing other things. This bumping into means there may be opportunity for news to reach people who might otherwise have missed it, but less of that may be in the hands of news organizations. Only about a third of people who get news on Facebook follow a news organization or individual journalist. Instead, stories get shared from friends in their networks. And few Facebook visitors, according to a separate Pew Research study of traffic to top news sites, end up also coming to a site directly.  For news providers, this means that a single digital strategy – both in terms of capturing audience and building a viable revenue base – will not be enough.

4) New ways of storytelling bring both promise and challenge. One area of expansion in 2013 was online news video. Ad revenue tied to digital videos over all (no firm calculates a figure specifically for news videos) grew 44% from 2012 to 2013 and is expected to continue to increase. For now, though, its scale is still small, accounting for just 10% of all digital ad revenue in the U.S. YouTube alone already accounts for 20% of these revenues and Facebook has now entered the digital video ad market and, based on its rapid growth in display ad revenue, is expected to quickly account for a significant portion of these dollars. In terms of audience appeal, one-third of U.S. adults watch online news videos, but that growth has slowed considerably. After a 27% increase from 2007 to 2009, the next four years saw just 9% growth. Again, large distributors of video content like YouTube and Facebook already account for a hefty portion of video watching on the web.  Nonetheless, some news providers are making significant investments in digital video. The Huffington Post celebrated the one year anniversary of HuffPost Live, Texas Tribune held a successful Kickstarter campaign to raise funds for the purchase of equipment to stream live video coverage of the 2014 Texas governor’s race, and the multimedia company Vice in early 2014 launched a new multimedia portal just for news stories.

5) Local television, which reaches about nine in ten U.S. adults, experienced massive change in 2013, change that stayed under the radar of most. Nearly 300 full-power local TV stations changed hands in 2013 at a price of more than $8 billion. The number of stations sold was up 205% over 2012 and the value up 367%, with big owners getting even bigger. If all the pending sales go through, Sinclair Broadcasting alone will own or provide service to 167 stations in 77 markets, reaching almost 40% of the U.S. population. Sinclair’s CEO, David Smith, at the UBS conference in December 2013 expressed an interest in growing even more: “I’d like to have 80% of the country if I could get it. I’d like to have 90%.” Much of what is driving these purchases is the growth in fees that local stations are able to charge cable companies for re-airing their content – known by the industry as retransmissions fees. Both Meredith (which owns 13 stations) and Scripps (which owns 19) said they saw their retransmission revenues roughly triple in the last three years.  In terms of programming, a clear result is more stations in the same market being operated jointly and sharing more content. As of early 2014, joint service agreements exist in almost half of the 210 local TV markets nationwide, up from 55 in 2011. And fewer stations are producing their own newscasts. The ultimate impact on the consumer is complicated to assess, but the economics benefit to the owner is indisputable.

6) Dramatic changes under way in the makeup of the American population will undoubtedly have an impact on news in the U.S, and in one of the fastest growing demographic groups – Hispanics – we are already seeing shifts. The Hispanic population in the U.S. has grown 50% from 2000 to 2012–to 53 million people. Most of that growth has come from births in the U.S. rather than the arrival of new immigrants, reversing a trend from previous decades. As a result, a growing share of the Hispanic population is American-born and a growing number speak English proficiently.  In response to these trends, more general-market media companies—like ABC, NBC, Fox and The Huffington Post—have started Hispanic news operations. Since 2010, six national Hispanic outlets have been launched, all of which are either owned in full or in partnership by a general-market media company. Not all of them have been successes, however.  Earlier this year, NBC Latino—a website-only outlet—closed, after only 16 months, and CNN Latino, which had both a web and on-air presence, was shut down just a year after its launch. At the same time, Fusion, a joint effort by ABC and Univision, initially described the channel as aimed at Hispanic millennials but later switched to aiming it at millennials more broadly—currently the largest and most diverse generational group in the U.S. As demographic shifts within the U.S. continue, so too will their impact on the news ecosystem.

# http://www.journalism.org/2014/03/26/state-of-the-news-media-2014-overview/

From 2013 reports, these major trends emerge:

The effects of a decade of newsroom cutbacks are real – and the public is taking notice. Nearly a third of U.S. adults, 31%, have stopped turning to a news outlet because it no longer provided them with the news they were accustomed to getting. Men have left at somewhat higher rates than women, as have the more highly educated and higher-income earners—many of those, in other words, that past Pew Research data have shown to be among the heavier news consumers. With reporting resources cut to the bone and fewer specialized beats, journalists’ level of expertise in any one area and the ability to go deep into a story are compromised.  Indeed, when people who had heard something about the financial struggles were asked which effect they noticed more, stories that were less complete or fewer stories over all, 48% named less complete stories while 31% mostly noticed fewer stories.

The news industry continues to lose out on the bulk of new digital advertising. Two new areas of digital advertising that seemed to bring promise even a year ago now appear to be moving outside the reach of news: mobile devices and local digital advertising. Overall, mobile advertising grew 80% in 2012 to $2.6 billion. Of that, however, only one ad segment is available to news: display. While mobile display is growing rapidly, 72% of that market goes to just six companies—including Facebook, which didn’t even create its first mobile ad product until mid-2012. Local digital advertising, a critical ad segment for news as the majority of outlets cater to a local audience, is also growing—22% in 2012. But improved geo-targeting is allowing many national advertisers to turn to Google, Facebook and other large networks to buy ads that once might have gone to local media. In addition, Google and Facebook are also improving their ability to sell ad space to smaller, truly local, advertisers, again taking business that once went to local media. It is hard to see how news organizations will secure anything like their traditional share.  Google is now the ad leader in search, display and mobile.  Once again, in key revenue areas, it appears the news industry may have been outflanked by technology giants.

The long-dormant sponsorship ad category is seeing sharp growth. This is one area of growing digital ad revenue where news organizations have taken early steps to move in. Promoted tweets on Twitter account for some of the growth, along with the rise of native ads—the digital term for advertorials containing advertiser-produced stories—which often run alongside a site’s own editorial content. Though it remains small in dollars, the category’s growth rate is second only to that of video. Sponsorship ads rose 38.9%, to $1.56 billion; that followed a jump of 56.1% in 2011. Traditional publications such as The Atlantic and Forbes, as well as digital publications BuzzFeed and Gawker, have relied on native ads to quickly build digital ad revenues, and their use is expected to spread. According to tech website PandoDaily, major publishers including Hearst, Time and Condé Nast are investing in formats to run native ads, as are many newspapers. The development, however, runs the risk of confusing readers about the difference between advertising and news content.

The growth of paid digital content experiments may have a significant impact on both news revenue and content. After years of an almost theological debate about whether digital content should be free, the newspaper industry may have reached a tipping point in 2012. Indeed, 450 of the nation’s 1,380 dailies have started or announced plans for some kind of paid content subscription or pay wall plan, in many cases opting for the metered model that allows a certain number of free visits before requiring users to pay. (The trend has also spread beyond newspapers, as highlighted by popular blogger Andrew Sullivan’s recent decision to attach a fee to his site, The Dish.) With digital ad revenue growing at an anemic 3% a year in the newspaper industry, digital subscriptions are seen as an increasingly vital component of any new business model for journalism—though, in most cases, they fall far short of actually replacing the revenue lost in advertising. Thanks in good part to its two-year-old digital subscription program, The New York Times reports that its circulation revenue now exceeds its advertising revenue, a sea change from the traditional revenue split of as much as 80% advertising dollars to 20% circulation dollars. Going forward, many news executives believe that a new business model will emerge in which the mix between advertising and circulation revenue will be close to equal, most likely with a third leg of new revenues that are not tied directly to the news product. The rise of digital paid content could also have a positive impact on the quality of journalism as news organizations strive to produce unique and high-quality content that the public believes is worth paying for.

While the first and hardest-hit industry, newspapers, remains in the spotlight, local TV finds itself newly vulnerable.  Local TV audiences were down across every key time slot and across all networks in 2012. While local TV remains a top news source for Americans, the percentage is dropping—and dropping sharply among younger generations.  Regular local TV viewership among adults under 30 fell from 42% in 2006 to just 28% in 2012, according to Pew Research survey data.   What’s more, the topics people go there for most—weather and breaking news (and to a lesser extent traffic)—are ripe for replacement by any number of web- and mobile-based outlets.  Advertising revenues were up for the year, but that was largely due to a windfall of $2.9 billion in political advertising revenue, something that cannot be replicated in non-election years. Overall, average revenue for news-producing stations declined by more than a third (36%) from 2006 to 2011.

Hearing about things in the news from friends and family, whether via social media or actual word of mouth, leads to deeper news consumption. A majority of Americans seek out a full news story after hearing about an event or issue from friends and family, a new Pew Research survey released here finds. For nearly three-quarters of adults (72%), the most common way to get news from friends and family is by having someone talk to them—either in person or over the phone. And among that group, close to two-thirds (63%) somewhat or very often seek out a news story about that event or issue. Social networking is now a part of this process as well: 15% of U.S. adults get most of their news from friends and family this way, and the vast majority of them (77%) follow links to full news stories. Among 18-to-29 year-olds, the percentage that primarily relies on social media for this kind of news already reaches nearly one-quarter.

http://stateofthemedia.org/2013/overview-5/