The New Yorker’s John Cassidy, who writes about economics and politics, on the current state of the business of journalism:
While many journalists have lost faith in the future of their trade, venture capitalists are taking the opposite view. Far from giving up on journalism, they are providing big chunks of funding to online news providers, such as BuzzFeed, Vice, and Vox. Some of what these publishers put out is mere click bait, but they also produce serious journalism, such as this story, from The Verge, a Vox site, which details how the N.Y.P.D. is using social media to lock up Harlem teens, and this interview that Vice scored with James Mitchell, the psychologist who helped the C.I.A. to develop its “enhanced interrogation”—i.e., torture—techniques.
In addition, online journalism is thriving at many publications that are still widely regarded as “old media.” At the New York Times and other major newspapers, digital subscriptions are rising steadily. To be sure, the revenues from this source haven’t fully replaced all the lost revenues from print subscriptions and print advertising: in some parts of the industry, this may well never happen. But subscription-based journalism (encompassing digital and print) is rapidly becoming financially viable, at least for national publications. And that really is good news. Advertising-funded journalists are beholden to advertisers, page-view metrics, and social-media algorithms. Subscription-funded journalists are beholden to readers.
The rise of online subscriptions isn’t confined to the Times. According to figures from the Alliance for Audited Media, the Wall Street Journal now has more than nine hundred thousand digital subscribers. (Its total circulation is close to 2.3 million.) The Financial Times, which helped to pioneer the metered-paywall model, which allows readers to read a certain number of stories a month before being charged, has gone further in this direction than any other major newspaper. According to Rachel Taube, a spokeswoman for the paper, it now has 476,000 digital subscribers, compared with 217,171 print subscribers. Although it is still known as the Pink ’Un, a reference to the pink paper it is printed on, it is now predominantly a digital publication.
Of course, none of this means that journalism is out of the woods. Regional newspapers, which by definition have smaller markets than national ones, have been hit particularly hard by the decline in print advertising. Magazines, especially small ones, such as The New Republic, also face major challenges, which I’ll discuss in an upcoming post. Throughout the industry, job cuts and efforts to restrict wages and benefits will probably continue. Unless publishers can find a way to expand digital advertising and supplement the money they get from subscriptions, keeping costs in line with revenues will always be a demanding task. That means funding big, time-consuming investigative projects will continue to be a problem. But the argument that newspapers are dinosaurs, destined to be replaced by nimbler online competitors, looks a good deal less convincing than it did a few years ago. And considering where we have been, that qualifies as good news.
Read the whole thing. And subscribe to The WSJ here!