Are We Dead Yet?
A New Yorker I know recently compared U.S. media companies to a forest of saguaros, the giant cacti that grow in the Sonoran Desert in Arizona. With their fat arms raised to the sky, the saguaros throw grand shadows and can stay alive for hundreds of years. But scientists say these cacti can be dead for five to 10 years, and you wouldn't know it until they fall down.
Like the saguaros, many Web sites, newspapers, and magazines are standing tall these days but dying slowly from within. While symptoms have been noticeable for months, the blight began looking like an epidemic last week, when economists admitted that the U.S. is in a recession. Not only did the gross domestic product shrink during the third quarter, but unemployment also rose sharply, and 400,000 Americans lost their jobs in October alone. In the media sector, an estimated 100,000 media jobs were eliminated in the past year or more, according to IWantMedia.comand many editorial types fear a new wave of layoffs any day now.
Last week, the major dailies were careful to mask the bad economic news, putting unemployment stats on the front page but burying the inevitable conclusion. While The Wall Street Journal was optimistic, one of The Washington Post's stories waited until the fourth graf before quoting an expert who declared us to be "in the throes of a nasty recession." The New York Times avoided the R-word in headlines, and over the weekend, Times writers insisted the recession was "mild" and not yet official.
A few theories to explain this timidity: First, journalists are wary of delivering another scintilla of bad news, what with wacky anthrax and no sign of victory in Afghanistan in sight. Second, since only consumers can save the economy, editors may feel that it's patriotic to withhold news of the recession, in the hopes that an ignorant public will continue to part with its money. Finally, media companies may be in denial about their own financial health and determined to put a good face on an industry whose services are no longer so much in demand.
Space constraints make it impossible to list all the editorial products that have gone out of business of late. Some of the more prominent ones include the political magazine George, which folded in March; Feed, Suck, and The Industry Standard, which fell to earth this past summer; and the doomed troika of Brill's Content, Lingua Franca, and Mademoiselle, which burned down in the wake of the twin towers this fall. In a feat of cosmetic legerdemain, the aptly named Salon has kept its skin fresh while constantly purging from within: 25 people lost their jobs last winter, three slots were shed from the unlaunched radio show this spring, and 14 were sacrificed in August to appease investors.
Layoffs are caused by myriad factors: In 2000, after the dotcom bubble burst, ad sales began to plummet; this year, the costs of printing, mailing, and distribution rose, while media companies' ad revenues and circulation declined. For executives at AOL Time Warner, layoffs were a necessary, if brutal, part of restructuring. No one expected the terrorist attacks, and now the recession feels like a knockout punch.
"I don't want to be the bearer of bad news," says Patrick Phillips, founder of IWantMedia.com, "but it wouldn't surprise me if this is just the way things are going to be for a long time. Media companies are going to be run very lean from now on. It may be more comfortable to ride in a car with four wheels, but if companies can get by on three, that's what they'll do."
"Because of unprecedented growth in the 1990s," concurs magazine analyst Samir Husni, "we forget that for every seven good years, there are seven bad years."
Last January, when the dotcom blues had begun spreading to broadcast and print media, Phillips launched a Web log linking to news reports about layoffs. He includes editorial, business, and support staff in an attempt to be comprehensive, but an exact count is impossible because some layoffs are estimates and others are never announced. The anecdotal evidence is stunning. "Sometimes," says Phillips, "it's just unreal. Every day there's another one."
Herewith a sampling of the magazine companies that announced layoffs this year, according to Phillips's log: Wenner Media (more than 40), Hachette Filipacchi (about 50, not including 39 jobs from George), U.S. News & World Report (58), Playboy (90), and Cahners (about 500). Another 90 people lost their jobs when Condé Nast shut down Mademoiselle, and Primedia sent 38 packing from Brill's Content and Inside.com. Even Brill's editor in chief David Kuhn is gone.
Many newspapers also announced layoffs this year, including: The Wall Street Journal (16), the New York Daily News (36), Newsday (30 to 50), Morning News (73), The Orange County Register (105), The San Jose Mercury News (120), Financial Times (150), The Miami Herald (180), The Philadelphia Inquirer and Daily News (200), and The Seattle Times (300). The New York Times cut 69 jobs last January, 47 more in April, and about 1200 in June. Knight Ridder expects to shed 1700 this year; Reuters, a few hundred.
God knows how these people are paying the bills; they must have fumed last week when Bush said there would be no "instant gratification" for this economic crisis. Of course, the compassionate conservatives would rather give tax cuts to corporations than subsidies to individuals in need. And no one expects the once altruistic Steve Brill to bankroll a 21st-century equivalent of the Works Progress Administration, a program launched by President Roosevelt in the 1930s that paid creative types modest wages to practice their art.
Meanwhile, media companies continue their slow process of dying from within, a/k/a belt-tightening. This can be more or less subtle. At Primedia, there is talk of selling off New York magazine, though execs deny it. New Yorker employees can no longer use a car service unless they pay first with their own credit cards, and their expense account lunches are now subject to infinite restrictions. Last week, two days after the Daily News began soliciting pro-Giuliani display ads from readers, the New York Post did the same. And here at the Voice, offices are now closed on weekendsa decision which management attributes to "security," but which most regard as a cynical money-saver.
Industry-wide, complaints have been muffled; everyone who's ever collected a salary knows the price of dissent. But last week, shortly after Time Inc. canned the remainder of its mail-room staff, 351 employees sent a petition to CEO Don Logan, demanding that he put a stop to the layoffs that have been roiling Time Inc. all year. It was the loudest anti-layoff protest since March, when Jay Harris, publisher of The San Jose Mercury News, resigned on the ground that oncoming layoffs would compromise his editorial product. The owners didn't blink, and 120 people lost their jobs two months later.
Welcome to the desert. Are we dead yet?
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