In the last decade, the outlook for news publishers has considerably declined. Consequently, billionaires such as Jeff Bezos, founder of Amazon, and Dr. Patrick Soon-Shiong, a biotechnology and start-up tycoon, have purchased some of the country’s most prominent brands, namely The Washington Post and The Los Angeles Times. In 2018, Marc Benioff and his wife bought Time magazine for $190 million. The new owners’ business acumen and tech expertise were anticipated to help resolve the conundrum of generating revenue as a digital publication.
Despite these businesses’ notable investments and the intensive implementation of strategies to create new revenue streams, losses have been incurred by Time, The Washington Post and The Los Angeles Times, as revealed by insiders familiar with the companies’ finances. Harvard’s Nieman Foundation for Journalism curator, Ann Marie Lipinski, said that “wealth doesn’t insulate an owner from the serious challenges plaguing many media companies, and it turns out being a billionaire isn’t a predictor for solving those problems.” Employees have placed naïve hope in the owners’ ability to drive recovery, which is seemingly falling short.
The most immediate aftermath of these losses is felt at The Los Angeles Times, where employees are bracing for the worst. Last week, Kevin Merida, the newspaper’s editor, resigned. His decision came following tensions with Dr. Soon-Shiong over editorial and business priorities, according to insiders. Projections indicate that the newspaper was expected to lose between $30 million and $40 million by 2023. Executives have been in discussions on the possibility of significant job cuts, which have already occurred, with approximately 74 jobs cut last year. The Los Angeles Times Union has organised an emergency meeting to discuss the need for more job cuts, which suggests this may be the “big one” for the company’s future.
Billionaire ownership appears to be an unmitigated disaster for publishers, with the likes of The Washington Post, The Los Angeles Times and Time magazine all struggling to maintain profitability over the last year. The owners appear not to have the magic solution that they were anticipated to bring. Despite the fact that their deep pockets led to acquisitions, the results suggest their unfamiliarity with media publishing is a stumbling block in the quest to monetise digital publishers. As publishers deal with the fallout of the pandemic, it will be interesting to see how the billionaires’ ownership pans out over the coming years.
The development also leads media publishers to reflect on the current state of journalism. With the changing times and the digital revolution, mass media is struggling to adapt and keep up with the demands of its consumers. The move towards digitisation has led to the proliferation of unreliable sources of news, which makes the job of reputable public news outlets more challenging. Furthermore, widespread access to the internet has led to a considerable drop in print circulation, which results in reduced advertising revenue.