Something interesting is happening as new media companies like Buzzfeed, Vox and Vice raise bucket loads in venture capital. They seem to be making themselves beholden to their advertisers in ways that their print predecessors never could…or would. And the future of a free and objective press may hang in the balance.
“The problem is that the economics of publishing have changed in the digital era, shifting the balance of power between advertisers and publishers to the former’s advantage,” writes Hampton Stephens in MediaShift.
“This means that advertising-dependent publishers must pay attention to the needs of advertisers to an unparalleled degree, in potential conflict with the best interests – and trust – of readers,” Stephens notes.
The traditional magazine giants have rebranded themselves as media companies, after having realized quickly enough that advertising alone – digital or print – is no longer enough to keep the lights on. Instead, they are innovating new revenue streams and focusing more on subscriptions, events and conferences to drive new revenue and allow them to maintain some editorial control.
Meanwhile the money continues to flow toward the new model.
“In an era when advertising-supported Web applications commonly achieve massive scale, and billion-dollar valuations for the startups that launched them, by being free to consumers, it’s not surprising that Silicon Valley investors would favor media companies with similar models,” Stephens writes.
“This trend is not particularly good news for journalism. Without some fundamental changes to their businesses, and to the incentives created by the advertising models that they have chosen to pursue, it’s unlikely that these new media companies will function as pillars of the ‘fourth estate’ in the usual sense,” he continues.
This doesn’t bode well for the future of digital journalism.
“To ensure the kind of ‘accountability journalism’ that is critical for any democracy to flourish, well-funded new media players must experiment with models other than advertising.”
The survivors of the last upheaval have begun to figure this out. We wonder how long before the new digital “news” content creators that are focusing on the ad dollars and associated sponsored content fees get wise to this.