Is journalism’s ‘pivot to dust’ arriving?

The journalism business has spent years chasing readers across the Internet. There were blogs, online chats, slide shows, listicles, search-engine optimization, infographics, podcasts . . . and, oh, yes, the fantastically expensive industry-wide “pivot to video.” After a decade and a half of this exhausting effort, we now seem to be arriving at the end of the journey: what Robby Soave at Reason.com dryly dubs “the pivot to dust.”

About 15 percent of the newsroom will be laid off at BuzzFeed; 7 percent at the media division of Verizon, which owns AOL, HuffPost and Yahoo. And newspaper chain Gannett swung the ax through several of its publications this week, including the Indianapolis Star, the Tennessean and the Arizona Republic. The brutal round of layoffs was hardly the first to hit the industry, and each new round leaves the newly unemployed with fewer places left to go.

Customarily, this is the moment where the writer offers a plan to save journalism, floating fresh approaches and citing unmet needs. I wish I could do that, and even more, I wish I could believe it. What I believe instead is that we’re watching the destruction of most of the nation’s journalistic capacity.

Fifteen years have been spent in a fruitless search for a viable business model that will support the kind of journalism the country expects — and, no, conservatives, I’m not talking about “the liberal media.” I’m talking about media organizations that pour resources into informing the public about the everyday, noncontroversial stuff that makes up the bulk of media content.

The journalism business isn’t being destroyed because its liberal skew alienated readers. The problem isn’t getting readers; the problem is monetizing them as they move online. Facebook and Google and Monster and Craigslist have hoovered up the advertising dollars that used to pay for reporting.

It’s telling that the conservative publications that were supposed to correct the flaws of mainstream media have instead often ended up in a symbiotic relationship with it. Instead of setting up comprehensive reporting operations of their own, they spend much of their time reacting to reporting done by mainstream outlets. Reporting is obscenely expensive, and no one — conservative, liberal or in between — has figured out how to fund it on shrinking advertising dollars.

But I’m also not joining the left in complaining that the industry is being destroyed by “capitalism.” Capitalism created the industry. Pre-capitalist societies don’t have newspapers and magazines; anti-capitalist societies have them, but only in the sense that Grigory Potemkin had villages. No, the journalism business is wedded to capitalism through and through; capitalism just seems to have tired of the arrangement.

And like anyone else whose spouse is losing interest, the industry has tried — oh, how it has tried! — to win back capitalism’s affections, with more makeovers than a Hollywood starlet. As usual, this didn’t resolve the underlying problem: The main competition for ad dollars now comes from massive tech companies that don’t produce content at all.

Journalism isn’t going away, exactly. There are business models that work, largely two: funding by donors or wealthy owners willing to operate at a loss, or subscriptions. But those models can’t support all the journalism now being done. The number of donors doesn’t magically increase just because more are needed. And subscription models have limits, because most people can only afford a few at a time.

Yet digital subscriptions offer enormous economies of scale, unlike print subscriptions that involve printing and moving lots of bulky paper. Once a digital article has been written, an increasing readership costs the publisher almost nothing; in economist-speak, the marginal cost is near zero. Industries with huge economies of scale tend to consolidate into a few big companies that can capture them most efficiently.

That means journalism’s likely future is in a small number of media companies expanding and a large number collapsing, taking most of the journalism jobs with them. That obviously means big changes ahead for many in the media — but also for readers, who have learned to rely on a Web full of free hyperlinks.

Those links go to reporting subsidized somewhat by digital ads but mostly by print circulations and speculative investments from outside the industry. As the journalism business burns through the last of those subsidies, large swaths of the free Internet are going to be paywalled off, and readers and journalists alike will have to learn to think of news as their parents did: as something you pay for, or do without.

Read more from Megan McArdle’s archive, follow her on Twitter or subscribe to her updates on Facebook.