A mounting body of evidence finds that the spread of mobile technology is adding to news consumption, strengthening the appeal of traditional news brands and even boosting reading of long-form journalism. But the evidence also shows that technology companies are strengthening their grip on who profits, according to the 2012 State of the News Media report by Pew Research Center’s Project for Excellence in Journalism.

The annual State of the News Media report is a comprehensive analysis of the health of journalism in America, which includes detailed analysis of eight different media sectors as well as an overview that identifies key trends and key findings of the essential statistics about news in the last year.

This year’s study also includes special reports on the impact of mobile technology and social media on news. Those reports, which feature new survey data, finds that rather than replacing media consumption on digital devices, people who go mobile are getting news on all their devices. They also appear to be getting it more often, and reading for longer periods of time. For example, about a third, 34%, of desktop/laptop news consumers now also get news on a smartphone. About a quarter, 27%, of smartphone news consumers also get news on a tablet. These digital news omnivores are also a large percentage of the smart phone/tablet population. And most of those individuals (78%) still get news on the desktop or laptop as well.

A PEJ survey of more than 3,000 adults also finds that the reputation or brand of a news organization, a very traditional idea, is the most important factor in determining where consumers go for news, and that is even truer on mobile devices than on laptops or desktops. Indeed, despite the explosion in social media use through the likes of Facebook and Twitter, recommendations from friends are not a major factor yet in steering news consumption.

Read the full report on the health of American journalism, which also includes findings on:

• How mobile devices are affecting news consumption
• The growing influence of technology giants on the future of news
• How new devices may be helping magazines
• The role of social media in news
• Which media sectors experienced revenue growth last year
• How a visually oriented year helped TV news in 2011
• How Native American communities are turning to cellphones for news

Chapters of the report:

• Overview
• The year in the news
• Newspapers
• Network television
• Local television
• Cable television
• Mobile devices and news consumption
• Digital platforms
• What Facebook and Twitter mean for news
• Audio landscape
• Magazines
• Alternative weeklies
• Community News

By several measures, the state of the American news media improved in 2010.

After two dreadful years, most sectors of the industry saw revenue begin to recover. With some notable exceptions, cutbacks in newsrooms eased. And while still more talk than action, some experiments with new revenue models began to show signs of blossoming.

Among the major sectors, only newspapers suffered continued revenue declines last year — an unmistakable sign that the structural economic problems facing newspapers are more severe than those of other media. When the final tallies are in, we estimate 1,000 to 1,500 more newsroom jobs will have been lost — meaning newspaper newsrooms are 30% smaller than in 2000.

Beneath all this, however, a more fundamental challenge to journalism became clearer in the last year. The biggest issue ahead may not be lack of audience or even lack of new revenue experiments. It may be that in the digital realm the news industry is no longer in control of its own future.

News organizations — old and new — still produce most of the content audiences consume. But each technological advance has added a new layer of complexity — and a new set of players — in connecting that content to consumers and advertisers.

In the digital space, the organizations that produce the news increasingly rely on independent networks to sell their ads. They depend on aggregators (such as Google) and social networks (such as Facebook) to bring them a substantial portion of their audience. And now, as news consumption becomes more mobile, news companies must follow the rules of device makers (such as Apple) and software developers (Google again) to deliver their content. Each new platform often requires a new software program. And the new players take a share of the revenue and in many cases also control the audience data.

Those data may be the most important commodity of all. In a media world where consumers decide what news they want to get and how they want to get it, the future will belong to those who understand the public’s changing behavior and can target content and advertising to snugly fit the interests of each user. That knowledge — and the expertise in gathering it — increasingly resides with technology companies outside journalism.

In the 20th century, the news media thrived by being the intermediary others needed to reach customers. In the 21st, increasingly there is a new intermediary: Software programmers, content aggregators and device makers control access to the public. The news industry, late to adapt and culturally more tied to content creation than engineering, finds itself more a follower than a leader in shaping its business.

Meanwhile, the pace of change continues to accelerate. Mobile has already become an important factor in news. A new survey released with this year’s report, produced with the Pew Internet & American Life Project, in association with the Knight Foundation, finds that nearly half of all Americans (47%) now get some form of local news on a mobile device. What they turn to most there is news that serves immediate needs — weather, information about restaurants and other local businesses, and traffic. And the move to mobile is only likely to grow. By January 2011, 7% of Americans reported owning some kind of electronic tablet. That was nearly double the number just four months earlier.

The migration to the web also continued to gather speed. In 2010, every news platform saw audiences either stall or decline — except for the internet. Cable news, one of the growth sectors of the last decade, is now shrinking, too. For the first time in at least a dozen years, the median audience declined at all three cable news channels.

For the first time, too, more people said they got news from the web than newspapers. The internet now trails only television among American adults as a destination for news, and the trend line shows the gap closing. Financially the tipping point also has come. When the final tally is in, online ad revenue in 2010 is projected to surpass print newspaper ad revenue for the first time. The problem for news is that by far the largest share of that online ad revenue goes to non-news sources, particularly to aggregators.

In the past, much of the experimentation in new journalism occurred locally, often financed by charitable grants, usually at small scale. Larger national online-only news organizations focused more on aggregation than original reporting. In 2010, however, some of the biggest new media institutions began to develop original newsgathering in a significant way. Yahoo! added several dozen reporters across news, sports and finance. AOL had 900 journalists, 500 of them at its local Patch news operation. By the end of 2011, Bloomberg expects to have 150 journalists and analysts for its new Washington operation, Bloomberg Government. News Corp. has hired from 100 to 150, depending on the press reports, for its new tablet newspaper, The Daily, though not all may be journalists. Together these hires come close to matching the jobs that we estimate were lost in newspapers in 2010, the first time we have seen this kind of substitution.

A report in this year’s study also finds that new community media sites are beginning to put as much energy into securing new revenue streams — and refining audiences to do so — as creating content. Many also say they are doing more to curate user content.

Traditional newsrooms, meanwhile, are different places than they were before the recession. They are smaller, their aspirations have narrowed and their journalists are stretched thinner. But their leaders also say they are more adaptive, younger and more engaged in multimedia presentation, aggregation, blogging and user content. In some ways, new media and old, slowly and sometimes grudgingly, are coming to resemble each other.

The result is a news ecology full of experimentation and excitement, but also one that is uneven, has uncertain financial underpinning and some clear holes in coverage. Even in Seattle, one of the most vibrant places for new media, “some vitally important stories are less likely to be covered,” said Diane Douglas who runs a local civic group and considers the decentralization of media voices a healthy change. “It’s very frightening to think of those gaps and all the more insidious because you don’t know what you don’t know.” Some also worry that with lower pay, more demands for speed, less training, and more volunteer work, there is a general devaluing and even what scholar Robert Picard has called a “de-skilling” of the profession.

Among the features in this, the eighth edition of the State of the News Media produced by the Pew Research Center’s Project for Excellence in Journalism, is a report on how American newspapers fare relative to those in other countries, two reports on the status of community media, a survey on mobile and paid content in local news, and a report on African American media. The chapters this year have also been reorganized and streamlined: each is made up now of a Summary Essay and a longer, separate Data Section where all the statistical information is more easily searchable and interactive.

Read the full report at journalism.org.

What now?

Inside news companies, the most immediate concern is how much revenue lost in the recession the industry will regain as the economy improves.

Whatever the answers, the future of news ultimately rests on more long-term concerns: What are the prospects for alternative journalism organizations that are forming around the country? Will traditional media adapt and innovate amid continuing pressures to thin their ranks?

And with growing evidence that conventional advertising online will never sustain the industry, what progress is being made to find new revenue for financing the gathering and reporting of news?

The numbers for 2009 reveal just how urgent these questions are becoming. Newspapers, including online, saw ad revenue fall 26% during the year, which brings the total loss over the last three years to 43%.

Local television ad revenue fell 22% in 2009; triple the decline the year before. Radio also was off 22%. Magazine ad revenue dropped 17%, network TV 8% (and news alone probably more). Online ad revenue overall fell about 5%, and revenue to news sites most likely also fared much worse.

Only cable news among the commercial news sectors did not suffer declining revenue last year.

The estimates for what happens after the economy rebounds vary and even then are only guesses. The market research and investment banking firm Veronis Suhler Stevenson projects that by 2013, after the economic recovery, three elements of old media — newspapers, radio and magazines — will take in 41% less in ad revenues than they did in 2006.

(Who owns the news media? View an interactive database of companies that own news properties in the United States at journalism.org.)

For newspapers, which still provide the largest share of reportorial journalism in the United States, the metaphor that comes to mind is sand in an hourglass. The shrinking money left in print, which still provides 90% of the industry’s funds, is the amount of time left to invent new revenue models online. The industry must find a new model before that money runs out.

The losses are already enormous. To quantify the impact, with colleague Rick Edmonds of the Poynter Institute, we estimate that the newspaper industry has lost $1.6 billion in annual reporting and editing capacity since 2000, or roughly 30%. That leaves an estimated $4.4 billion remaining. Even if the economy improves we predict more cuts in 2010.

Network news division resources are likely down from their peak in the late 1980s by more than half — which amounts to hundreds of millions of dollars — and new rounds of cuts came in the last 12 months. Local television is harder to gauge, but one estimate puts the losses in the last two years at over 1,600 jobs, or roughly 6%. Staffing at the news magazines Time and Newsweek since 1983 is down by 47%.²

So what about the new media experiments growing around the country? There are certainly exciting things happening, from former journalists creating specialty news sites and community sites, to citizens covering neighborhoods, local blogs and social media.

In 2009, Twitter and other social media emerged as powerful tools for disseminating information and mobilizing citizens for purposes such as evading the censors in Iran and communicating from the earthquake disaster zone in Haiti. The majority of internet users (59%) now use some kind of social media, including Twitter, blogging and networking sites, according to a new PEJ/Pew Internet & American Life survey.

Citizen journalism at the local level is expanding rapidly and brimming with innovation. This year’s report includes a new study of 60 of the most highly regarded sites. The prospects for assembling sufficient economies of scale, audience and authority may be most promising at specialized national and international sites — efforts like ProPublica, Kaiser Health News and Global Post.

For all the invention and energy, however, the scale of these new efforts still amounts to a small fraction of what has been lost. While not all of the blogs and citizen efforts can be quantified, J-Lab, a project led by Jan Schaffer that studies new media, estimates that roughly $141 million of nonprofit money has flowed into new media efforts over the last four years (not including public broadcasting). That is less than one-tenth of the losses in newspaper resources alone.

Michael Schudson, the sociologist of journalism at Columbia University, sees the promise of “a better array of public informational resources emerging.” This new ecosystem will include different “styles” of journalism, a mix of professional and amateur approaches and different economic models — commercial, nonprofit, public and “university-fueled.”

Clay Shirky of New York University has suggested that the loss of news people is a predictable and perhaps temporary gap in the process of creative destruction. “The old stuff gets broken faster than the new stuff is put in its place,” he has written.

There is something important in these notions. As Schudson notes, the news industry became more professional, skeptical and ethical beginning in the 1960s. Many journalists think that sense of public good has been overtaken by a focus on efficiency and profit since the 1990s. However, some of the new initiatives have re-invigorated the journalism mission of public interest and have helped to connect people within the community more.

(Explore and answer questions about media coverage in 2009 with PEJ’s News Interactive at journalism.org. The data are based on more than 68,700 stories analyzed in PEJ’s News Coverage Index for the year.)

Yet the energy and promise here cannot escape the question of resources. Unless some system of financing the production of content is developed, it is difficult to see how reportorial journalism will not continue to shrink, regardless of the potential tools offered by technology.

And as we enter 2010 there is little evidence that journalism online has found a sustaining revenue model. A new survey on online economics, released in this report for the first time, finds that 79% of online news consumers say they rarely if ever have clicked on an online ad.

There was certainly more talk of alternative approaches to advertising in the last year. Entrepreneur Steve Brill and others launched JournalismOnline.com, which offers news sites a mechanism for charging, but at this point it is more a possibility than a business reality. Rupert Murdoch announced discussions with Microsoft about higher payments for searching his content and insisted that everything his company produces would go behind pay walls. Columbia University produced a report that explored nonprofit and public funding sourcing and assessed the state of start up new media. The New York Times announced it was giving itself a year to figure out a way to charge for content to “get it really really right.” And more new media startups were planned, a growing sign that as old media continues to shrink, the ecosystem is changing and some things are growing.

But if a new model is to be found it is hardly clear what it will be. Our survey, produced with the Pew Internet & American Life Project, finds that only about a third of Americans (35%) have a news destination online they would call a “favorite,” and even among these users only 19% said they would continue to visit if that site put up a pay-wall.

In the meantime, perhaps one concept identifies most clearly what is going on in journalism: Most news organizations — new or old — are becoming niche operations, more specific in focus, brand and appeal and narrower, necessarily, in ambition.

Old media are trying to imagine the new smaller newsroom of the future in the relic of their old ones. New media are imagining the new newsroom from a blank slate and news ecosystem.

Among the critical questions all this will pose: Is there some collaborative model that would allow citizens and journalists to have the best of both worlds and add more capacity here? What ethical values about news will settle in at these sites? Will legacy and new media continue to cooperate more, sharing stories and pooling resources, and if they do, how can one operation vouch for the fairness and accuracy of something they did not produce?

The year ahead will not settle any of these. But the urgency of these questions will become more pronounced. And ultimately the players may be quite different.

“I think the answer may come from places staffed by young people who understand the new technology and its potential and who have a passion for journalism,” said Larry Jinks, the highly regarded former editor and publisher who transformed the San Jose Mercury News a generation ago and who still sits on the board of the McClatchy Company.

Major Trends

In past years we have tried to identify major trends emerging in the coming year, and many of those still apply now. For 2010, we want to emphasize six points.

As we learn more about both Web economics and consumer behavior, the unbundling of news seems increasingly central to journalism’s future. The old model of journalism involved news organizations taking revenue from one social transaction — the selling of real estate, cars and groceries or job hunting, for example — and using it to monitor civic life — covering city councils and zoning commissions and conducting watchdog investigations. Editors assembled a wide range of news, but the popularity of each story was subordinate to the value, and the aggregate audience, of the whole. And the value of the story might be found in its consequence rather than its popularity. That model is breaking down. Online, it is becoming increasingly clear, consumers are not seeking out news organizations for their full news agenda. They are hunting the news by topic and by event and grazing across multiple outlets. This is changing both the finances and the culture of newsrooms. When revenue is more closely tied to each story, what is the rationale for covering civic news that is consequential but has only limited interest? The data also are beginning to show a shift away from interest in local news toward more national and international topics as people have more access to such information, which may have other effects on local dynamics.

The future of new and old media are more tied together than some may think. A new multi-university study released in this report finds that even the best new-media sites in the country still have limited ability to produce content. No doubt they will evolve. Yet their reportorial capacity ultimately will still depend on finding a revenue model far larger than what exists today or is projected to come from conventional online advertising. While there are some competing values and different reportorial cultures, in the end new and old media face the same dilemma and may be much more aligned in their search for revenue than many have thought. In some cases, there will be formal alliances or networks of new and old media. One concept that will get more attention is collaborations of old media and citizens in what some call a “pro-am” (professional and amateur) model for news. Yet how traditional news organizations cope with such partnerships, the rules for what is acceptable and what is not, remain largely uncharted.

The notion that the news media are shrinking is mistaken. Reportorial journalism is getting smaller, but the commentary and discussion aspect of media, which adds analysis, passion and agenda shaping, is growing — in cable, radio, social media, blogs and elsewhere. For all the robust activity there, however, the numbers still suggest that these new media are largely filled with debate dependent on the shrinking base of reporting that began in the old media. Our ongoing analysis of more than a million blogs and social media sites, for instance, finds that 80% of the links are to U.S. legacy media. The only old media sector with growing audience numbers is cable, a place where the lion’s share of resources are spent on opinionated hosts. One result may be the rising numbers in polling data that show 71% of Americans now feel most news sources are biased in their coverage and 70% feel overwhelmed rather than informed by the amount of news and information they see. Quantitatively, argument rather than expanding information makes up the growing share of media people are exposed to today.

Technology is further shifting power to newsmakers, and the newest way is through their ability to control the initial account of events. For now at least, digital technology is shifting more emphasis and resources toward breaking news. Shrinking newsrooms are asking their remaining ranks to produce first accounts more quickly and feed multiple platforms. This is focusing more time on disseminating information and somewhat less on gathering it, making news people more reactive and less pro-active. It is also leading to a phenomenon in which the first accounts from newsmakers — their press conferences and press releases — make their way to the public often in a less vetted form, sometimes close to verbatim. Those first accounts, sculpted by official sources, then can spread more rapidly and widely now through the power of the Web to disseminate, gaining a velocity they once lacked. That is followed quickly by commentary. What is squeezed is the supplemental reporting that would unearth more facts and context about events. We saw this clearly in our study of news in Baltimore, but it is reinforced in discussions with news people. While technology makes it easier for citizens to participate, it is also making giving newsmakers more influence over the first impression the public receives.

The ranks of self-interested information providers are now growing rapidly and news organizations must define their relationship to them. As newsrooms get smaller, the range of non-journalistic players entering the information and news field is growing rapidly. The ranks include companies, think tanks, activists, government and partisan activists. Some are institutions frustrated by the shrinking space in conventional media and the absence of knowledgeable specialists to cover their subjects. Others are partisans and political interests trying to exploit a perceived opportunity in journalism’s contraction. There are varying degrees of transparency about the financing and intentions of these efforts. Some are quite clear. Others present themselves as purely journalistic and independent when in fact they are funded by political activists, yet only by digging and cross-referencing websites can the agenda and financing be divined. In an age where linking and aggregation are part of journalism, news organizations must decide how they want to interact with this growing cohort of self-interested information players. Will they pick up this material and disseminate it? Can they possibly police it? Can they afford to ignore it? The only certainty is that these new players are increasingly vying for the public’s and the media’s attention, and their resources, in contrast to that of traditional independent journalism, are growing.

When it comes to audience numbers online, traditional media content still prevails, which means the cutbacks in old media heavily impact what the public is learning through the new. An analysis in this year’s report of online audience behavior, extrapolated from Nielsen Net Ratings data, finds that 80% of the traffic to news and information sites is concentrated at the top 7% of sites. The vast majority of the top news sites (67%), moreover, are still tied to legacy media financed largely by their shrinking end of the business.³ New media are growing, but their ranks among the most trafficked sites are still small. Another 13% of these news sites are aggregators, whose content is derived from legacy media. Only 14% of these sites are online-only operations that produce mostly original reportorial content rather than commentary. In short, the cutbacks in old media are not only drastically affecting traditional media but significantly impact online content as well.

SECTOR HIGHLIGHTS

NEWSPAPERS

Newspapers are not disappearing in droves. Only half a dozen of any size went out of business or cut back print publication last year and most of those were second papers in their market. But newspapers have seen ad revenues fall by nearly half in three years, staff cutbacks are dramatic, if not quite as large, and a coming issue now is that papers are at risk of becoming insubstantial, lacking the heft to be tossed up on the front porch or to satisfy those readers still willing to pay for a good print newspaper.

ONLINE

The state of online news heading into 2010 may best be described as a moving target. Digital delivery is now well established as a part of most Americans’ daily news consumption. Six-in-ten Americans get some news online in a typical day — and most of these also get news from other media platforms as well.

NETWORK TV

As 2009 began, viewership of the evening newscasts actually rose for three months straight, but more declines quickly followed. What is occurring in network evening news is erosion, not a collapse. And there are new worries about the networks’ morning news programs. For years after evening numbers began to fall, morning shows were a bright spot. That is now changed. In 2009 morning news audiences fell for the fifth straight year. We estimate that network news staffs had already been cut by roughly half from their peak in the 1980s.

CABLE TV

Cable news in 2009, in nearly every indicator, was more robust than the previous year. Much of this growth was on the back of Fox News Channel, which offset some struggles at CNN and MSNBC. Ideology and opinion, now a centerpiece of the medium, was a key factor in that growth equation.

LOCAL TV

Almost all the indicators for local TV are pointing down. Audiences continue to fall for newscasts across all timeslots. Revenue, too, was in a free fall. Looking ahead, most market analysts project revenues to grow only slightly, but that is hardly taken as good news given that it is a year that includes both the midterm elections and winter Olympic Games. Stations may be nearing a point where they can no longer add new newscasts or new revenue opportunities, such as sponsored segments, to their old ones.

MAGAZINES

In a tough year for magazines, news magazines were especially hard hit despite efforts by some to re-invent themselves. Newsweek announced it would focus on analysis, rather than news, and U.S. News & World Report converted to a subject-specific monthly. Both lost readers in droves. The biggest winners were British: The Economist gained circulation, again, and The Week gained in ad pages.

AUDIO

The dynamics impacting audio’s future are clearer with each year. Most people still listen to news, talk and music for at least a little while every week, and they do most of this listening through traditional broadcast, or “terrestrial” radio. This is where the audience is largest. Yet this is where the profit and revenue are under the most pressure. Many stations have left the air and some owners of multiple stations have entered bankruptcy.

ETHNIC

In a year that saw the inauguration of the country’s first black president and the arrival on the Supreme Court of the first Hispanic justice, the ethnic news media managed to stay in relatively good health, despite the worst recession since the Great Depression. Some segments fared noticeably better than their mainstream counterparts, but there were areas of trouble. Perhaps more than anything else, 2009 spoke to both the unique appeal and particular fragility of media outlets that appeal to specific ethnic groups.

Find detailed analysis of audience trends, economics and news investment for each sector by reading the full report at journalism.org.

<sub>1. Cable figures are based on estimated combined ad revenues for CNN/HLN, Fox News Channel and MSNBC for 2008 and 2009, provided by SNL Kagan, a division of SNL Financial LLC. Online figures are total online display ad revenues, from January to September 2009, compared with the same period in 2008, provided by eMarketer. Network figures are based on revenue estimates for network television ads from January to September 2009, compared with the same period in 2008, provided by the Television Bureau of Advertising. Radio figures are based on AM/FM advertising revenues from January 2009 to January 2010, compared with the same period in 2008-2009, provided by the Radio Advertising Bureau. Magazine figures are based on ad pages sold – not revenue – provided by the Publishers Information Bureau for six news magazines: Time, Newsweek, The Economist, The Atlantic, The Week, and The New Yorker. Newspaper estimates are derived by Rick Edmonds of the Poynter Institute based on data provided by the National Newspaper Association. Local TV figures are based on revenue estimates for local and national spot advertising on local TV from January to September 2009, compared with the same period in 2008, provided by the Television Bureau of Advertising.
2. These figures, derived from analysis of staff boxes, show staffing at the two magazines of 710 in 1983 down to 373 in 2009.
3. The top news sites among Nielsen’s list of 4,600 are those sites with 500,000 unique visitors monthly, or the top 199 sites after government, consulting and database sites that do not produce news are culled from the list. The first reference includes all 4,600 sites on Nielsen’s list, which includes some government, consulting and databases that are not news.</sub>

Newspaper ad revenues have fallen 23% in the last two years. Some papers are in bankruptcy, and others have lost three-quarters of their value. By our calculations, nearly one out of every five journalists working for newspapers in 2001 is now gone, and 2009 may be the worst year yet.

In local television, news staffs, already too small to adequately cover their communities, are being cut at unprecedented rates; revenues fell by 7% in an election year — something unheard of — and ratings are now falling or flat across the schedule. In network news, even the rare programs increasing their ratings are seeing revenues fall.

The ethnic press is also troubled and in many ways is the most vulnerable because so many operations are small.

Only cable news really flourished in 2008, thanks to an Ahab-like focus on the 2008 election, although some of the ratings gains were erased after the election.

Percentage Change in Ad Spending by Medium — 2007 to 2008

Perhaps least noticed yet most important, the audience migration to the internet is now accelerating. The number of Americans who regularly go online for news, jumped 19% in the last two years, according to one survey; in 2008 alone traffic to the top 50 news sites rose 27%.

It is now all but settled that advertising revenue — the model that financed journalism for the last century — will be inadequate to do so in this one. Growing by a third annually just two years ago, online ad revenue to news websites now appears to be flattening; in newspapers it is declining.

Percentage Change in Audience, 2007 to 2008, Across Media

What does it all add up to?

Even before the recession, the fundamental question facing journalism was whether the news industry could win a race against the clock for survival: Could it find new ways to underwrite the gathering of news online, while using the declining revenue of the old platforms to finance the transition?

In the last year, two important things happened that have effectively shortened the time left on that clock.

First, the hastening audience migration to the Web means the news industry has to reinvent itself sooner than it thought — even if most of those people are going to traditional news destinations. At least in the short run, a bigger online audience has worsened things for legacy news sites, not helped them.

Audience Growth: Top News Sites vs. Select Political Sites

Then came the collapsing economy. The numbers are only guesses, but executives estimate that the recession at least doubled the revenue losses in the news industry in 2008, perhaps more in network television. Even more important, it swamped most of the efforts at finding new sources of revenue. In trying to reinvent the business, 2008 may have been a lost year, and 2009 threatens to be the same.

Imagine someone about to begin physical therapy following a stroke, suddenly contracting a debilitating secondary illness. Journalism, deluded by its profitability and fearful of technology, let others outside the industry steal chance after chance online. By 2008, the industry had finally begun to get serious. Now the global recession has made that harder.

This is the sixth edition of our annual report on the State of the News Media in the United States.

It is also the bleakest.

Much of what we have noted in the past holds true. The old media have held onto their audience even as consumers migrate online. In 2008, audience gains at sites offering legacy news were far larger than those for new media. The old norms of traditional journalism continue to have value. And when you look at the numbers closely, consumers are not just retreating to ideological places for news.

The problem facing American journalism is not fundamentally an audience problem or a credibility problem. It is a revenue problem — the decoupling, as we have described it before, of advertising from news.

That makes the situation better than it might have been. But audiences now consume news in new ways. They hunt and gather what they want when they want it, use search to comb among destinations and share what they find through a growing network of social media.

And the news industry does not know — and has done less than it could to learn — how to convert this more active online audience into revenue. In newspapers, roughly half of all classified advertising revenue has vanished, a good deal of that to operations that newspapers could have developed for themselves. Insiders now expect that classified revenue could be zero in five years — or sooner. When newspaper executives met this winter to talk about how to create a way for consumers to design their own ads, the discussion focused on doing so for print editions, not online. “They still don’t get it,” one irritated executive told us on background.

Print vs. Online Ad Expenditures, Newspapers

There are growing doubts within the business, indeed, about whether the generation in charge has the vision and the boldness to reinvent the industry. It is unclear, say some, who the innovative leaders are, and a good many well-known figures have left the business. Reinvention does not usually come from managers prudently charting course. It tends to come from risk takers trying the unreasonable, seeing what others cannot, imagining what is not there and creating it. We did not see much of it when times were better. Times are harder now.

In the last year, alternative news sites, have continued to grow, including those produced by journalists who have left legacy newsrooms, but their scale remains small. The new media in aggregate are far from compensating for the losses in coverage in traditional newsrooms, and despite enthusiasm and good work, few if any are profitable or even self-sustaining.

Those are just some of the questions and conclusions in this edition of our annual report on the state of American journalism. This year’s report, as always, offers a general overview of the state of journalism as well as detailed examinations of the state of eight separate sectors (newspapers, online, network television, cable television, local television, audio, magazines, and ethnic media). The report also includes our in-depth content analysis, based on a study of nearly 80,000 news stories and television and radio segments in A Year in the News, which this year includes an Interactive Topline where people can explore the data for themselves.

This year we also offer some special reports.

• A study of citizen-based media, including a university study of 363 citizen websites in 46 markets.
• The first-ever survey of the members of the Online News Association, to be released March 30.
• An essay by Bill Kovach and Tom Rosenstiel, Lessons of the Election.
• A backgrounder on the growing models of entrepreneurial journalism, new Web news organizations run by professional journalists outside the mainstream press.
• A review of changes in the last year in public attitudes in regards to the news media.

For the full report on the health and status of American journalism — including links to all sections and interactive tools — please see stateofthemedia.org.

You can also get a further round-up of all the findings and links in the executive summary and in a report on the major trends shaping journalism in 2009.

As gadgets with digital audio capability proliferate, podcast downloading continues to increase. Currently, 19% of all internet users say they have downloaded a podcast so they could listen to it or view it later. This most recent percentage is up from 12% of internet users who reported downloading podcasts in our August 2006 survey and 7% in our February-April 2006 survey.

Still, podcasting has yet to become a fixture in the everyday lives of internet users, as very few internet users download podcasts on a typical day. Even of those who say they download podcasts, just 17% do so on a typical day.

These results come from a nationally-representative telephone survey by the Pew Internet & American Life Project from April 8 – May 11, 2008 of 2,251 adults. The portion of the survey that covered podcast downloading was administered to 1,553 internet users. The margin of error on the internet sample is plus or minus 3 percentage points.

More Options for Podcast Downloaders

As demand for podcasts has grown, so too has the catalog of offerings for users. In November 2006, we reported that Podcast Alley, a popular podcast directory, cataloged over 26,000 podcasts with more than 1 million episodes.¹ Now, that number has nearly doubled to over 43,000 podcasts and well over 2 million episodes. The most extensive podcast genre is “technology” with over 4,000 podcasts available on the subject; this genre is followed closely by comedy, religion and spirituality, and business.²

Companies like iTunes regularly prompt users to subscribe to automatic daily downloads of their favorite podcasts.³ “Get podcasts, served fresh daily,” reads an advertisement on the iTunes Store podcast webpage. Instead of getting your morning newspaper delivered to your doorstep, you can get your daily podcast delivered to your iTunes desktop. (For instance, users can subscribe to daily podcasts of newspapers and magazines such as The Wall Street Journal and The Economist.)

College campuses have also served an important role in promoting podcasts. Many colleges and universities now provide podcasts of various lecture series and important speakers on campus. Some professors are experimenting with podcasts in other ways, such as producing their own podcasts or having their students respond to readings and lessons by creating podcasts rather than (or in addition to) traditional papers.

Who is Downloading Podcasts?

Men continue to be more likely than women to download podcasts; 22% of online men compared with just 16% of online women report ever having downloaded a podcast. However, men and women are equally likely (3%) to download podcasts on a typical day.

Age differences are more defined with regard to podcast downloading than they were in 2006 when all age groups, except for those 65 and older, were almost equally likely to download podcasts. Now, the dividing line is around the age of 50, with internet users under 50 years old significantly more likely than older users to download podcasts. Fully 23% of those under 50 say they have ever downloaded a podcast and 4% downloaded one yesterday, compared with 13% and 1% of their older counterparts. Since 2006, younger generations have more fully embraced the technology, their percentages nearly doubling since 2006.

Internet users with six or more years of internet experience are significantly more likely than those with less online experience to have ever downloaded a podcast, and they are also more likely to download podcasts on a typical day.

Broadband Access and Podcast Downloading

In a recent report on broadband adoption, we found that internet users who have broadband internet access at home are significantly more likely than those who have dial-up to have ever done certain online activities.⁴ In many cases, those with high-speed internet access at home are also significantly more likely than dial-up users to do these activities on a typical day. Over time, podcast downloading has been a key activity that internet users are much more likely to do if they have broadband access. Internet users who subscribe to premium home broadband services are even more likely to download podcasts.

Internet users with broadband and premium broadband access at home are also significantly more likely than the average internet user to have ever downloaded a podcast.

iPod and MP3 Player Ownership

Like podcast downloading, ownership of iPods and MP3 players has also increased since 2006. According to a December 2007 Pew Internet Project survey, 34% of American adults and 43% of internet users report owning an iPod or MP3 player, up from 20% of the total population and 26% of internet users in April 2006.

Young adults between 18 and 29 years old are the age group most likely to own MP3 players, 61% of whom own these gadgets. Parents, those with broadband access, and those with higher socio-economic status (higher income and education) are also considerably more likely to own MP3 players or iPods.

Notes

¹ “Podcast Downloading” (Pew Internet & American Life Project, November 22, 2006)

² Site statistics accessed on July 17, 2008 via the Podcast Alley website. Genre-specific statistics

³ Information found on July 17, 2008 on the iTunes store website podcast page.

⁴ “Broadband Adoption 2008” (Pew Internet & American Life Project, July 2008)

The state of the American news media in 2008 is more troubled than it was a year ago. And the problems, increasingly, appear to be different than many experts have predicted.

Critics have tended to see technology democratizing the media and traditional journalism in decline. Audiences, they say, are fragmenting across new information sources, breaking the grip of media elites. Some people even advocate the notion of “The Long Tail,” the idea that, with the Web’s infinite potential for depth, millions of niche markets could be bigger than the old mass market dominated by large companies and producers.

The reality appears increasingly more complex. Looking closely, a clear case for democratization is harder to make. Even with so many new sources, more people now consume what old media newsrooms produce, particularly from print, than before. Online, for instance, the top 10 news Web sites, drawing mostly from old brands, are more of an oligarchy, commanding a larger share of audience, than in the legacy media. The verdict on citizen media for now suggests limitations. And research shows blogs and public affairs Web sites attract a smaller audience than expected and are produced by people with even more elite backgrounds than journalists.

Certainly consumers have different expectations of the press and want a changed product.

But more and more it appears the biggest problem facing traditional media has less to do with where people get information than how to pay for it — the emerging reality that advertising isn’t migrating online with the consumer. The crisis in journalism, in other words, may not strictly be loss of audience. It may, more fundamentally, be the decoupling of news and advertising.

This more nuanced recognition is also putting into clearer relief what news people see as their basic challenge: Somehow they must reinvent their profession and their business model at the same time they are cutting back on their reporting and resources. “It’s like changing the oil in your car while you’re driving down the freeway,” said Howard Weaver, the chief news executive of the McClatchy Company.

In broad terms, the fundamental trends transforming how people acquire news continued in the last year. More effort keeps shifting toward processing information and away from original reporting. Fewer people are being asked to do more, and the era of reporters operating in multimedia has finally arrived. In newspapers, and to lesser extent in network television, an expanding list of buyouts and layoffs in 2007 was expected to grow further in 2008 — in some cases even at online organizations.

The pressure points vary by news sector. In print, the problem is vanishing advertising, particularly classified. Were it not for that one sector, newspapers’ problems would be comparatively modest. In television, where problems with audience are more acute, the industry is being sustained by the fact that still nothing compares to the persuasiveness of television advertising. Online, the problem is that the revenue model is in search, not conventional advertising — and journalism sites are now already lagging behind other internet sectors financially.

Despite all this, those who remain in the newsroom, particularly in print, evince a stubborn optimism — a sense of mission to prove what they consider a calling still has resonance and, in time, will find financial footing. Certainly there is skepticism on Wall Street, from the public, in some cases from owners. Yet experimentation is proving liberating, even if some experiments make news people queasy. News organizations, or at least some, have become places of risk and innovation and feel growing connection with audiences, something we could not have said a few years ago.

Read the full State of the Media 2008 report.

It has been 20 years since the Fairness Doctrine was repealed by the Federal Communications Commission (FCC). Yet in recent weeks, the rule that required broadcasters to balance views they aired on controversial subjects has re-emerged as a topic of debate in media circles—and particularly on talk radio.

Some hosts in the conservative-dominated talk radio universe have warned listeners that Congressional Democrats and liberals want to revive the Fairness Doctrine in an effort to silence voices and views they don’t like. And some have warned that any return to the rule would produce a “Hush Rush Bill.” (The National Review published a recent cover story on the topic, complete with a photo of Rush Limbaugh gagged with duct tape.)

A few weeks ago, Limbaugh raised that prospect when he described his show as something “that frightens and scares the American left to the point that they want to deny this program Constitutional access to the First Amendment.”

Conversely, Ed Schultz, a syndicated liberal talker, has accused conservatives of setting up a “straw man” by playing up the threat of a new Fairness Doctrine. “I can guarantee you folks that no one is out there saying ‘let’s have the Fairness Doctrine,”’ Schultz declared, and he blamed conservatives for trying to stifle liberal voices on the air.

What is the Fairness Doctrine and what is going on here? Some background seems in order:

What exactly was the Fairness Doctrine and what happened to it?

Created by the FCC in 1949, the Fairness Doctrine was a set of rules based on the idea that the airwaves were in scarce supply and were owned by the public, with TV and radio stations functioning as “public trustees.” As such, the FCC required that broadcasters provide a reasonable opportunity for “ample play for the free and fair competition of opposing views … [for all] issues of importance to the public.”

Stations, in other words, had to carry contrasting opinions on the important issues of the day.

The Fairness Doctrine survived for decades and was affirmed as constitutional by the Supreme Court in 1969. But in the 1980s, during Ronald Reagan’s administration, the FCC revisited the subject. The agency concluded that the rise of cable television had eased some of the scarcity issues and that the Fairness Doctrine might be chilling speech by keeping broadcasters from addressing important issues out of a reluctance to represent both sides. In August 1987, the FCC repealed the Fairness Doctrine.

Did ending the Fairness Doctrine give birth to conservative talk radio?

Some observers have long held that the end of the Fairness Doctrine helped usher in the era of conservative-dominated talk radio by ending the requirement of editorial balance. Under the doctrine, Limbaugh’s conservatism would need a counterpoint, and positioning a radio station format solely toward a conservative audience would have been impossible.

That’s not quite accurate, according to Andrew Schwartzman of the Media Access Project, a non-profit media and telecom law firm.

The major reason for the rise of national talk personalities like Limbaugh, Schwartzman believes, was a change in the cost of national satellite distribution. Syndicated programming meant that stations no longer had to develop their own local talent. Instead, they could simply bring in national voices that had already proven themselves in other markets for less money. Those national voices belonged to the most successful talk hosts, many of whom were conservatives.

“Rush Limbaugh was around before 1987,” Schwartzman said. “In the 1980s what really happened was national syndication and it happened in a big way.”

The Fairness Doctrine, however, was not forgotten. Congress twice tried to reestablish it — in 1987 and later during the George H.W. Bush administration — but both efforts ran into presidential opposition and failed.

Whatever the reason, the news/talk radio format took off in the 1990s. According to one industry data base, there were about 360 news/talk stations in 1990. Today, there are more than 1,300.

Why are people arguing over a rule that hasn’t existed for 20 years?

In late June, a confluence of events suddenly pushed the long-buried Fairness Doctrine back into the media spotlight.

For one thing, The Center for American Progress, a liberal advocacy group, released a report on June 20 headlined, “The Structural Imbalance of Political Talk Radio.” It concluded that among the top five radio station owners “91% of the total weekday talk radio programming is conservative.”

Around the same time, a number of talk hosts, predominantly conservative, mounted an aggressive campaign against the immigration bill supported primarily by President Bush and a coalition that included Senate Democrats and some Republicans. After a bitter legislative battle, the measure died in the Senate on June 28, and some of the talkers openly celebrated that result on the air, even taking credit for helping make it happen.

The talk hosts’ role in the immigration debate got some Democrats talking about a possible return to the Fairness Doctrine. In a June 25 interview with Fox News, California Senator Dianne Feinstein said she was “looking at” bringing it back. Two days later, a Capitol Hill newspaper quoted Illinois Senator Dick Durbin saying it was “time to reinstitute the Fairness Doctrine.”

Even some conservative Republicans expressed frustration with the radio hosts. Appearing with Feinstein on Fox News, Mississippi Sen. Trent Lott uttered the memorable statement that “Talk radio is running America. We have to do something about that problem.”

Given those comments, some in Congress decided to move preemptively. On June 28, the House (by a 309-115 vote) passed a measure pushed by Republicans that would deny the FCC the money to implement the Fairness Doctrine, should it be reinstated.

Schwartzman said the recent Fairness Doctrine furor has a lot to do with constituent politics. While liberals are making their “ritual remarks” about restoring it, in part to please their base, conservatives are seizing on those remarks for much the same reason, he said.

What are the chances the Fairness Doctrine will be coming back soon?

Even according to some Democratic lawmakers who have expressed interest in the issue, there isn’t significant momentum for a revival of the Fairness Doctrine.

A spokesman for Feinstein said there is no pending legislation, no scheduled hearings, nor any meetings related to the subject. On the House side, a spokesperson for Democratic Ohio Congressman Dennis Kucinich, who heads the subcommittee with authority over the FCC, also said no action is pending in that body.

The Center for American Progress, which issued the report asserting that talk radio is ideologically tilted to the right, is not calling for a reinstatement of the Fairness Doctrine. The group, which said the repeal of the doctrine is not an adequate explanation for the dominance of conservative talk, focuses more on the issue of the conglomeration of media ownership as a cause.

Tom Taylor, publisher of a radio industry newsletter, has no doubts about the Fairness Doctrine’s ability to stir passions. “You think the Israeli-Palestinian conflict is full of hard feelings,” he said, “you watch what happens if you try to hold a hearing on the Fairness Doctrine.” However, for all the rhetoric floating around, Taylor believes there is virtually no likelihood of a legislative effort to revive it.

Taylor said that even if the doctrine were reinstated, it wouldn’t “hush Rush.” Conservative and liberal talkers wouldn’t be required to introduce balance into their own programs. Rather the stations that air those shows would have to allow opposing views to be heard at some point in the day. (And that could be in the wee small hours of the morning.)

“Let’s just be kind and say there is some bad information floating around out there,” Taylor said. “But, you know, it sure is a great topic for talk radio.”

For more on related topics visit journalism.org.

On June 8 — the day after the immigration bill suffered a major defeat when its backers failed to get a Senate vote — there was barely disguised gloating on the part of some talk hosts.

CNN’s Lou Dobbs, a staunch opponent of the bill who has spent more time on immigration than any other host, opened his program by announcing “a crushing defeat for the pro-illegal alien lobby in its efforts to ram amnesty through the U.S. Senate in defiance of the will of the American people.”

Substituting for Rush Limbaugh, conservative radio talker Roger Hedgecock told his listeners that this was a case of “everyone on the talk show circuit…talking about this issue in a way that has educated a larger percentage of Americans to what’s really at stake than the Senate is used to.”

On the same day, radio host Michael Savage, another fierce opponent of the measure, responded to the criticism that extremist hosts had conspired to defeat the bill by quoting conservative icon Barry Goldwater.

“As a great American once said, ‘extremism in the defense of liberty is no vice.’”

According to the Project for Excellence in Journalism’s Talk Show Index, in the period from May 13 through June 8, the immigration debate was the second-most popular talk topic (18%), narrowly trailing the presidential race (21%) and doubling the time spent on the next biggest subject, the Iraq policy debate (9%).

But while the amount of time devoted to the subject is telling, equally revealing is the question of who talked about it. In that 26-day period, the airwaves were dominated by vocal hosts opposed to the legislation who often referred to it with the politically damning term “amnesty bill.”

Americans, both black and white, generally agree with the punishment radio host Don Imus received for the racist and sexist remarks he made about the Rutgers University’s women basketball team. Nonetheless, there are substantial racial differences in views of Imus’s punishment, and an even bigger gap in opinions about news media’s coverage of the story.

Majorities of both whites (53%) and African Americans (61%) who have been following the Imus story say that the punishment he received was appropriate. But roughly twice as many whites as blacks believe his punishment was too tough (35% vs. 18%). On April 12, the talk show host’s morning radio program was cancelled by CBS. A day earlier, a cable television simulcast of the program on MSNBC was cancelled by NBC.

Fully 62% of whites say that news organizations are giving too much coverage to the Imus story. This compares with just 31% of African Americans who believe the controversy has been overcovered. A plurality of blacks (44%) says that the amount of coverage has been appropriate, while a sizable minority (18%) says it has gotten too little coverage.

Imus-Type Comments Heard Frequently

More than four-in-ten Americans (42%) who have been following the Imus story say that, based on what they know about the radio host’s comments, they often or sometimes hear that kind of language used in their daily lives. African Americans – particularly black men – are far more likely than whites to say they frequently hear such language.

Overall, 55% of blacks who have heard a lot or a little about the story say they often or sometimes hear the sort of language that Imus used in denigrating the Rutgers players; by comparison, 38% of whites who have heard about the Imus story say they often or sometimes hear such language. There also are significant gender differences, among those in both races, in views of how often such language is used.

For example, about a third of black men (32%) say they often hear the sort of language that Imus used; this compares with 20% of black women. Among whites, 22% of men, but only 13% of women, say they frequently hear such language.

There also are large age differences in these perceptions, with young people much more likely than older Americans to report often or sometimes hearing this type of language. And younger African Americans, in particular, say they frequently hear the type of language Imus used. Fully 74% of African Americans under age 40 say they often or sometimes hear such language, compared with 44% of whites in the same age group.

Who Uses Offensive Language

Among those who have been following the Imus story, 38% say that “most” or “many” black males make racist or sexist remarks without thinking about it. By comparison, about a quarter of this group (27%) says that most or many white males use such language without thinking.

This is an issue on which blacks and whites generally agree: 39% of blacks say most or many African American males use racist or sexist language without thinking about it, while somewhat fewer blacks (31%) believe that white males use that kind of language unthinkingly. Attitudes are comparable among whites – 37% of whites say most or many black males make racist or sexist remarks, while 26% of whites say many or most white males make such comments.

Notably, a majority of African Americans under age 40 (53%) say that most or many black males make racist or sexist remarks without thinking about it. A smaller number of younger African Americans (39%) say most or many white males use such language.