A Deeper Dive Into What Really Damaged Newspapers - A Media Operator

I think there are three algorithms that have reshaped the American press in ways that we are just now starting to confront. You have Google and Facebook, which can serve up this incredible fire hose of traffic to publishers so long as they cater to the ever-shifting whims of that algorithm.

The reason newspapers are dying is because they’re stuck with massive fixed costs when the businesses no longer require them. It is expensive running a printing operation. Additionally, the infrastructure that gets built up to support hundreds of employees is also very expensive.

The distribution channels that underpinned the rise of today’s Internet giants have dried up. Google, Facebook, and Amazon serve as a triopoly that dominates online advertising. The three accounted for 90% of US digital advertising in 2020, up from 80% in 2019. The arbitrage that once existed on these platforms has more or less disappeared and CPMs... See more

Stepping back, though we should probably ask where all these ad budgets are coming from, and, more importantly, where the growth for internet advertising will come from next. The obvious answer is television: print is mostly already gone, but ‘TV’ viewing is now finally unlocking, with US pay TV subscriptions now down by over a third