For all the trouble with audiences, the economics of journalism in general are remarkably strong.
In the older media sectors, profitability remains robust. Newspapers made around a 20 percent profit in 2003. Local television news stations make roughly double that. Radio news, too, is a significant contributor to the bottom line for its owners, representing about 11 percent of the revenues of major radio companies.
Network television news is still a big revenue engine and in the late 1990s was perhaps the most reliably profitable part of the network television business, ahead of entertainment. But major news events like the war in Iraq cost so much to cover, network insiders say privately, that they whittled down profitability in 2003.
How can revenues be up for these media where audiences are down? In an era of fragmentation, these media continue to stand out as among the few places where advertisers can still attract a crowd. It may not be as big a crowd as it once was, but attracting any crowd has become harder.
Yet as other sectors attract more of the audience, they are attracting more and more advertising. Ad revenues for Spanish-language newspapers, for instance, have increased sevenfold between 1990 and 2001, from $111 million to $786 million, according to figures from the Latino Print Network.
The Internet, in turn, began to turn the corner on profitability in 2003, though the medium still relies largely on old media for its content and in many instances much of its costs. The overall profit numbers are small compared with traditional media, and some major Web sites are still not breaking even. Nonetheless, profits are growing at huge rates. If that continues, in a few years they will be significant contributors to company coffers.
What is less clear, however, is what economic model will work online. Will it be advertising based (like television), subscription based or some combination, and will those profits ever be enough to subsidize the kind of news gathering that newspapers and television did in their heyday. If the Internet is profitable, but not as profitable as old media, the result may be fewer resources for gathering news, spread over more outlets.