US media sector braces for brutal year for jobs

In this file photo taken on May 16, 2019 the building of the Washington Post newspaper headquarters is seen in Washington, DC. The struggling US media industry is facing its worst year for job layoffs in a decade as news organizations continue to cut staff and close shop, according to a new survey. (AFP / Eric Baradat)
Updated 06 July 2019
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US media sector braces for brutal year for jobs

WASHINGTON: The struggling US media industry is facing its worst year for job layoffs in a decade as news organizations continue to cut staff and close shop, according to a new survey.
The consultancy Challenger Gray & Christmas reported this week that media companies, which include movies, television, publishing, music, and broadcast and print news, announced plans to cut 15,474 jobs so far this year, of which 11,878 of which were from news organizations.
That is nearly three times more than the 4,062 cuts announced in the media sector in 2017 and the highest total since the economic crisis in 2009.
“Members of the media, especially journalists, have had a tough few years,” said Andrew Challenger, vice president of the Chicago-based firm.
“Many jobs were already in jeopardy due to a business model that tried to meet consumer demand for free news with ad revenue. As media outlets attempted to put news behind pay walls, in many markets, consumers opted not to pay.”
Some of the notable events this year included the closing of the Youngstown Vindicator, the only daily in the Ohio city, with 144 jobs lost, and the sale of the New Orleans Times-Picayune resulting in the loss of some 160 positions including 65 in the newsroom.
But the troubles have also impacted the digital sector with BuzzFeed cutting 200 employees in January and Verizon eliminating 800 jobs in its media division, which includes Yahoo, AOL, and HuffPost, the Challenger report noted.
The report noted that media companies have been unable to keep pace with Facebook and Google in tailoring ads for customers based on their interests, making it hard to generate online revenue.
It also noted that a rise in browser ad blocking extensions has made it increasingly difficult to monetize online news.
“Job cuts and consolidations are likely to continue until these companies are able to find ways to create growth in revenue streams,” Andrew Challenger said.
He added that subscription-based models will only work if news organizations can convince consumers of the importance and value of their news.
“Another possibility for media companies is to monetize users’ personal data, as Facebook and Google have,” he said.
“There are obvious ethical implications and potential legal issues, however, especially as privacy laws begin to pass in various jurisdictions across the country. Ultimately, the quality of the country’s news will start to decline if we as users refuse to pay for it.”


Netflix to roll out cheaper mobile-only plan for India

Updated 18 July 2019
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Netflix to roll out cheaper mobile-only plan for India

  • India is among the last big growth markets for the company
  • Netflix faces competition from Amazon’s Prime Video and Walt Disney Co’s Hotstar
Netflix said on Wednesday it would roll out a lower-priced mobile-only plan in India within the next three months to tap into a price-sensitive market at a time the streaming company is losing customers in its home turf.
India is among the last big growth markets for the company, where it faces competition from Amazon.com Inc’s Prime Video and Hotstar, a video streaming platform owned by Walt Disney Co’s India unit.
Netflix lost US streaming customers for the first time in eight years on Wednesday, when it posted quarterly results. It also missed targets for new subscribers overseas.
“India is a mobile-first nation, where many first-time users are experiencing the Internet on their phones. In such a scenario, a mobile-only package makes sense to target new users,” said Tarun Pathak, analyst at Counterpoint Research.
The creator of “Stranger Things” and “The Crown” said in March that it was testing a 250-rupee ($3.63) monthly subscription for mobile devices in India, where data plans are among the cheapest in the world.
The country figures prominently in Chief Executive Officer Reed Hastings’ global expansion plans.
“We believe this plan, which will launch in the third quarter, will be an effective way to introduce a larger number of people in India to Netflix and to further expand our business,” the company said in a letter to investors released late on Wednesday.
Netflix currently offers three monthly plans in India, priced between 500 rupees ($7.27) and 800 rupees $11.63).
It has created a niche following in the country by launching local original shows like the thriller “Sacred Games” and dystopian tale “Leila,” which feature popular Bollywood actors.
The second season of “Sacred Games” is set to release in August.
In contrast, Hotstar, which also offers content from AT&T Inc’s HBO and also streams live sports, charges 299 rupees ($4.35) per month. Amazon bundles its video and music streaming services with its Prime membership.
“We’ve been seeing nice steady increases in engagement with our Indian viewers that we think we can keep building on. Growth in that country is a marathon, so we’re in it for the long haul,” Netflix Chief Content Officer Ted Sarandos said.