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Digital media in the 2010s was totally dominated by sites like Vice and Buzzfeed. But now, these outlets are in trouble. What exactly is going on?
With a young audience and the constant churn of viral content, it seemed like these sites were doing pretty well, with Vice being valued at almost US$6 billion in 2017. Now, Vice is actually facing bankruptcy, and Buzzfeed is folding its news division. The digital media landscape doesn’t seem to be working like it used to. Meanwhile, more traditional news outlets, like The New York Times, are doing just fine. The NYT hit its goal of 10 million paid subscribers back in 2022 and is working toward a goal of 15 million before 2028.
Media companies like Vice and Buzzfeed News were doing really well on social media, but those numbers weren’t translating to their actual websites. While the companies were raising a lot of money from investors, those investors had big expectations, at least partly based on how these outlets were performing on social media. After a while, it became clear that the numbers weren’t working for the media websites, which means that the advertising dollars weren’t piling up. On top of that, it seems like some other media companies, like Gawker, began to struggle financially because of legal troubles.
“I think the big shift was the discovery of digital media as a category and the infusion of vast amounts of capital. That really started with the AOL acquisition of Huffington Post in 2011 and the Andreessen investment in BuzzFeed [in 2014],” Gawker Media owner Nick Denton told Vox. “Transactions like that, transactions in the early period of the teens that really caused costs to increase, and caused all of our ambitions to inflate — and ultimately led to a reckoning. In our case, the reckoning of legal costs that we couldn’t withstand, and in other people’s case, other competitive pressures.”
At the same time, sites like Google and Facebook constantly shift their algorithms, which disrupts visitor flow, too.
“It’s a whole combination of things, and everywhere you look, there’s a different factor,” said Emily Bell, director of the Tow Center for Digital Journalism at Columbia University. “Social platforms are, generally speaking, not places where you can build a business.”