According to Betteridge’s law, the answer to all headline questions is, of course, no. But the last few weeks have seen some stories about digital media organisations that have shaken the firm belief that digital can stand alone profitably with a bright future as print lies spluttering.
In a single week it emerged that Buzzfeed and Vice are going to miss their revenue targets, Mashable was sold for $50 million, and the resistance to the Duopoly is growing as Broadcasters, the FT’s Lionel Barber and the Guardian’s Kath Viner have all waded in.
These events all set the tone of this episode of the Media Voices podcast, dedicated entirely to this question of whether we’re witnessing the beginning of the end for digital media.
People have long been saying ‘print is dead’ but it is becoming clear that digital was dead from the start – at least as a sole revenue source – despite all the hope and all the resources that companies have been pouring into it.
One of the poster boys for digital pureplays, Buzzfeed is set to miss its revenue targets, dashing hopes of an IPO next year. It was aiming for $350 million, but is looking to be at least 15-20% off that figure. By itself it’s not too big an issue, but Vice, another high-profile pureplay is rumoured to be missing its own targets as well. Vice was valued at $5.7 billion when private-equity firm TPG invested $450 million in June this year. The company’s investors are said to be pushing it to rein in costs and achieve profitability next year.
To top it off, Mashable has agreed to sell to Ziff Davis for $50 million, which is 20% of its 2016 valuation of $250 million following a $15 million round of funding last year led by Time Warner’s Turner.
The ‘digital dream’ of easy money streaming in, matching the revenue of the golden days of print is over, argues Peter, but it’s not the death of digital media at all. As a form of media, it’s not going away any time soon, but it won’t be able to cover the burgeoning costs of legacy print structures.
Esther points out that rather than being the death of digital, it should instead be the death of overvaluations, a point that Neil Thackray had made on Twitter. “Buzzfeed are growing, and they’re not just growing, they’re growing really strongly. The failure here is by investors for buying into these ridiculous growth projections. Without mad projections you don’t get the funding, but with them you get investors who ultimately get burned.”