The news business faces a reckoning in 2024

January 18, 2024

Source: AXIOS

Written by: Sara Fischer

A new report saying billionaire Patrick Soon-Shiong has sunk hundreds of millions of his own money into an unprofitable Los Angeles Times underscores how desperate the news industry is to chart a plan for survival in the digital era.

Why it matters: If billionaire owners can’t make the L.A. Times or the Washington Post profitable, then the news industry has to ask itself: What can?

Driving the news: A former top editor estimates the L.A. Times is losing $50 million a year, The Wrap reports.

Soon-Shiong has said in meetings that he had put nearly $1 billion into the L.A. Times: He paid $500 million for the paper and related assets, and has had to spend an estimated $300 million in additional cash over the last five years, according to The Wrap.
The Washington Post was set to lose $100 million last year.

The big picture: Every news company is trying to dig out of this hole — even ones that are still minting money.

That includes CNN, where new CEO Mark Thompson unveiled his strategy in a memo Wednesday that carried the rallying cry: “We need to organize around the future not the past. We need to recapture some of the swagger and innovation of the early CNN.”
“CNN of today is no longer that buccaneering outsider but a tenured incumbent,” Thompson acknowledged.

“Like so many other news players with a broadcast heritage, CNN’s linear services and even its website can sometimes have an old-fashioned and unadventurous feel as if the world has changed and they haven’t.”

Be smart: “Only legacy media organizations use the word ‘digital,'” Thompson added.

“In start-ups and in Silicon Valley it doesn’t need to be said because it’s so central and so obvious. At CNN we also want to move as quickly as possible to a point where it becomes redundant.”

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