News and the credit crunch
“Oh dear, more economic gloom”, says Jon Snow, rather glibly, in his daily ‘Snowmail’ briefing this evening. Today a major group of businesses have announced what some had feared, and even more already knew: that we’re heading towards a recession.
Banks aren’t lending, so people can’t borrow as much money, so they’re spending less, so businesses are earning less, while oil, food and energy prices continue to soar, meaning we have even less money…and so it goes on.
It’s bad news for a lot of people, but I’d thought it would be worth looking at its impact on the media industry.
Not that people should have much sympathy for an industry of overpaid, middle class trouble makers -but it is having an impact. First in the commercial sector, and today, we’re told, even on the mammoth BBC cash cow.
One industry I know is suffering – and has been one of the first to suffer – is commercial radio. High overheads need to be paid for by adverts. But when the companies can’t afford to pay for advertising….
So we’ve seen a raft of cost cutting measures across all areas. After buying out GCap, Global Radio decided to network on more than 30 stations, saving themselves the salaries of 30 presenters. Some journalism jobs are going too. Then one radio group The Local Radio Company sells six stations which are losing money – reportly flogging them for a pound each.
Commercial TV too is feeling the “pinch” and it’s local/regional output that’s suffering. Today we hear ITV is to completely scrap it’s nightly 30 minute news programmes, replacing them with a weekly current affairs programme instead. So goodbye local TV news.
There’s still lots of talk of “weathering the storm”, but I don’t think these changes are neccessarily temporary. The two examples above – of increased networking on radio, and the loss of daily local news on ITV – are permanent significant changes to how broadcasting is done in the UK.
Meanwhile over at the glittering palaces in White City, the BBC says even it’s tightening its belt. Speaking at a briefing this morning, the Director General Mark Thompson said inflation was “running significantly higher than [the level on which] the BBC’s [licence fee] settlement [was based]”. They’re already looking at cutting 2,500 jobs, although they said they hoped to avoid wider redundancies.
Even if we don’t have a recession, it looks like the media landscape in Britain will be changed forever anyway.