July 11, 2023

Today's Media Trends, copy edited by Sheryl Miller, is 1,917 words, a 7-minute read. Sign up.

⚽ Situational awareness: The New York Times plans to cut its stand-alone sports desk to focus more on its subscription sports site The Athletic. It follows sweeping changes made by the Los Angeles Times to its print sports section and a slew of high-profile layoffs at ESPN.

📅 Today at 11:45am ET: I'm sharing a few key takeaways about the state of the media industry. Zoom link here.

1 big thing: LAT crosses 500K digital subs

Executive editor Kevin Merida. Photo illustration: Annelise Capossela/Axios. Photo: Teresa Kroeger/Getty Images

The Los Angeles Times on Monday launched De Los, a new brand focused on identity and culture targeted to English-speaking Gen Z and millennial Latinos in the U.S., executive editor Kevin Merida told Axios.

Why it matters: The platform is part of a broader effort to engage younger audiences as the storied paper looks to add more digital subscriptions.

By the numbers: Currently, the paper has 550,000 digital subscriptions, including those that come from third-party apps, like Apple News+, Merida said.

  • That's up from 450,000 digital subscriptions reported in early 2022 and over 250,000 in late 2020.

Details: De Los will offer a mix of commentary, comics, social media videos and eventually community events from voices within the Los Angeles Times' newsroom and from external contributors whose audiences the Times hopes to tap into.

  • The brand is colorful, urban and youthful, featuring videos and graphics from reporters behind the scenes at local events.
  • "It's certainly going to be a community-driven platform and brand," Merida told Axios. "It's part of the Los Angeles Times, but it should have an independent, authentic feel to it."
  • Delta is serving as a launch sponsor, and California Endowment is joining as a community funder this fall. Merida said the Times is also "actively pursuing additional advertising funding" and will eventually look to develop subscription models.

Be smart: Merida, who came to the Times in May 2021 from ESPN and the Washington Post before that, has been tasked with bringing more inclusivity to the paper, amid frustrations among the Latino community over a lack of representation.

  • Today, Merida says, 20% of the paper's newsroom is Latino, up from 13% in 2020. A quarter of the masthead, he added, is Latino, and the newsroom overall is 48% journalists of color.

Yes, but: The paper is far from its owner Patrick Soon-Shiong's stated goal of reaching 1 million digital-only subscribers by the end of 2022. And it hasn't been immune from the financial headwinds facing the media industry.

  • Last month, Merida said the paper would cut 74 newsroom positions.
  • Nineteen of those impacted were reportedly Latino.

Merida acknowledged the cuts, calling them "painful," but he said that "the fact that layoffs impacted journalists of color, Latinos, is in some ways, a byproduct of how diverse of a newsroom we are."

What's next: The company still isn't profitable, but Merida said he is optimistic about the paper's prospects, given how much more closely the revenue and editorial sides are working together to build long-term revenue models.

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2. 🗞️ Meanwhile, San Diego Union-Tribune sold

Photo: Sandy Huffaker/Getty Images

The Los Angeles Times' sister paper has sold to MediaNews Group, a local newspaper company owned by hedge fund Alden Global Capital, for an undisclosed amount, I report with Axios' Andrew Keatts.

Why it matters: The deal strengthens MediaNews Group's foothold in Southern California.

  • The company, which is home to hundreds of weekly newspapers and dozens of daily newspapers, operates a subsidiary called the Southern California News Group, which includes papers such as the Orange County Register and Los Angeles Daily News.

Details: In a statement to Los Angeles Times staffers obtained by Axios, Patrick Soon-Shiong — a biotech billionaire who bought the Times and Union-Tribune for $500 million in 2018 — said he sold the Union-Tribune to focus efforts on the Los Angeles Times.

  • "Our hometown of Los Angeles and the state of California — really, the West Coast — needs a strong, independent news organization. We believe in the L.A. Times and are committed to its future," he said.

What to watch: Layoffs are likely.

  • In a memo to Union-Tribune staffers, a MediaNews Group executive said, "Reductions will be necessary to offset the slowdown in revenues as economic headwinds continue to impact the media industry."

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  • 📧 Sign up for Axios San Diego, launching later this month.

3. 🧵Scoop: Branded content coming to Threads

Illustration: Brendan Lynch/Axios

Instagram is planning to bring its branded content tools to Threads, a source told Axios, giving marketers a way to get involved with paid promotion on the app while advertising is still off limits, Axios' Eleanor Hawkins and I write.

Why it matters: Companies see a clear advantage in being a first-mover on Threads, but with the rules around paid promotion in flux, it's unclear the best way to get involved beyond creating organic posts.

State of play: Instagram's terms of service, which includes guidance around sponsored content, applies to Threads.

  • That means brands that work with influencers to post sponsored content are technically required to use Instagram's branded content tools.
  • Instagram's branded content tools, which allow companies to add paid partnership labels to their posts, are only made available to eligible brands.

Be smart: Those tools aren't currently available on Threads. But a source told Axios that Instagram is working to quickly make them available, which would give marketers an opportunity to begin experimenting with paid promotion, while advertising is still unavailable.

  • Threads won't introduce ads until its user base reaches a critical mass, a Meta source told Axios.
  • In the interim, the guidance being offered to brands is to clearly disclose any paid partnerships through text or hashtags until Threads gets its branded content tools up and running.

The big picture: Threads has been adopted faster than any online service to date, far surpassing even ChatGPT, Axios' Ina Fried writes. But it still has a lot of catching up to do when it comes to features.

  • Case in point: Threads has not yet rolled out chronological feeds, which makes real-time announcements from news, sports and local governments less reliable.

What to watch: Instagram head Adam Mosseri said Threads will try to avoid courting news and politics content creators because those topics aren't worth the scrutiny and integrity risks that come along with policing them.

  • That makes Threads more of a brand-safe bet for marketers, but it's unclear how the app, which is centered around text-based conversations, plans to remain hyper-relevant without that type of timely content.
  • For now, most major companies have already set up accounts on Threads, and many have already begun posting content organically.

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4. Meta's long history of copycats

Meta's <span style="color: #086ABF">launches</span> and <span style="color: #FF4E1F">shutdowns</span> of apps and features
Data: Axios Reporting; Chart: Jared Whalen/Axios

Meta's new Twitter copycat app may seem like an attempt to undercut Elon Musk while he's down, but it's also a continuation of the company's long-standing "clone and conquer" product strategy.

Why it matters: Most of the time, Meta's copycat experiments have failed. But a small number of cloned or acquired features that have worked out, like its TikTok copycat Reels and its Snapchat copycat Stories, have paid off handsomely.

💭 My thought bubble: Meta has a deep history of launching apps and features mimicking its rivals' offerings, only to shut them down after a few months. But Threads seems poised to stick around.

  • Most copycat apps or features launched by Meta that have shuttered lasted less than two years, and they never cracked more than 1 million users.
  • The ones that did garner big audiences, like Boomerang and Layout, were eventually adopted as full-time features within Instagram.
  • With 100 million users in less than a week, Threads has so far grown faster than both of those stand-alone apps.

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5. News comments disappear

Illustration: Annelise Capossela/Axios

MediaNews Group, the local newspaper company owned by Alden Global Capital, has shut down all of its comment sections as of July 1, due to difficulties in moderating them, executives told Axios.

Why it matters: Comments were a staple of early internet blogging, but professional news websites have reeled them in to prevent spam, abuse and harassment.

Details: In a statement, MediaNews Group executive editor Frank Pine said all MediaNews Group publications removed the commenting widgets from their sites on July 1 because “open comments can be difficult to moderate, and the discussion can sometimes be overwhelmed by spam, vicious political feuding, or even worse, hate speech.”

  • While Pine acknowledged that many readers enjoy engaging with comments, he said that they can often become polarizing.

The big picture: Many news outlets have removed comments in recent years as online discourse becomes more polarizing and harder to police.

  • Gannett, one of the largest national newspaper chains, ended comments on most of its news articles earlier this year, citing difficulties in its ability to allocate enough staffers to adequately moderate them.
  • The Philadelphia Inquirer removed comments in 2021 arguing, "The comments on far too many Inquirer.com stories are toxic, and have gotten worse as mounting extremism and election denialism pollute our national discourse. Our staff and readers deserve better."

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6. 🍿 Barbie-Oppenheimer doubleheader looks to revive summer slump

Photos: Warner Bros., Universal Pictures

Around 20,000 of AMC's "Stubs" insider rewards members are planning to see both Warner Bros.' "Barbie" and Universal Pictures' "Oppenheimer" this weekend, per the Hollywood Reporter, a testament to the anticipation of both films as the summer box office continues to lag.

Why it matters: The theater industry's hopes of a return to summer box office glory have not been realized as many expensive releases underperform, Axios' Tim Baysinger writes.

Data: Box Office Mojo; Chart: Axios Visuals
Data: Box Office Mojo; Chart: Axios Visuals

By the numbers: This year is still pacing ahead of last year, but the pace has slowed since Memorial Day.

  • Before Memorial Day, this year's box office was ahead of last year's by 22%. That lead has since shrunk to 16% as of last Friday.

Zoom in: The lower-than-expected box office totals are particularly worrisome for Cineworld. The world's second-largest theater owner was betting on a strong summer movie season to jump-start its post-bankruptcy life.

What to watch: Early tracking data suggests Barbie is on pace to cruise past Oppenheimer this weekend.

Go deeper: Barbie marketing mania

  • 📧 Sign up for Axios Pro Media Deals authored by Tim Baysinger and Kerry Flynn.

7. Momentum flows to B2B media

Illustration: Gabriella Turrisi/Axios

Amid a slowed advertising market, more news companies are focusing on professional audiences that can deliver more reliable, and often recurring, revenues around events, subscriptions and sponsorships.

Driving the news: Falfurrias Capital Partners, the North Carolina-based private equity firm that formerly held a majority stake in business media company Industry Dive, has acquired a majority stake in Executive Platforms, an events company that hosts forums for business executives.

  • The investment will be used to grow Executive Platforms’ editorial business around its events.

Why it matters: Typically, media companies launch the other way around, focusing first on editorial and then launching events around that expertise.

  • But as traditional advertising dollars become harder to attract, the lines between news and networking are getting blurry.

Details: “They were always interested in getting into the in-person event space. And we were always interested in the research and newsletter side of the business,” said Ted Stefanidis, director of Executive Platforms.

  • The company, he said, is eyeing various deals to help build out its editorial business, which could include products like newsletters and podcasts, as well as research and executive training programs.
  • Editorial products, he noted, will help the firm maintain its relationships with conference attendees between events while offering value.

Between the lines: Executive Platforms hosts niche events for high-level professionals in sectors like technology, manufacturing and pharmaceuticals.

  • The firm brings in roughly $20 million in revenue annually and is profitable. Deal terms were not disclosed.

The big picture: More media companies are launching with a focus on niche, professional audiences that are willing to pay for targeted events and subscriptions. Those audiences also tend to attract lucrative industry advertising dollars.

  • PunchBowl News, launched in January 2021, focuses on Congress and attracts advocacy advertisers.
  • Payload, founded in September 2020, serves space policy and investment professionals.
  • The Ankler, launched in 2022, focuses on Hollywood and entertainment, and attracts "for your consideration" awards advertisers.
  • Blockworks, founded in 2018, specializes in crypto news and attracts financial services and technology advertisers.