As Coronavirus Squeezes the Ad Industry, Local Publishers Are Feeling the Pain

“Before this public health crisis, most local news organizations were struggling with the massive disruption to their business models resulting from digital transformation. Now, a number of these local news organizations—both legacy ones and digital startups alike—are in even greater peril, with advertising and events revenue plummeting because of the coronavirus crisis,” Tim Franklin, senior associate dean and professor at Northwestern University’s Medill School of Journalism, told Adweek.

Publishers today face a similar challenge as they did during the 2008 financial crisis: the risk of lowering their advertising standards in search for short-term profits as the U.S. economy likely stares down a recession.

In 2008, publishers searching for revenue at time when advertising fell off a cliff lowered their standards on ads, causing a typhoon across the open web with ads promoting the likes of belly fat burners or get-rich-quick scams. Media companies may be forced to turn to the same tactics today.

Facebook said Monday that it will invest $100 million to help support the news industry during the coronavirus pandemic: $25 million in emergency grant funding for local news via its Facebook Journalism Project, and $75 million in additional market spending to help move money to news organizations globally.

Adweek's Ko Im brings us the view from South Korea.

Jon Cohen, co-founder and co-CEO of The Fader, told Adweek once SXSW was canceled and his team began to see the impact of coronavirus unfold, the company started brainstorming ways to help those in the music industry—from production and sound workers to stagehands and tour managers—who rely on Fader Fort and SXSW in general for income.

The Fader landed on the concept of a charitable, digital music festival to also bring together emerging acts slated to play Fader Fort this year, alongside artists who have performed at past editions.