There’s lots of discussion about whether online video is going to be hit by the current economic downturn. Startups may be able to whether the storm a bit better than others – they’re not expected to make money right away, but the digital media industry as a whole is due for a shake out.
Recent funding for online video startups, contrary to how it has been spun in the blogosphere has been aimed at keeping companies with potential going, or was closed before the current economic situation became clear. A number of measurement firms have recently cut online ad spending forecasts, which will be particularly hurtful to the large number of long tail content creation and distribution companies.
Already, we have seen the beginning, here’s a not-so-short list, but we’re nowhere near the end. Today Jason Calacanis announced that despite the $20 million in cash Mahalo has raised, the company is laying off 10% of its staff. Belt tightening is the name of the game to outlast the recession.
Online video while it can be cheap has grown too fast, most content creation and new media distribution companies are spending too much money on too many staff members who aren’t pulling in enough money, and it’s either consolidate and find a way to start generating revenue fast, or die.
Wow- nice piece- especially the Mahalo story and Jason’s articles on depression.
the Economic Recession has been pretty hard on us. some of my friends lost their job because of the massive job cuts. i just hope that our economy becomes better in the following years.
the economic recession has been pretty hard on us. there is some good progress on the economy this year. i just hope that the economy will continue to recover in the following months and years.
i am hoping that the global economy would recover from this economic recession. life has been very hard with these massive job cuts.