Blog Network Gawker Cuts Staff; Google Optimizes Blog Search

(MoneyWatch)  One down, one up.

As media stocks in general, and newspaper stocks in particular, continued their downward spiral in yet another day of market volatility, a gloomy sense is settling over the entire media industry. Forecasts for advertising revenue have been reduced, and some companies have announced new rounds of job cuts as a result.

Furthermore, the trouble is no longer confined to newspapers and other "old media" firms. One of the best known blogging networks, Gawker Media, announced 19 layoffs, or one-seventh of its total editorial staff, due to signs of softening in online advertising revenue.

The company stated in an internal memo "...the credit crisis is clearly going to affect every sector of the economy. Advertising buys typically plunge after the Christmas shopping season, and 2009 is obviously going to be exceptionally difficult. We have to prepare for the worst, now, rather than when the worst comes upon us."

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So that was some bad news. On to the good.

I've noted before that Google launches more new products than anyone could be reasonably expected to keep up with, but one recent move caught my eye, and that is a new blog search technology meant to sniff out "news" from the blogosphere.

The search giant crawls some 900,000 blog entries daily and now is taking steps to catregorize them into clusters of politics, technology, business, science, sports, entertainment, movies and television. It also graphs how specific news stories rise and fall over time.

Testing it earlier today, I easily located a recent blog post of mine by searching under two keywords in the title of the post plus a third keyword that appeared in the first paragraph of the entry. In fact, it showed up as the number one result on the new Google blog search. That's one way to impress a skeptic!