NBC's Zucker Sees Media Battle Waged on Two Fronts

(MoneyWatch)  Not to compare lost revenues to lost lives, but being in the media business these days has similarities to fighting wars simultaneously in Iraq and Afghanistan. That's the analogy that can be made from comments that NBC Universal CEO Jeff Zucker made yesterday at a panel on "The Future of New York City," where he described the pain the entire media industry is feeling in coping with a severe recession and a wrenching transition to digital all at the same time:

I think the problem is -- as we work our way from this analog world to this digital world -- there's a tremendous amount of pain, there's an enormous amount of lost revenues and in figuring that out, we're going through an unbelievable transition. So, the economic problems that we're all experiencing now on top of a tremendous transition is almost a double whammy through the entire media business. Nobody expected to be fighting both battles at the same time.

With all the headlines about the newspaper business' struggles, it's easy to forget that TV, though not slumping quite as badly, has its own set of very serious concerns about trying to stay afloat during an extreme economic downturn at the same time that the TV audience is increasingly embracing ways that digital media can change their viewing habits. DVRs and TiVo allow viewers to to time-shift and skip commercials -- TV's main source of revenue. Streaming video online is growing increasingly popular, but doesn't yet have a robust accompanying business model. There's even evidence to suggest that people are dropping their cable TV subscriptions because they can get a fair amount of the same content, for free, online.

As with fighting two wars, the most difficult challenge may be resources. In the case of NBC, for instance, the company announced it would cut 500 jobs in December, or three percent of the work force. Things are so bad on the local level that NBC Local recently said it would pool newsgathering with Fox in certain markets. At the same time, with less staff, the network has to put its content on more platforms, and figure out how to monetize them. For all media companies, It's going to be a protracted battle. (If you want to see more of Zucker's comments go to Adage.com.)