The boom of the 2000s met the inevitable decline of 2008, followed by a political atmosphere that was hostile to independent journalism.

What caused India’s news media to become an elaborate PR machine for the government and corporates? It’s the economy, stupid.

Let me unpack this a bit by comparing two numbers from the Centre for Monitoring Indian Economy’s monthly employment data. Five years ago, in September 2016, there were about 10.3 lakh people working in India’s media and publishing industry. In August 2021, it dropped to 2.3 lakh.

That’s a whopping 78 percent drop in media and publishing jobs. Effectively, four out of every five media employees have either lost their jobs or have left the profession. And no, it is not because of Covid. The biggest collapse of these jobs took place between January and December 2018.

If one takes a three-month average of employment in media and publishing, we find that there were about 8.3 lakh jobs between January and March 2018. That dropped to an average of 3.7 lakh jobs between October and December 2018. That means 56 percent of those working in this industry lost their jobs or left it, within the span of just one year.

Of course, CMIE’s data is about media in general and not just news media. But anecdotal evidence tells us that the trend was worse in news. The reason for this is not political. Even the most pro-Modi news organisations have had to downsize because they ran out of money.

The seeds of this collapse were planted in the early 2000s, when stock markets were booming across the world. Media companies wanted to make the most of it by listing their shares on the bourses. By the mid-2000s, media stocks were on fire. Brokerages had dedicated analysts who tracked media companies. Promoters were being advised by investment bankers to expand and diversify, to increase the valuation of their companies.

Within the companies, there was a sense of euphoria and a hunger to quickly maximise value. As the media business was flooded with funds, employers could offer top dollar to poach – or retain – their key talents. News media salaries went through the roof and editors and top anchors began to earn what their peers in the corporate world were getting. Senior journalists were flying their families in business class and holidaying in five-star resorts. They drove the latest Audis and bought multi-crore homes.

All this was happening without any commensurate increase in advertising revenues. News companies were almost entirely running their operations with money they had raised from the markets or through stake sales. Some companies began to make strategic investments in unrelated businesses. As late as 2012, one big media house had “private treaties” with over 350 companies where they accepted shares in exchange for advertising.

Even journalists were being paid a part of their salary in employee stock ownership plans, or ESOPs. Narratives were being built in every newsroom about how wealth will be “unlocked” as their companies expanded into entertainment and sports broadcasting. Many companies were planning to “demerge” individual channels and list them separately to “unlock value”.

And then 2008 happened.

The global financial crisis that began in the US caused stock market crashes across the world. Money escaped to safe havens and investors began to seek earnings. Every bloated stock – media, power, infrastructure – that was based on promises of “future” earnings got decimated, quite literally: several media stocks dropped to one-tenth their peak price in the space of one year.

The first round of media retrenchments and salary cuts began around 2009-10. Newsrooms started to shed flab and become “efficient”. Bench-strength was reduced sharply, HR consultants were hired to suggest ways to increase productivity and cut costs. News was now to be produced for consumers living in the key advertising markets. If the reader or viewer was in Delhi or Mumbai, then news was going to be about what interested them. Many companies shut down bureaus which were not considered important for the news “market”.

For several years, news companies tried various ways to cut costs, without actively sacking people. News-gathering budgets were slashed, and newsrooms turned to agencies, like PTI and ANI, for routine coverage. The same soundbites collected by ANI began appearing on every channel, and stories in newspapers often went with an “agency copy” byline. Companies followed an invisible downsizing policy by not filling posts that had become vacant after people left their jobs.

As news channels moved away from ground reports and investigations, loud chat shows took over. This was very inexpensive TV. All you needed was an anchor and a few guests and an incendiary, polarising topic. What made it even more attractive was that this kind of news entertainment attracted a much wider, albeit mostly male, audience. Channels that became studio-centric got more viewership, and consequently got more ads. This was a vicious cycle which made journalists increasingly redundant.

However, despite this winning formula, news organisations weren’t really making big money. GroupM’s estimates suggest that ad spends on TV channels grew by an average of 11 percent per year between 2012-19. Ad spends on print grew by just one percent per year. While legacy print companies didn’t have much debt, TV news channels were sinking in it. Given their low earnings and the high net debt on their books, listed TV news companies needed much better earnings growth than they could show to their investors.

This is what caused the second big round of retrenchments in 2018. By then, all hopes of an economic recovery were dashed. Managements in media houses decided to contract and survive, instead of trying to expand. If there were any investments, they were in the digital side of the business. Since new hires in the digital space had never seen the fabulous salaries of the 2000s, they could be paid less. In a sense, digital media could be sustainable right from the beginning because it didn’t have the legacy costs of the boom period.

In the midst of a political atmosphere that was increasingly becoming hostile to independent journalism, news organisations decided that the only way to survive was to become cheerleaders of the government. Editors, anchors and journalists who were critical of the government were slowly eased out. Those who were willing to bat for the government were promoted and given primetime slots. Reporters were directed to do certain kinds of stories and lay off those that could embarrass those in power. Pressure came from advertisers as well, who did not want to associate themselves with anything that criticised government policies.

Behind all this, big corporates were taking over media houses. Reliance Industries, the Aditya Birla Group, and others were buying out promoters or acquiring significant stakes in news companies. A few exemplary sackings here and there sent a message to others that they should either fall in line, or exit.

Older journalists in these mainstream media companies are now mostly jaded. They treat journalism as just any other job. A young crop has also emerged, poorly trained and poorly paid. They have no exposure to journalistic ethics and are willing to do anything to be in the good books of their editors. Everyone knows any dissent can cost them their job.