Saturday, January 31, 2009
Et tu, EBay?
Unemployment is up again, companies one might have thought were solid are announcing layoffs, the LA Times announced layoffs today, and the Philadelphia Inquirer is reported to be flirting with Pa. Gov. Ed Rendell about a $10 million state bailout. (Presumably the only way to have a free and independent press in this country is to make it a ward of government.) But perhaps the most important signal that this recession is real and not likely to go away very soon is that EBay has announced a hefty year-to-year decline, with profit falling 31% from last year, the first decline since 1995 (which means it weathered the dot.com bubble-burst). We in the newspaper business, who have seen our revenues decline in large part because of migration to the Net, not only for news but advertising (Craigslist and Monster.com have hammered us; Register employment ad revenue was down 40% in 2008) had tended to see Net businesses as somehow all-powerful. (Incidentally, one of the best commentaries I've seen on the slow death of newspapers is this from Slate.com's Jack Shafer.) If EBay is seeing profits decline and laying people off, the recession is serious indeed.