The Economist, 07/13/2013
IN ITS offices on the Tietê river, Editora Abril, a sprawling publishing empire, displays its 53 glossy titles across the wall like a winning hand of cards. But the hand is about to shrink. Roberto Civita, Abril’s boss, died in May, catching the family-run firm off guard. Already facing declining revenues, last month Abril announced it would fire a handful of senior editors and merge its ten publishing divisions into five. Analysts speculate that at least ten loss-making magazines and as many as 1,000 editorial jobs may be axed in the next few months. “The building is trembling,” says one marketing executive.
Abril is not alone. In June the Folha de São Paulo, the country’s largest daily, sacked 24 staff, 6% of the total. Its rival, O Estado de São Paulo, has been hit, too. After the death in May of its director, Ruy Mesquita, the paper cut 50 jobs. Its sister paper, the Jornal da Tarde, which stood up to the military dictatorship that ran from 1964-85, folded last year. The crisis is reckoned to have claimed 280 jobs in São Paulo alone this year. “We’re in the middle of a storm,” says Jayme Sirotsky, a former president of the World Association of Newspapers. “Everyone is trying to produce quality news content and still stay profitable in a hostile environment.”
These are familiar woes. Demographic upheaval, economic downturn and technology are ravaging publishers in Brazil as they are in the rich world. As 40m Brazilians left poverty in the past decade, publishers banked on a fresh wave of print subscribers. In the end, the new middle class went online instead: nearly half of all homes now have an internet connection.