Lately TechCrunch has been following the effects of the economic crisis on the technology sector quite closely. Michael Arrington and his crew have been providing us with updates of the mounting numbers of tech layoffs and failing tech companies for the past month or so. Just the other day Erick Schonfeld wrote that technology related layoffs had surged past 100,000.
With so many tech layoffs and web based start-ups failing, I wondered if tech related news sites themselves may be affected. Do you think these sorts of things affect reader interest or is the tech news industry impervious to everyone else’s economic woes? My gut says that people are always going to want to follow the news and, while the current economic situation isn’t looking too great, it wouldn’t affect website traffic. Yet it also seems like there’s been less startup announcements on TechCrunch and other startup news sites lately and I’ve noticed that some have been posting more list- and hack-like postings to fill-in the gaps. Thus perhaps, in part, less startup announcements diminish traffic by removing the media buzz that’s created by the startups, which there are less of, and the workers themselves, which have also been reduced due to all the layoffs. Furthermore, if your tech news site’s central focus is internet start-ups then I would expect it to take a greater hit in traffic versus those that cover a broader spectrum of technology related news. While this all sounds like pure speculation, I have included the actual traffic stats from Compete so you can check them out and decide for yourself.
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Figure 1. November Traffic Analytics For TechCrunch, AlleyInsider, ReadWriteWeb, Arstechnica, and VentureBeat |
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Figure 2. November Traffic Analytics For GigaOM, TechMeme, Slashdot, KillerStartups, and StartupMeme |
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Figure 3. November Traffic Analytics For TechDirt, Engadget, DownloadSquad, ValleyWag, and TradeVibes Just another example of technology related websites experiencing declines in web traffic for the month of November |
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Figure 4. November Traffic Analytics For Wired, Mashable, Lifehacker, Lifehack, and Gizmodo |
Okay, so not everyone is experiencing the a reduction in monthly unique visitors and those that are seeing a drop in traffic aren’t affected to the same degree. Why isn’t there a more broad effect? Well, perhaps technology related sites that cover a broader range of topics are able to diversify their interests enough to defend against such vulnerabilities. We can see this for example in Wired (+22.1%), Digg (+4.6%), and CNET (+8.7%). Also, there are some tech related niche topics that appear to not be affected at all. Indeed, it seems that productivity and DIY focused sites like Lifehack, Lifehacker, and DumbLittleMan (14.8%) all grew in unique visitor traffic for the month of November.
So if there is indeed a downward trend of less readers logging on to visit these type of websites, what’s the reason? Is it because the economic decline of the tech market has yielded less startups and therefore there is less exciting news to be covered or is it because niche readers in this industry are turned off to such interests after being laid off themselves? Perhaps a simpler explanation is that laid off workers and everyone else throughout the entire U.S., regardless of their profession and online reading interests, are tightening up their wallets and dropping their ISP by choice or necessity. Another possibility is that web traffic for November is usually low anyway. Figures 5 and 6 below indicate that neither such scenario is likely given that 8 of the top 10 most popular websites in the U.S. demonstrated an increase in unique visitors for the past month.
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Figure 5. November Traffic Stats For Google, Yahoo, MSN, Live, and eBay |
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Figure 6. November Traffic Statistics For YouTube, Amazon, Wikipedia, MySpace, and AOL |
Thus it does seem at least plausible that TechCrunch and other similar tech news sites, which put more of a focused effort into covering new internet startups, may be more susceptible to a loss in traffic if there are reductions in the total number of startups launching over a period of time.
It is interesting to note, however, that TechCrunch’s own network sites, TechCrunchIT (-14.3%), CrunchBase (-18.6%), and MobileCrunch (0.0%) are all experiencing either a loss in traffic or no gains at all. Meanwhile CrunchGear saw a 7.9% increase in the number of unique visitors for the same month.
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My guess is that people are spending more time online performing shopping related activities instead of reading tech news. The fact that crunch gear traffic is up supports that idea. The fact that all of the tech news sites have strong year over year increases shows that tech news is becoming more popular. I think tech news is recession proof because it helps people identify market trends and product innovations; even if those market trends are dire and product innovations are limited. Opportunities continue to spring up during recessions.
Twitter/Share/BookmarkI’d say that your probably right that people maybe spending more time online shopping this time of the year. Indeed Amazon’s traffic was up 14.7% this past November and it saw similar increases in November of 2007 as well. It’s not cut and dry though. CrunchGear and Gizmodo both saw increased uniques, but not Engadget’s which was down by ~6%.
I agree with you that tech news in general is not affected so much. However, I don’t think the same is true with niche tech (i.e. startups only).