In December 2016, Jonah Peretti, the charismatic founder of the digital news and entertainment company BuzzFeed, penned his annual memo to his 1,400 staff. The memo outlined some of Peretti’s frustrations after that year’s US presidential election had revealed how much shoddy and misleading content was circulating online. His own news site had revealed some of the biggest stories in the “fake news” scandal that engulfed Facebook. But Peretti’s remedy was not regulation or chastisement of Facebook, but a concern that the old guard of so-called “legacy media” were also to blame.

“Media companies have been much too slow to shift to digital,” he wrote. “They’ve clung to print and broadcast, even when it was clear audiences are moving elsewhere. This means the budgets for quality journalism are focused on the wrong places, creating a void that is filled by the cheapest possible content, often from questionable sources.”

In New York City, in January 2019, it is brutally cold. Winter has arrived with savage consequences for digital publishers, including BuzzFeed. In the space of two weeks, about 2,100 jobs have been lost across the media, with many disappearing from purely digital publishers. BuzzFeed’s layoffs amounted to 15% of its total staff, a loss of around 220 jobs across all departments, including in its widely admired New York newsroom. On Friday, Vice, another media company once associated with fast growth, said it would lay off 10% of its workforce, while last month, the phone company Verizon, which owns Huffington Post and Yahoo, cut 800 workers in its media division. In the UK, the Pool, a website aimed at women launched in 2015 by radio presenter Lauren Laverne and magazine editor Sam Baker, went into liquidation, with 24 journalists facing redundancy.

Many of these layoffs played out in real time on Twitter as journalists reported on the fumbling and often ineptly cruel ways in which they were let go. Reporters at Vice knew of the layoffs and sometimes had their email accounts closed before being told by the company they were among the casualties.

Facebook Twitter Pinterest Ariann Huffington, founder of Huffington Post, whose parent company Verizon last month announced 800 job cuts in its media division. Photograph: Paul Morigi/Getty Images for Fortune

Job losses in the media are not unusual. In newspapers, particularly in the local and regional press in the US, the past decade has been catastrophic. Between 2008 and 2017, the number of newsroom jobs in US newspapers dropped by 45%, to 39,000, and all US newsroom jobs, including TV and radio, declined by 23% overall. Among the layoffs so far in 2019, newspaper companies McClatchy and Gannett have announced early retirement and redundancy rounds. But the polar vortex that has engulfed digital publishing, though relatively small by comparison, has left the industry, and journalists in particular, reeling. The long slow decline of newspapers has been well documented, as advertisers and readers have increasingly shifted their attention to digital platforms. But for the companies that were lauded for having understood the social web faster than legacy media to falter sends a signal too dire for many media companies to contemplate. Many of us are concluding that the commercial internet makes profitable journalism exponentially harder, and in many cases impossible.

Media consumption habits on the mobile social web have changed radically. Around 68% of adults in the US get at least some of their news from social media platforms, and the majority of those cite Facebook as the primary source. Facebook’s valuation is now above $470bn (£360bn). Google’s market value has risen from $200bn in 2012 to almost $800bn. Google and Facebook between them dominate the digital advertising market. In the same week that BuzzFeed announced its job losses, Facebook reported record revenues of almost $17bn for the last quarter of 2018. Despite a year of horrible publicity, from being blamed for contributing to genocide in Myanmar to a series of scandals around data and privacy, Facebook’s business appears as strong as ever.

Facebook Twitter Pinterest Sam Baker and Lauren Laverne, founders of The Pool, a website aimed at women, which closed on Friday. Photograph: Alicia Canter/The Guardian

The primary mistake most digital publishers made was to imagine that platform companies, and particularly Google and Facebook, had any serious interest in helping them sustain their businesses. The amount of data large platform companies collect and control enables them to offer far more efficient advertising than any publisher, and the business of making online content profitable is rigged against anyone who wants to run even a sparsely resourced newsroom with experienced reporters.

Peretti’s memo to staff after the layoffs was instructive about what would be needed to be sustainable: “We can build a profitable media businesses on top of Facebook and YouTube,” he writes, “but only when the content we make is high quality, with massive scale and relatively low production costs.”

Whatever this content might be it is unlikely to be in-depth investigative reporting, which is neither cheap to produce nor generally something that attracts “massive scale”. If BuzzFeed, Vice and other digital publishers who suffered despite a booming advertising market cannot make the social web work for them, it is likely that those who do will not be reliant on advertising.

It is also likely that this year’s job losses are merely the beginning of a new publishing depression. In regions such as the US, which has relied almost entirely on a free market to hold the powerful to account for the past 70 years, the lack of well-funded and abundant civic or public media is particularly sharply felt. In what seems like an attempt to apply a sticking plaster to an amputation, both Facebook and Google are now funding efforts at the local level to increase reporters and newsroom resources through schemes such as Report for America.

It was not the deliberate intention of Google, Facebook and Twitter to drain the advertising pool that supported journalism, but they did not particularly care whether publishers survived

Between them, the digital duopoly is spending $600m over the next three years on supporting journalism. But involvement of big tech in serious reporting is both ethically awkward and, so far, largely ineffective.

It was not the deliberate intention of Google, Facebook, Twitter and others to drain the advertising pool that supported journalism, but they did not particularly care whether publishers survived or failed. BuzzFeed had an almost symbiotic relationship with Facebook, collaborating on projects and helping it promote its tools to other publishers. However, reports suggest that after adjusting its algorithm to demote news, Facebook’s traffic to BuzzFeed and other publishers’ sites has dropped dramatically.

Vice to axe 250 staff in latest round of digital media job losses Read more

Plenty of people tout advice for what might work for news outlets, be it podcasts or newsletters, or having a very small niche audience, or the increasingly popular membership models or new types of subscription. And there are real examples of where different models are working, notably in non-profit and niche sectors. The New York Times and Washington Post (which operates under the protection of the billionaire Amazon founder Jeff Bezos) are large, well funded and have both been growing their newsrooms when others are shrinking. Both have seen success with charging readers subscriptions, but there are very few organisations that can replicate either their brands or their resources.

The future of journalism will generally be smaller and more challenging in the short term and remains uncertain in the long term. However, the problem now is so clear that even the most advanced digital thinkers can see it: a digital free market for journalism doesn’t work.

Emily Bell is professor of professional practice and director of the Tow Center at the Columbia Journalism School, New York