Monday, August 31, 2009

Can newspaper publishers survive this revenue freefall? Perhaps, if they embrace a digital future.

Without the fanfare that accompanied the recent release of its online readership data, the NAA quietly posted last week its latest compilation of quarterly revenue data for U.S. daily newspapers, in a data set it has maintained for 50 years. The latest figures, for the second quarter, show an alarming drop of 30.15 percent in print revenue and 15.90 percent in online revenue versus the same period in 2008. Despite signs elsewhere that the recession may have bottomed out, these figures are even worse than the first quarter results (declines of 29.70 percent in print and 13.40 percent online).

Alan Mutter, the Newsosaur, analyzes these numbers by category and projects that for the full year 2009, combined print and online revenue will be “no more than $27 billion” — and worse if the economy doesn’t pick up — a drop of more nearly $11 billion from 2008’s $37.8 billion. My guess is slightly higher: print revenue of $25 billion; online revenue of $2.5 billion, total $27.5 billion — a drop of $10.3 billion.

How did this happen to an industry that in 2005 garnered record revenue of $49.4 billion ($47.4 billion of it in print)? By adjusting the historical numbers for inflation, as Mutter did, the industry is half the size it was in 1986, when it scored $52.3 billion in 2008 dollars. But that doesn’t paint the whole picture.

A better way to look at the historical revenue record is to place it in the context of total advertising expenditures across all U.S. media. I’ve done that, and here’s what it looks like:

Continue reading this post at Nieman Journalism Lab.


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