Last year was the worst on record for the U.S. newspaper industry. Total advertising revenues (both print and online) declined 16.6 percent to $37.85 billion, according to the latest figures from the Newspaper Association of America. That is $7.5 billion less than in 2007. Print advertising alone declined 17.7. Classifieds were down 29.7 percent. And even online advertising was down 1.8 percent to $3.1 billion.
Newspapers are shuttering their print editions, laying off staff, or closing entirely as a result of this severe contraction in revenues brought on by the double whammy of economic recession and competition from the Web. Drilling down into the fourth quarter numbers, total advertising dollars shrank 19.74 percent, making it the tenth straight quarter in which revenues have declined, and the sixth straight quarter in which the rate of decline has been accelerating:
3Q07: -7.4%
4Q07: -10.3%
1Q08: -12.85%
2Q08: -15.11% 3
3Q08: -18.11%
4Q08: -19.74%
The rate of decline in online revenues also seems to be accelerating. .Online revenues were $778 million, which was 8 percent lower than the year before. The year-over-year decline was also greater than the 3 percent decline in the third quarter and the 2.4 percent decline in the second quarter (which was the first quarter when online ad revenues for the newspaper industry went down).
(Photo by Scott Glovsky).
The table below shows both online and total (print and online) advertising revenues for the newspaper industry for each quarter of last year. The “total” column below includes both online and print revenues
| Year | Quarter |
|
% Change |
|
% Change | |||
| 2008 | 1 | $804.05 | 7.20% | $9,229.53 | -12.85% | |||
| 2 | $776.58 | -2.40% | $9,601.64 | -15.11% | ||||
| 3 | $749.84 | -3.00% | $8,942.43 | -18.11% | ||||
| 4 | $778.27 | -8.10% | $10,074.65 | -19.74% | ||||
And here are figures for annual newspaper advertising revenues for the past five years. The newspaper industry is still huge, but the print portion is just getting decimated. Meanwhile online revenues still account for less than 10 percent of the total (8.3 percent, to be exact), and even those are facing challenges.
| Year | Online | % change | Total | % change |
| 2004 | $1,541 | 26.7% | $48,244 | 4.5% |
| 2005 | $2,027 | 31.5% | $49,435 | 2.5% |
| 2006 | $2,664 | 31.5% | $49,275 | -0.3% |
| 2007 | $3,166 | 18.8% | $45,375 | -7.9% |
| 2008 | $3,109 | -1.8% | $37,848 | -16.6% |
Maybe the newspaper industry should publish topless women, like Britain.
I don’t know if that would help.
http://finance....f-14718269.html
Bloggers like TC are happy. But there will be correction in online ads also, and fewer TechCrunch parties.
Newspapers are on decline, other than just correction. But when they launch newspapers +magazines +TVnewsChannel +internetPortal together with lot of synergy, bloggers will hit the dust.
@ Happy Bloggers – keep dreaming lol.
@Eric, Matter of time before newspaper people know the pulse of internet. Like RSS, SEO, organising/searching content etc.
Americans get it at home, so they don’t need to see it all over in public.
yeah, I meant that.
hopefully rupert will buy the dying print media seniors at a fire sale and give them a proper burial. owning the cemetary of print media can be legendary?
AdvertisingLocator.com – sell yourself
They’re already making money off porn but they can’t publish that, you see.
not a huge shocker. i’d be curious to know how the online numbers break out.
On line is ok but filled with advertisements. There is nothing like reading the ol newspaper.
You must be blind to the full page ads and annoying inserts…
At least online ads (and articles) are not printed on dead trees. You gotta love it when the newspapers print stories about environmental issues. Especially when each day their operations consume tons of paper, ink, and energy for printing, and door to door delivery.
This is one industry where the environmental issues have been 100% solved by technology. Yet there are those who still want to keep this industry alive despite it’s unsustainable business model. Do I sense another bailout coming on?
Hey, I might drive an SUV… but at least I don’t subscribe to the Times.
I like reading newspaper, same as how I like to shower daily and use AC on a warm day. What is your point?
“This is one industry where the environmental issues have been 100% solved by technology.”
I ‘m so happy at you having pointed that out …
Do you have a Paypal account ?
Alas online media does not in fact come carbon-free: see eg http://technolo...icle5489134.ece
On the bigger issue of declining advertising in print: at least in the UK the issue is that the print titles are failing to offer advertisers compelling integrated advertising packages. The strongest print brands in the UK are among the strongest media brands. Even though the share of their revenue from print is declining fast, companies like The Times and The Guardian would be fine if they took advantage of the fact that they reach people across two media.
Newspaper companies need to reinvent their business model similar to how Newscorp is doing. The advertising medium has changed drastically and I think the need to focus on acquisitions that can quickly aid them in transitioning to a new business model.
I’m curious how this free fall will trickle (down, up, across?) to the AP
And becae of this they will be coming after the internet. You have already seen them trying to start the conversation of more controls on the web.
Main stream media has lost as much money to the internet as they are going to. Look for them to try and make the web a pain in the ass.
Only a matter of time.
Good riddance.
In real estate matters, I tell my Sellers as early as the Listing Presentation that Printed Media is not a cost effective way to use anyone’s money. Not when the World Wide Web is your audience – printed media is too local and people can search and evaluate real estate better on a big glossy monitor. This is why I also offer free photography services to create virtual tours for Sellers I work for. The “Times” have-a-changed.
It sure seems like the judgment day is near. Soon we get to see who can really hang their Harvard business degrees on the wall and who should hide in shame for calling themselves an entrepreneur.
I stopped buying newspapers because they were so often – and obviously – politically biased. I’m not talking about supporting positions I don’t like. I can handle that, no problem. I mean completely ignoring and/or misrepresenting the OTHER positions. That I don’t like and won’t give them my money for. I suspect many people no longer see value in paying for what amounts to propaganda for one party or another.
That and also the fact that you could get the same story covered by more competent writers online for free.
Also, 9/11 has changed the way people perceive media, especially new york times. Imagine a single paper responsible for the onset of a war and fueling lies and distortion rooted in personal interests. Just the thought of it makes you want to take a shower.
“… fueling lies and distortion rooted in personal interests …” –and political bias…
Every major newspaper in the US has been doing exactly that for many years.
Their circulation is falling? I really like that. It is a natural market correction, of course, helped by the stupidity of their managers. They have ignored their readers, their *paying* customers, for a long time.
Newspaper publishing is like any other business: ignore your customers at your own risk.
For instance, the NY Times [followed by The Washington Post now] –Marc Andreessen was correct on the Charlie Rose show while talking about the [bleeding millions] NY Times print edition: “shut it down now.”
I stopped buying newspapers about 5 years ago…
I totally agree. In the build up to the 2003 Iraq war, the New York Times published a number of stories claiming to prove that Iraq possessed WMD.
http://theglobe...aditional-media
The newspaper industry is full of self-promoting people whose IQ is less than 40. The sooner it fails, the happier I am.
I am in complete agreement with Steve. Meaningfula ttempts at objectivity and fairness would be a unique selling proposition at this point, which is sad and more than a little scary. I can get an echo chamber anywhere for free.
Loosing the Rocky Mountain News was like loosing an old friend. It is dearly missed.
@Kitty – Would you donate money to keep it alive? I don’t think so…
Small newspapers are going out of business every day all over the US, being replaced by local blogs… we have to keep pace with progress.
This is not really news at this point. Newspapers have been failing for some time now, are failing and will be failing for some time to come (it takes a while to kill an industry this big and previously wealthy).
What would be news:
1. If one of them figured out how to survive.
2. If anyone knew what it took for any of them to survive.
Meanwhile I guess we’ll just chart the descent…
The scope is larger than the newspaper industry. It’s really about all those companies out there relying on ad revenue alone.
Considering the number of business that have no real way of making money but solely depend on ad revenue, the upcoming years will be harsh. I am already predicting humanitarian efforts along the lines of “Feed an entrepreneur, click here”.
The future of printed media as we see it–> http://www.hota...t.com/press.php
“Print 2.0″ tells you all you need to know – this company, like the newspaper industry, does not *get* it.
People will not be coming back in droves to print. The people that say “i don’t know, I like to have paper in my hand” are dying every day and very soon now the only people left will be those raised on twitter.
The newspaper industry need no longer hold out for people / advertisers to come back to print, nor should they hop on every dumb Internet trend of the moment. They need to control content distribution, and that’s something they cannot wrap their brains around.
Sadly, they need to realize that the demand for 12 inches of copy to tell a simple story is no longer wanted or efficient. And if the online components are making 10% of what the print side is, the hard truth is is it’s time to start dumping the print product while it still has some marginal value.
You probably didn’t read the whole article, did you?
“Print 2.0″ is just an allegory for the next stage of printed media. Got it?
I read the whole thing. Your company will suck in a few newspapers with the “2.0″ talk but ultimately does nothing to address the immediate issues the industry is facing.
The newspapers are being hit from all sides, ad revs are down, breaking news/content is online, and it’s free.
I for one do not need a newspaper, cant remember the last time I read one. I get all the content I need from the comfort of my iphone,
How can the papers change there business model?
They cant; newspapers are dying a death of a thousand cuts. The industry is dead.
Blame it on the pirates like some other industries do.
I’m wondering if there’s a breakdown available for different newspapers. It’ll be interesting to compare popular ones vs. local ones.
- Aanarav
congress wants to give them a bailout too…can you imagine… if the government owns the press what happens to “freedom of the press”
let’m die and let the new generation take over; all we’re doing is trying to prolong the 20th century…and it’s bankrupting america for no good reason except to keep the retards working for nothing.
“… congress wants to give them a bailout too…can you imagine …” They may, using our hard earned dollars.
But this insane tax and spend will stop, sooner than we can imagine… There is a fast growing movement of American citizens named after the historic Boston Tea Party, to get rid of our “brilliant” representatives in Congress at election time in November 2010.
Visit this site for more info: http://www.OrlandoTeaParty.com
It is up to us to decide the future of our country. Think about this…
Using the word “lost” is misleading. Everyone but the newspaper industry knew there was no money there. It never existed — therefore, not lost.
This is racist !!!
Bres,
Do you identify yourself with a pongid looking for an easy fruit?
LOL. Yes Aristotle !!!
And I got this way after having to attend the 3rd Diversity Training in 7 years. In Diversity Training, they teach us to scream racism when we have nothing useful to say. That’s the cool thing about alleging racism: you still get credit regardless of whether there is rhyme or reason behind the allegation.
Loss of revenues is not the whole story — that alone should not have been enough to bring the house of cards down. Total 2008 newspaper revenue is roughly what it was in 1994, and newspapers were in much better shape then. What’s different? UNNECESSARY CONSOLIDATION. To buy more and more newspapers, the large media conglomerates have had to assume a very large amount of debt. For example, let us take the Chicago Tribune. Sam Zell bought TribuneCo with $8.2B in leveraged debt. That debt is not free, it must be serviced at considerable cost. And it is not “good debt” — it served no real business purpose other than to change ownership of the paper to Sam Zell. These leveraged debts PLUS the downturn in revenue are what are killing the newspaper industry.
Consolidation at times like this can be a silver bullet. Look at Oracle with it’s acquisitions of PeopleSoft, JD Edwards, Siebel, BEA and Primavera. If you look at their quarter results they would have felt short by 6% but thanks to the revenue streams, primarily in the support of the existing licenses, they pulled an amazing 3% gain.
During recession periods, it is to be expected that sales of new products and services will drop. Consolidating in a way that exchanges cash on hand with some steady revenue for the years to come is smart.
the consolidation yaknet was talking about did not take place during a recession. it took place at the top of the market…thus the big problems.
while the internet has played a major factor, cable news has played at least as big of a factor.
Being employed in the newspaper business, I’m fortunate to be part of a private company (American City Business Journals) that continues to do well and is profitable. The St. Louis Business Journal is the #2 business journals out of 41 nationally and we had a record year in 2008. 2009 is proving to be a bit more challenging but we are hanging tough.
Check out this interesting article:
Do Some Good: Create Newspaper Ads
http://adage.co...ticle_id=135535
As soon as the newspapers stopped being the primary source of advertising for home delivery to the web, the printed newspaper was doomed. It really doesn’t make any difference how good or bad the content is. Newspapers have always been supported pretty much by advertising, not what you actually pay when you buy one.
We need a way to pay for journalism. I’m not talking about what most blogs are on about. There is a difference.
I’m talking about long-term journalists, working beats, actually following the traditional rules about verifying sources, and having to prove to an editor that the story is worthwhile.
(And yes, some news organizations that know better have broken those rules.)
There are a few blogs out there that seem to be working towards good journalism. Will there be enough money in it to support them professionally?
I ran into this website for the first time this weekend: http://www.stlbeacon.org/ . This gives me hope for the future. I also notice the connection to public broadcasting in this website. This raises the question about possibly being the need for an PBS/NPR-like funding (without CPB) method for the on-line press?
Actually, NPR is doing a good job with their web presence these days in terms of news creation and distribution.
Very slick. Should we expect a rick rolling when we click on your link?
Didn’t we read about this on readwriteweb last friday? Eh.
and the ad on internet will also drop, right?
Yo, so the ad rates are down and stuff ? How is hommie supposed to get enough dough to get his new rims? Damn man, I be stayin at a different tech venue with my peeps. This ain’t payin.
Erick, please feel free to deadpool the entire print industry. Those numbers are terrible.
Newspapers will still be around for a long time to come. Take Hong Kong as an example. Mobile penetration rates are around the highest in the world, 3G is old hat and mobile data plans are relatively cheap. And yet there is a thriving free newspaper business. ‘The Standard’ went free and increased both revenue and circulation (you can’t beat free).
Yes some newspapers are biased, but there are precious few web resources that are not.
Love the Standard in HK, read it every day on MTR to work. Papers still have a great niche for people looking to do something, get informed, while generally passing the time, ie commute, having a beer, etc.
Stick a fork in ‘em…..they’re done. Everyone’s migrating online…..and many of the papers are too late.
eeeeeeeeeeeeeeeeeeeeeeeeee <—–That was a flat line.
How you like them apples Drama 2.0 Show!
Gloating, are you?
It’s the fault of Silicon Valley and the California Ideology, telling the newspapers that they had to publish for free, and that “information wants to be free”.
We are now seeing that when you make information free, nobody gets paid, not even for online ads, and then information dies.
Are you ready to admit you were wrong yet?
Why would anyone invest in newspapers? Killing trees to distribute outdated information is so 20th century. In 3 years most of the newspapers in America will be gone.
I sent my local paper’s editor a nice letter asking him to consider a new model where they covered local news and local news only.
It’s pointless to cover any world stuff since it is all over the web for free. I would hope they also ditch all the cheesy home style wire stories they run.
They would get a big chunk of the local advertising back, except for classifieds which Craigslist owns.
I got no reply, not surprising really since I am sure they get lots of cranky emails.
I feel though they would rather die than change.
May be the newspapers should try to get into AMAZON’S kindle?
just a thought!
The death of the physical newspaper is close
Whilst print and fixed online decline, mobile online is increasing significantly – its true the currently the rise in mobile does not match the print/fixed online decline in absolute terms but percentage increases in mobile are significant. Additionally a further billion people are coming online via mobile in the next 4 years. To make advertising money through mobile requires large numbers of readers and a better targeting from the advertising industry but its all coming together. There is hope for content owners to make money, they just need to plan to close their presses in 5 years or so.
May be the newspapers should try to get into AMAZON’S kindle?
That’s huge really huge indeed..
The problem with the newspaper industry goes well beyond the issues pointed out in the comments above. As someone that has been working with the newspaper industry for well over a year now on possible technology solutions that could solve their problems, it is clear that the problems stem from two sources:
1 – Management that is STILL opposed to anything new or different
2 – Disparate, non-top down management decision processes to implement new solutions.
Take RSS. It took newspapers YEARS to implement RSS out of fear that people wouldn’t come to their site to read the news, only to later realize that RSS brings their stories to the far corners of the web only to bring MORE people back to their site. Unfortunately, for many it was too late.
My company offers a solution that lets users create a customized newspaper featuring stories from the newspaper but ALSO from other sources. Countless research (and common sense) has indicated that today’s over-exposed reader wants their news from one place, sports another, finance another – yet newspapers are STILL trying to force you to drink the koolaid all from THEIR sources only. What happens? Reader decide to go to MyYahoo, iGoogle or anywhere else they can get multiple sources of news. It’s amazing.
For the industry to change they need to embrace this multi-source news culture we live in and provide tools that ALLOW for it instead of trying to fight it. Of course I’m biased but I have $7.5B in lost revenue that further supports the hundreds of other pieces of research and studies done. Besides, you don’t come to TC to read about financial or local news do you?
It’s really sad to see all of these businesses losing money. I hope they come up with ways to be more techie so they can save money.
Mohammad Afaq
Free
Website Traffic
I still find it funny that the WSJ requires you to be a paying member to leave comments on their stories. You would think Newscorp a Co. that gets it would in fact “Get It” but I guess old habits are hard to kick.
The Washington Post nornally republishes TechCrunch content but did not republish this…I wonder why? http://www.wash...8050701103.html
As it should be. The newspaper is dead. Why would I want a product that:
a) is harmful to the environment
b) is awkward to even use correctly due its size and ink rubbing off on my hands
c) is inferior in terms of quality
d) is less focused in terms of what I’m interested in
e) is pricey (i.e. not free) compared to alternatives
f) is not easily shared
g) has no easy feedback mechanism
I can only speak on a few subjects on which I’d consider myself an expert, but the blogs that I read contain content that is SO VASTLY SUPERIOR to anything I have ever read in a major newspaper, it’s absurd. Entire (hugely popular) blogs exist soley to point out the ridiculous stories that are written by mainstream journalists.
Why should newspapers survive at all? To me, this is in some ways similar to, say, LPs vs. CDs:
CDs are more convenient, of higher quality, smaller, etc.
And then add in the fact that blogs are (usually free), have better content, etc. – is it any wonder that this is happening?
The smart journalists will start (or join) blogs and make money off the advertising there. Maybe some are good enough writers to start writing books.
The ones that are hacks will find something else to do.
And yet my right wing racist and fascist local newspaper is still going strong? Damn it!!!!!!!!
Flip the Script … {seesmic_video:{”url_thumbnail”:{”value”:”http://t.seesmic.com/thumbnail/6Z1CyXM5yW_th1.jpg”}”title”:{”value”:”Flip the Script … ”}”videoUri”:{”value”:”http://www.seesmic.com/video/nd3zzQ8hpS”}}}
The printing press has widely acknowkedged to have over spent on investigative journalism, too may reporters overlapping with agencies and companies around the world. The current decline suggests a contraction in the industry to major brands, and centralized news coming more from online feeds, with more focused IJ work. More online news will be aggregated like Alltop.com and papers will eventually thin to the few. Advertising will switch in the next 3-5 years.
Good information.
In the present economic situation if you are looking to get your message across to people and advertising your business without spending loads of money, then you can opt for traditional outlets like print advertising agencies. These agencies can offer you classified ad space at special discounts. This is also a great opportunity especially if you are setting up a new business or are tight on your advertising budget.
When you use a professional ad agency, you tend to receive an early notice of the special offers and prices and also a considerable reduction in the advertising rate for national press. So help your business grow by promoting it in the low priced publications. Use print media to cut your costs and boost your advertising efforts in this growing economic recession.
Goodbye newspapers…?
In Italy the first signals of an incoming crisis can be traced in the recent problems which invested “Il Manifesto” and “La Repubblica” (La crisi dell’editoria che viene da lontano).
Is the crisis a consequence of economic ever worsening situation or can just be attributed to the new ways of circulating news offered by internet?
Thanks to the diffusion of more and more fast connections and the wide spread of internet all web users can access instantly every kind of news and informations. And moreover this can be done for free, at least from the user’s point of view. The real market is behind the scenes: the huge and intricated world of advertising which is migrating from paper press to its web equivalent. The reader can get informations without paying anything and, at least apparently, the choice and availability of news is much greater. Moreover internet offers an interactive approach not available through standard newspaper.
The advantages seem many….which are the drawbacks?
One possible drawback could be found in the web organization itself maybe, intrinsic in all internet facilities. While reading an article the reader finds (almost stubs its toe on) a great amount of links one after the other. This is the web with its hypertext structure. It offers new hints and open one’s own point of view but can also divert from a complete, relaxing and focused reading.
The new freedom offered by the web always depends on our own intelligent usage. For the standard reader the kind of fruition offered by the web is more difficult than the one offered earlier on the traditional papers. Maybe…
The interactiveness may indicate more freedom of expression but also more ways to be deceived.
Who is now the warrantor of the news?
The users can’t make directly the questions to all degrees of people at all levels. This is the task of professional journalists and reporters and this is the reason why I hope a way of cohabitation of classical and new media will be reached.
I’ve been thinking about the plight of newspapers. It’s all on my blog http://www.work...-do-to-survive/
The Toy Lounge of St. Paul MN – http://thetoylo....com/newspapers – creates custom iPhone apps for newspapers, magazines and other publications. Newspapers are tanking these dats, but few want to spend the relatively minor $15000-$20000 or more that it takes to make a decent basic newspaper iPhone app.
The new iPhone 3.0 upgrade will allow newspapers to do some nice innovative things through their iPhone apps, like offer premium content for extra revenue, connect to a newspaper’s online store (sacrilege?) sell subscriptions, stream video, and much more.
A forward thinking newspaper would be getting started on the app process right away. Use a custom iPhone app as a stepping stone to widest possible utilization of the whole mobile space.
Sorry, by “dats” I mean “days” – dat’s what happens when the copy editors have all been let go!
A couple of observations to modify your piece.
First, the NAA series include only daily newspapers. Weeklies, alternative newsweeklies and specialized newspapers are not included.
The Census Bureau prepares a quarterly report of newspaper revenue estimates. The final report for 2008 shows a $5.6 billion revenue loss by the entire industry.
The NAA series show the cost of newspaper advertising to the advertiser including payments to non-newspaper ad services companies. Those payments to others are substantial, 35%-40% of thenumbers shown by NAA.
NAA is concerned with market share; financial analysts should be concerned with revenue received.