Newspaper Ad Revenues Fall to 50-Year Low in 2011
mjperry.blogspot.com
mjperry.blogspot.com
The romance of the paper is just that. A thing of fiction, because in reality it is just voluntarily delivered spam.
(Snark aside, it's a good point-- there must be similar graphs for the ice or telegram industries, to name two. Could make a pretty cool art installation or something.)
If you ask me now, I'd say "Totally toast. Your children may recognize the names of a couple of them, if they happen to regularly visit one of a handful of niche websites."
Pick an industry you might think the US has largely abandoned to cheap foreign competition, like say textile manufacturing. Think all of our clothes are made in China? I'll bet you the US' textile manufacturing revenues graph looks substantially more favorable than that.
Did you expect the savvy ones to be more than 50% of the players? Only a minority of them will move successfully online, but they have no one to blame but themselves. This is common with most disruptions.
The trouble for newspapers is that they're used to having a certain scale and mode of operation. The future of news is small teams running a website with little of the ceremonious structure that defines a newspaper. As long as they're lean, they'll be able to take in enough revenue to keep writers living like writers mostly do today. But I don't think there's any way to squeeze the New York Times into that shape.
If you specifically mean war reporting, I don't know. I suspect some kind of nonprofit will spring up to fund reports on wars, but that's contingent on it actually being something any appreciable number of people value as much as it costs.
In fact, if you look at the curve from 1950-2000 you see it seems to approximately track the population growth from 1950, with a weird peak in ~1990 and trough a few years later. My hunch is that the previous state of the industry was that it reliably took in ~$130/yr/US resident (again, in current dollars) year after year. Now it takes in less than half that, and it's plummeting.
There's a successful business in there, just a much smaller one. In many ways, it's a return to the start of newspapers.
Well, here in Europe you're empirically being shown wrong. Local newspapers disappear the first; first step is that they're bought by a larger entity, second step is the removal of local news from them (because too expensive to write up), third step is killing them. Then, after a large brand has killed several smaller ones, they get bought by a bigger entity or go bankrupt.
I'm not sure how you can say that producing a local news story is cheap. It's very expensive on a per-reader count (which is all that matter) because there are relatively few readers. If you write a national story, you can sell it to everybody in the country. If you write a local story, you can only sell it to a subset of those people. Writing about a bake off costs the same as writing about a political debate on a national topic. It's quite obvious that writing for a small audience is a lot harder to have a positive ROI than for a large audience.
What we're starting to see is the rebirth of local community publications like non-profit donation supported pubs: http://www.newhavenindependent.org and http://www.texastribune.org.
We're also starting to see rapidly expanding for-profit groups like Community Impact. Who would have thought that relentlessly focusing on quality content would pay off?
It's often easier to get local advertisers to buy into the idea that they'll be targeting a local audience. Why wouldn't your bake-off article example be sponsored by the local grocery store or law firm? Which local advertiser wants to appear next to the national political debate article?
Small communities have been poorly served by local papers long before the Internet ate them.
Regional papers rely on wire services for national stories. Thus, it doesn't matter which newspaper you read, you'll probably be reading the AP's story. You might just as easily read the "really good" original article at The New York Times (it's only a Google search away). The regionals also cover a larger geographic area which means they're getting pinched on their truly local coverage. On an average day they'll have less relevant local content than the small local paper.
The other big disadvantage of regional newspapers is that advertisers don't want to effectively throw away their ad dollars spending to buy a region when they could buy a better targeted town or neighborhood. It's just less efficient for most types of businesses.
I would rather take out an ad in the Globe than in a bunch of smaller papers (one per town, but they are grouped under umbrella companies so it's not quite as bad as it sounds), but not if my prospects aren't going to read it.
Small regional papers may be better vectors for small regional businesses, but I would guess that Sears, Friday's and Pep Boys would also prefer to cover a larger area.
The 1950's seem to me like they would be a high point for newspapers (every book and movie set in those years has newspapers quite prominently, and wikipedia says that papers per person peaked in 1950). The years after that look like outliers actually, and now things are simply returning to normal.
But to make a true examination I would really like to see a graph going further back (to 1900, and even better to 1850), and I would like to see a graph adjusted per capita (per household, not person).
And although the rate of decline seems to be decreasing, it looks like they still haven't hit rock bottom yet. There's more pain to come.
SFgate.com, I am looking at you.
I know it's not exactly comparing apples to apples, but Private Eye in the UK still sells pretty well. I'm sure that if a newspaper marketed itself as high-brow, intellectual and most of all critical of itself and its own standards a lot of people would flock to it, as well as advertisers.
http://clubtroppo.com.au/2009/06/02/whats-killing-the-newspa...
The main source of revenue for newspapers isn't cover prices or even display advertising. It's classifieds. Until the internet came along, your local newspaper had a guaranteed cut of thousands of little transactions every single week.
Then craigslist and ebay and real estate websites and car sites and all their ilk proliferated. Now I can, often for free, advertise something small. That sucks the single biggest source of revenue directly out of newspapers.
And yes, I'm still working on that startup.