Wednesday, September 02, 2009
Newspaper Ad Revenue Plummets Nearly 50% in 9 Years
Newspaper ad revenue has dropped from a high of $48.7 billion in 2000 to $34.7 billion in 2008. The news for the first half of 2009 is even worse--nearly doubling the decline of the first two quarters of 2008.
Advertising revenue is down about 30% in the first two quarters of 2009. If a similar drop continues in the last two quarters of 2009 (which happened in 2006, 2007 and 2008), the 2009 ad total could drop to $25 billion. That would be just shy of a 50% drop in ad revenue between 2000 and 2009. Factoring in inflation could bring the 2009 actual ad revenue value down to only 42% of ad revenue received in 2000.
Significant drops in subscribers (the Oregonian lost 11% of its subscribers this last year), the recession, and a host of new media advertising venues (like company web sites) is bad news for newspaper ad income.
New media is faster, easier and cheaper for the reader to access. The same story often appears a day or two later in the local newspaper and as such is at best redundant if not actually superseded by newer reports.
New media also gives access to original sources (especially official reports) as well as a host of secondary sources. That means that readers are able to fact check journalists and spot bias or incompetence. Unfortunately, both have become much too common in newspaper reporting.
The pluses of new media combined with the flaws in current newspaper reporting leave a reading public not much interested in subscribing to newspapers and advertisers paying significantly less to newspapers for access to their diminishing reader base.
McClatchy Watch has two excellent postings and links (here and here) on the importance of the drop in ad revenue to newspapers.