March 14, 2011

Online News Consumption and Advertising Revenue Surpass Print


Is it possible we are moving to a whole new platform in terms of content consumption? While digital offered a new playing field, did many believe that we would move so strongly in this direction as to eliminate the need for print options?

While we may not have arrived at complete elimination of one over the other, a Reuters (News - Alert) report does suggest that for the first time ever, online readership and advertising revenue has surpassed that of print newspapers.

In the United States, online advertising revenue was projected to overtake print newspaper ad revenue in 2010. This projection was issued in the State of the News Media report from the Pew (News - Alert) Research Center’s Project for Excellence in Journalism.

According to this study, 46 percent of Americans reported that they get their news online at least three times a week. By contrast, 40 percent reported they get their news from newspapers and their companion websites.

Tom Rosenstiel, director of the Project for Excellence in Journalism, shared that the migration to the Web is certainly accelerating. Adding to that is the quick adoption of the tablet computer and the proliferation of the smartphone.

The findings in this report suggest that newspapers suffered as a result of the economic downturn when advertisers cut back spending, as well as people choosing to find their news online. Information and advertisers are also following this trend.

Declines in revenue in advertising sales have been reported by newspaper companies such as Gannet, The New York Times and McClatchy. Other media, such as television, however, are enjoying a rebound in ad sales and the recovery in getting underway.

The report suggested that newspaper ad revenue in 2010 fell as much as 46 percent from 2006 to roughly $22.8 billion. Online advertising also fell $3 billion to land at $25.8 billion.

The study noted that the challenge for news organizations is that much of this online ad spending – as much as 48 percent – is in search advertising. Such revenues do not tend to finance news, which hurts the industry.

Newspapers definitely felt the impact over the last 10 years as newsrooms have become 30 percent smaller. As they move to online provisions, many still have to charge for this access, contrary to the typical online model. The report did find, however, that 23 percent of Americans would pay $5 a month for an online version of their local newspaper, if they could no longer get it in print.


Susan J. Campbell is a contributing editor for TMCnet and has also written for eastbiz.com. To read more of Susan’s articles, please visit her columnist page.

Edited by Tammy Wolf
TechZone360
Twitter

FOLLOW TECHZONE360


EDITOR'S CHOICE


WHAT'S HOT @ TECHZONE360



Featured Magazines - Subscribe for FREE


Featured Events