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Ad revenues at newspapers: More bad news

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Conditions at American newspapers are going to worsen, and there’s a billion reasons why.

Because of incompetent or inept or unimaginative top management scared silly by Wall Street profit expectations, you can hardly recognize newspapers any more.

Newspapers have physically shrunk. They’re narrower and not as deep. That means less space for news despite protestations to the contrary and “smart business decisions” such as front-page ads and he-said, she-said arguments about the future of news.

Staffs in all departments of newspapers have decreased through layoffs and attrition. All this means less credible news as fewer people do more work, as reporters with less time use fewer sources — sometimes just one — or lean more heavily on “anonymice.”

You know why. The current business model in the news biz says: “Maintain profit margin” because Wall Street demands it. But advertising revenue — the money coming in — is decreasing. Therefore expenses — the money going out — must decrease. Ergo: Cut the size of the paper. Cut the size of the staff. “Enhance” the Internet presence. Sacrifice a necessary role in how a democracy functions and blame Craigslist.

Well, folks, don’t count on better things ahead for newspapers, because they can’t afford it (or so they say.)

Reports the Associated Press:

Advertising revenues at newspapers fell 8.6 percent in the April-to-June period of this year, as an accelerating decline in print ads more than outweighed gains in online advertising, an industry group reported Friday.

The Newspaper Association of America, ever eager to put a nice gloss on this, says newspaper revenue from online advertising increased by 19.3 percent to $796 million in the second quarter over a year ago.
But print-only revenue is falling faster and in larger amounts than online-only revenue is climbing. Reports the AP:

Print-only advertising at newspapers slumped 10.2 percent to $10.5 billion in the second quarter of the year, marking the fifth consecutive quarter of declines …

In other words, newspapers made about a billion dollars less on print ads in that quarter than the same period a year ago.

If you’re dreaming of better newspapers; more accurate newspapers; newspapers that are delivered in rural areas instead of just central cities; newspapers that cover international news; newspapers that actually run reviews of books, music, culture and art; newspapers that follow state and regional news as closely as they follow local news; newspapers that cover business with consumers and workers in mind rather than just CEOs and “the markets”; newspapers that run locally written editorials about local issues instead of buying edits on bland issues from syndicates; newspapers that demand accountability at all levels of government; newspapers that run more stories written by their staffs than from wire services … then keep dreaming.

They can’t afford it, because the execs at the top are unwilling to sacrifice more of their shrinking but substantial 17 percent profit margin — still greater than any other American industry — to reinvest in and reinvigorate their product to compete more effectively with other news and information venues.

Perhaps next year, top executives will reduce the size of the newspaper to a thin paperback book — like the ones we read in grade school. Hey, papers that small will be easy to carry, and newspapers will save more money on newsprint.

xpost: Scholars & Rogues

Written by Dr. Denny Wilkins

September 3, 2007 at 5:45 pm

Posted in Uncategorized

One Response

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  1. … i like this library .. it’s quiet here.
    My daughter recently joined a booming European media company. They provide topical inserts into Sunday editions. They are also responsible for selling their own advertising. The newspaper simply becomes an empty, paper envelope delivering someone else’s content to the reader.
    hey .. this is wonderful library .. i like the color of the walls and all this quiet is so soothing.


    September 8, 2007 at 6:23 pm

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