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WASHINGTON, May 29 (NEPS): A profound shift in the newspaper business model, evolving for years, is finally here.
Global newspaper circulation revenues are larger than newspaper advertising revenues for the first time this century, according to the annual World Press Trends survey released Monday by the World Association of Newspapers and News Publishers (WAN-IFRA).
“The basic assumption of the news business model — the subsidy that advertisers have long provided to news content — is gone,” said Larry Kilman, Secretary General of WAN-IFRA, who presented the survey at the 67th World Newspaper Congress, 22nd World Editors Forum and 25th World Advertising Forum in Washington, D.C. “We can freely say that audiences have become publishers’ biggest source of revenue.”
Newspapers generated an estimated US$179 billion in circulation and advertising revenue in 2014 — larger than the book publishing, music or film industries. Ninety-two billion dollars came from print and digital circulation, while 87 billion came from advertising, the survey said.
“This is a seismic shift from a strong business-to-business emphasis – publishers to advertisers – to a growing business-to-consumer emphasis, publishers to audiences,” said Mr. Kilman.
Throughout the 20th century, advertising brought up to 80 per cent of revenues in some markets. The ratio varies from market to market: in some European and Asian markets, advertising might bring 40 per cent of revenues.
But the survey showed that newspaper advertising revenues are falling nearly everywhere, while circulation revenues are relatively stable.
“Print used to be one of few traditional marketing channels and often the one that was the most ubiquitous for branding and logical choice for all marketers,” said Mr. Kilman. “This direct relationship of mutual dependence no longer exists. Advertisers nowadays have more than 60 different advertising media channels available to them.”
“However, in 2015 it is clear that the story of the newspaper industry is not one of doom and gloom and decline. Newspapers around the world are successfully proving their value to advertisers despite booming competition. They are discovering new markets and new business models that are today as pertinent to news production as advertising and circulation revenues. From print newspaper businesses, they have transformed into true multiplatform news media businesses.”
Though newspapers are now ubiquitous on all media platforms, the measure of their reach and influence continues to be mired in the 20th century, largely relying on print circulation and a variety of separate, non-standardized measures of digital reach. The challenge for the industry is to measure reach of newspaper content on all platforms with new metrics.
The World Press Trends survey includes data from more than 70 countries, accounting for more than 90 per cent of the global industry’s value. The data is compiled through an enormous undertaking by dozens of national newspaper and news media associations and generous support from global data suppliers: Zenith Optimedia, IPSOS, ComScore, the Pew Research Center, RAM, and the ITU.