Newspapers fall short with digital revenue

“There’s no doubt we’re going out of business right now.”
-unnamed news exec, speaking to the Project for Excellence in Journalism

Newspapers aren’t out of the woods yet. There weren’t as many layoffs in 2011 as in, say, 2009, but newspapers still have a difficult time drawing in revenue from their digital offerings. A new study by the Pew Research Center’s Project for Excellence in Journalism explores how newspapers are doing in their efforts to build digital revenue. The results are grim.

While some papers have seen digital revenue grow, many have seen stagnant or negative growth. In general, for every seven dollars lost in print revenue, papers make just one dollar with digital advertising. Many newspapers have devoted resources to create Groupon-like deals sites and other non-traditional revenue models. These coupon programs have grown, but still bring in only 5% of digital revenue.

The study points out a few factors that may explain this poor performance. There are three times more print-focused salespeople at the papers studied than digital salespeople. There is a conflict between people trying to innovate at papers and the entrenched legacy of traditional newspaper revenue and reporting models. And newspapers don’t have resources to experiment with non-traditional revenue streams.

The study’s long, but well worth a read if you’re interested in the future of newspapers.

(via Nieman Journalism Lab)

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