Skip to main content

Why Newspaper Advertising Model is Broken


According to the latest market assessment by eMarketer, the outlook for newspaper publishers in the U.S. is downright dismal. They estimate that American newspaper advertising revenues declined 16.4 percent in 2008 to $37.9 billion.

The forward-looking story is equally bad. By 2012, spending will slide to $28.4 billion.

"The current economic situation is making things tough across all media, but newspaper revenues are falling more than in any other major medium," says Carol Krol, eMarketer senior analyst. "Even the former bulwark of newspaper revenues, classified advertising, is plummeting due to Craigslist.com and other online alternatives."

The Newspaper Association of America tracked two consecutive quarters of declining revenues for newspapers online for Q2 and Q3 of 2008 -- the first time that has ever occurred since it began tracking online figures in 2003.

For 2008, eMarketer estimates online newspaper advertising revenues declined by 0.4 percent overall compared with 2007, to $3.2 billion, and forecasts they will drop further into negative territory in 2009, down 4.7 percent to $3 billion.

"The challenge for newspapers is continuing to make money while they transition to online," says Ms. Krol. "But they face the same transition problems that plague other traditional media, such as broadcast TV, and so far they have not been able to crack the code."

The "State of the News Media 2008" report, published by Pew Research Center, described the dilemma as a decoupling of news and advertising: More and more it appears the biggest problem facing traditional media has less to do with where people get information than how to pay for it -- the emerging reality is that advertising isn't migrating online with the consumer.

"It's like changing the oil in your car while you're driving down the freeway," Howard Weaver of McClatchy told Pew researchers. Clearly, that's a sobering analogy for investors who are hoping for any sign of an industry turn-around. Perhaps their advertising model is truly broken, and beyond repair.

Popular posts from this blog

Wireless Solutions Advance Work from Home Trends

Despite a challenging backdrop from the ongoing effects of the global COVID-19 pandemic, the negative impact on fifth-generation (5G) wireless supply chains has been minimal compared to the wider mobile smartphone market. This led to 5G mobile devices becoming more diverse, brought to market quickly at a variety of price points, thereby accelerating affordability and adoption. The mobile market is transitioning to 5G and many leading vendors are now exploring the low-priced 5G smartphone segment. According to the latest worldwide market study by ABI Research, 681 million 5G handsets will be shipped in 2022. Therefore, the race is on for OEMs to find that all-important level of differentiation in their flagship portfolios to help boost margins and improve market share. 5G Wireless Market Development Vendors continue to drive the adoption of new product designs, screen technology, chipsets, and camera setups -- notably within the flagship smartphone segment. Meanwhile, the leaders seek a

Software-Defined Infrastructure: The Platform of Choice

As more organizations adapt to a hybrid working model for their distributed workforce, enterprise CIOs and CTOs are tasked with delivering new productivity-enabling applications, while also seeking ways to effectively reduce IT cost, complexity, and risk. Traditional IT hardware infrastructure is evolving to more software-based solutions. The worldwide software-defined infrastructure (SDI) combined software market reached $12.17 billion during 2020 -- that's an increase of 5 percent over 2019, according to the latest market study by International Data Corporation (IDC). The market grew faster than other core IT technologies. The three technology pillars within the SDI market are: software-defined compute (53 percent of market value), software-defined storage controller (36 percent), and software-defined networking (11 percent). "Software-defined infrastructure solutions have long been popular for companies looking to eliminate cost, complexity, and risk within their data cente

Digital Identity Verification Market to Reach $16.7B

As more enterprise organizations embrace the ongoing transition to digital business transformation, CIOs and CTOs are adopting new technologies that enable the secure identification of individuals within their key stakeholder communities. A "digital identity" is a unique representation of a person. It enables individuals to prove their physical identity during transactions. Moreover, a digital identity is a set of validated digital attributes and credentials for online interactions -- similar to a person's identity within the physical world. Individuals can use a 'digital ID' to be verified through an authorized digital channel. Usually issued or regulated by a national ID scheme, a digital identity serves to identify a unique person online or offline. Digital Identity Systems Market Development Complementary to more traditional forms of identification, digital identity verification systems can enhance the authenticity, security, confidentiality, and efficiency of