WORLD PRESS TRENDS: Digital Revenues Won’t Replace Print

At no time in the foreseeable future will digital advertising revenues replace those lost to print, making the search for new business models — including paid-for-online access for news — a pressing concern for the news publishing industry, the World Association of Newspapers and News Publishers (WAN-IFRA) said in its annual world press trends update.

As search engines take the largest slice of Internet advertising revenues, little is left for the content generators themselves. In a 182-billion U.S. dollar press advertising industry, digital revenues of newspapers accounted for less than 6 billions dollars in 2008 and are forecast by PricewaterhouseCoopers to grow to no more than 8.4 billion dollars by 2013.

At the same time, print advertising is expected to decline. PwC predicts that by 2013, combined print and digital ad revenues will be less than print only ad revenues were in 2008.

"These PwC forecasts, similar to those made by Zenith Optimedia and others, demonstrate quite simply that at no time soon will digital advertising revenues come close to achieving the sort of revenues required, by many, to compensate for falling print revenue," said Timothy Balding, co-CEO of WAN-IFRA. "So that answer will have to be found elsewhere. ... Should these forecasts come close to being true, new business models will have to be invented."

"If newspaper companies wish to maintain their strong content leadership, someone is going to have to pay. It looks like we have to solve the digital payment issue - and soon," he said.

The annual world press trends survey was presented Tuesday (1 December) at the World Newspaper Congress and World Editors Forum in Hyderabad, India, where the paid content issue is being hotly debated.

The survey, presented to more than 900 publishers, chief editors, managing directors and other senior newspaper executives attending the Congress and Forum, was drawn primarily from data from WAN-IFRA’s World Press Trends and World Digital Media Trends surveys, and from data provided by Zenith Optimedia and PricewaterhouseCoopers.

Some of the highlights from the presentation:

-  Globally, 1.9 billion people choose to read a newspaper every day, or 34 percent of the world population, while 24 percent use the internet.

-  The biggest newspaper market in the world is India, with 107 million daily sales. India, China and Japan account for more than 60 percent of the world’s newspaper sales, with the USA taking 14 percent. "While it is true that in some regions circulations are not a boom sector, newspapers continue to be a global mass media to be reckoned with, achieving reach of over 34 percent," said Balding.

-  In terms of sales per 1,000 adult population, Japan leads the world with 612, followed by Norway with 576, and Finland with 482. In terms of reach, 91 percent of Japanese continue to read a newspaper daily - a remarkable figure in such a technologically advanced and wired society.

-  Advertising revenues fell an estimated 20 percent in North America, 19 percent in eastern Europe, 16 percent in western Europe, and 11 percent in the Asia Pacific in 2009, according to PwC.

-  The US market has been hardest hit, with advertising revenues in the third quarter of 2009 falling nearly 29 percent in print and nearly 17 percent on digital platforms over the same quarter in 200!. But revenue declines mirror declines in other industries. "While we have systemic challenges, while we transition from a print only model to new forms of publishing over time and that we can exercise control over, there still remains outside forces - namely the economy - that we have little control over," said Balding.

Click here for more.