Wall St. Reports Print Media’s Darkest Hours
Friday, August 10, 2018
Not since the “Great Recession” has the print media in the United States seen such a collapse in print revenue. The difference today is that this is a dynamic and growing economy, and overall media spending is increasing.
Print revenue is collapsing and traditional media companies are trying to pivot to digital revenue -- only a very few are having any success.
The implication for news gathering in local communities in Rhode Island and across the country is devastating.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTAs second-quarter revenue numbers came in from a range of publicly traded media groups, print revenue is plummeting.
Gannett, owners of USA Today and hundreds of community newspapers across the country saw tumbling revenues tied to its print operations.
“Overall publishing operating revenues were $644.6 million, down from $692.2 million in second quarter 2017, while print advertising revenue plummeted by 19.1% from the first quarter. Circulation revenue fell by 5% from the same quarter last year, with increases seen by the company’s full-access subscriber pricing initiatives offset by single copy revenue declines,” reports Media Post.
In Rhode Island — More Staff Loses
For the Providence Journal and Newport Daily News’ parent company, the overall revenues increased due to its continued acquisition and consolidation strategy. In Rhode Island, New Media Investment Group which operates GateHouse Media that owns the two Rhode Island papers, reported that, “traditional Print Advertising declined 13.3% in Q2 as opposed to 12.3% in Q1.”
“Traditional Print revenues were $159.2 million and decreased 13.3% on an organic same-store basis. Within this category, Preprints were down 18.2%, Classified Print was down 12.1% and Local Print Advertising was down 11.7%. All of those are on an organic same-store basis,” according to the recent quarterly investor call. The company operates in more than 570 small to mid-sized communities across the country.
The implications continue to be felt in Rhode Island. As recently reported by GoLocal, the Providence Journal lost four senior reporters and editors to staff reductions. Executive Editor Alan Rosenberg confirmed that John Hill, Christine Dunn, John Gillooly, and night editor Gary Zebrun took buyouts. In Newport, two journalists left the Daily News via buyouts — photographer Dave Hansen and reporter Matt Sheley.
Overall, six fewer journalists in Rhode Island.
"Legacy media are in a generational tailspin. No one under the age of 40 is reading newsprint anymore and traditional newsrooms including The Providence Journal and The Boston Globe have failed at presenting news online... and the results are apparent," said Roger Williams Journalism Professor Michael Scully in an interview with GoLocal two weeks ago.
"So, as the whole media ecosystem realigns itself, and news revenues dry up, legacy newsrooms continue to implode. What will local news look like in five years? Who knows. There will be digital operations but I doubt The Providence Journal and/or The Newport Daily News will be viable news resources. They are the Sears and J.C. Penney of the news world," said Scully.
Columbia Journalism Review's recent study finds that the remaining papers are reporting less and less original local journalism. "We found, for instance, that of the 100 randomly chosen communities across the US that we analyzed, a full 20 of them received no local news stories in the seven days that we analyzed. Twelve communities received no original stories during this time period; and eight received no stories addressing a critical information need. On average, in terms of the news stories produced for the communities in our sample, 44 percent of the stories were original; only 17 percent were local; and 56 percent addressed what we call a critical information need—they provided hard news or information in the public interest, as opposed to soft news like celebrity gossip."
The numbers were consistent across all the major print media groups -- print revenue collapsing and digital media increasing -- but few saw the digital increase coming close to generating enough revenue to off-set the falling print numbers. The aberration was the New York Times.
“The company said on Wednesday that revenue from digital subscriptions rose to $99 million in the second quarter, a jump of nearly 20 percent compared with the same period a year ago. Overall for the second quarter, total revenue increased 2 percent, to $415 million, and the company reported a profit of almost $24 million. The Times now has 2.9 million digital-only subscribers, out of 3.8 million total,” reported the Times.
But, the loss of print revenue hit the Times hard too. “Even with the rise in digital subscriptions, the company had a 10 percent decline in advertising revenue, with digital advertising revenue falling 7.5 percent, to $51 million. Print advertising revenue decreased in the second quarter of the year by 11.5 percent, to $68 million.”
Magazines Hit Hard
According to a major report on the state of the magazine industry in WWD.com, “Reported magazine ad spending by the 50 biggest advertisers last year fell to $6.1 billion from $6.5 billion in 2016, according to AMM’s annual report. So magazines lost at least $417.5 million in revenue last year.”
“Overall, there are very few major magazine brands managing to pull strong through the digital shift. Of the 114 magazine brands tracked by AMM, 56 titles, or 50 percent, have a total audience in decline year-to-date. Print and digital editions are faring even worse, with 74 titles, or 64 percent of magazines, seeing audience on the decline.”
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