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Posted by: Jon Fine on May 15, 2009
People are still paying for the print newspaper. In fact, in almost all cases, people are paying more for the print newspaper: circulation revenues rose, if slightly, at almost all of the remaining publicly traded newspaper companies in the first three months of this year:
McClatchy: circulation rev up 0.9% to $68.5 million
New York Times Co.: circulation revnue up 1%, to $228.9 million
Lee Enterprises: circulation revenue down 4.1%, to $47.1 million
AH Belo: circulation revenue up 8.9%, to $31.7 million
Media General: circulation revenue up 6.2%
Gannett: US circulation revenue up 1%. (These revenues at UK properties were down, and pushed company’s total circulation revenue down 3.1%.)
E.W. Scripps: circulation revenue up 0.4% to $30.6 million.
In dollars, this means little for these companies when ad revenues—which generally make up 80%, or more, of total US newspaper revenue each year—are down more than 20%, and, in some cases, down more than 30%.
It's more illuminating when it comes to the psychology of newspaper readers, by which I mean "people who read a printed newspaper." Overall newspaper circulation declined 7% for the six months ending March 31. Thus, much of these companies' gains are coming from increased prices.
That tiny bit of pricing power indicates there’s a still a decent tie with consumers, which persisted even when backdropped by many newspaper companies declaring bankruptcy and a steep economic turndown. Lots of places that make their money from consumer spending did not show single-digit revenue growth in the first three months of 2009. (Of course, lots of places sell products that cost more than a daily newspaper.)
So, yes, even today, there remains some tenacity in readers’ attachment to print newspapers. If you’re wildly optimistic, you might extrapolate from this data that a decent percentage of readers will tolerate some sort of online pricing to read newspaper content.
Or it might mean that a portion of the readership will still pay up for the physical newspaper,
I’m not wildly optimistic, so my money’s on option #2. Still, that’s something. It ain’t gonna save newspapers, but it’s something.
The media, entertainment and marketing worlds continue to shapeshift on a near-daily basis, as new forms arise and old assumptions erode. Where is it all going? No one really knows. But on this blog BusinessWeek’s media writers Tom Lowry and Ron Grover promise to provide ample helpings of scoop, provocation, and sharp analysis as they track and annotate this constantly changing terrain.