Home » Big Publishing » Free-fall: Adjusted for inflation, print newspaper advertising revenue in 2012 was lower than in 1950

Free-fall: Adjusted for inflation, print newspaper advertising revenue in 2012 was lower than in 1950

9 April 2013

In another publishing industry, print revenues are falling.

From AEIdeas:

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The Newspaper Association of America (NAA) released its annual report today on American newspaper revenue, and the chart above displays updated advertising revenue data from the report through 2012.

The blue line in the chart above shows the total annual print newspaper advertising revenue(for the three categories national, retail, and classified) based on annual data from 1950 to 2012. The annual advertising revenues have been adjusted for inflation using the CPI, and appear in the chart as billions of constant 2012 dollars. Newspaper print advertising revenues of $18.9 billion in 2012 fell to the lowest annual level of print advertising since the NAA started tracking industry data in 1950. In 2012 dollars, advertising revenues last year were below the $19.75 billion spent in 1950, 62 years ago.

The decline in print newspaper advertising to a 62-year low is amazing by itself, but the sharp decline in recent years is pretty stunning. Print ad revenues fell by almost 50% in just the last four years, from $37 billion in 2008 to less than $19 billion last year; and by 66% over the last decade, from $56.3 billion in 2002.

Link to the rest at AEIdeas

PG says that nobody likes to see the employees of these organizations harmed. However, for those who insist that printed books will always be the predominant medium for distributing and consuming long-form writing, there is much conflicting evidence.

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14 Comments to “Free-fall: Adjusted for inflation, print newspaper advertising revenue in 2012 was lower than in 1950”

  1. As a newspaper employee, I can tell you that the decline in the industry pretty well mirrors the decline in ad revenues. We are all doing more work with fewer people, which, despite productivity gains produced by technological improvements, means that we all know that what we put out there is not always what we wish it could be. In many areas of the country, if it weren’t for underpaid journalism school grads there would be no paper at all. After 2 or 3 years most move on to a job that will pay the rent.

    As much as I love long form journalism, if it doesn’t remain a paying proposition (in one form or another), eventually it will die out.

  2. I’m going to admit to ignorance here – is journalism moving on-line? To ad supported sites?

    Print is going, but surely the need for journalism is not.

    • Sorry Mira,
      most online journalism is unpaid/underpaid. There are very (very very) few online sites that actually pay their people a living wage with benefits. Even sites like Huffpo uses a lot of unpaid bloggers, low wage interns and fresh grads who aren’t paid enough. Other sites rely on freelancers paid pennies a word. These sites themselves are rarely profitable. Monetizing the web is turning out to be more difficult that thought.

      Long form journalism, investigative journalism and their relatives are intended to inform the public debate, hold our public leaders to account and engage the reader in public discourse. This type of writing takes time. It takes effort. It can’t be done sitting behind a desk, on a phone, or surfing the web.

      Of course my original point was that our newspapers are doing less and less of this as well. Many journalists my age are just chucking it all and getting jobs in corporate communications, PR or government. It’s the only place where we can get paid a living wage.

      I would not advise any child of mine to attend journalism school. It’s a dying industry, going the way of the buggy whip.

      • @ Peggy – that’s really sad. I hope a solution is found – we need journalists!

      • Since the invention of the World Wide Web there has been a lot of hype about monetizing web content. However all the morcopayment, paywalls and subscription ideas the various companies have tried have ended up failing.
        Amazon, with $0.99 ebooks and it’s near friction-less system for selling them has come closest to the holy grail.
        I remember some time ago hearing about “Amazon Singles” specially for long form journalism, but I do not know how successful this was.
        I did a quick check on amazon and the first few titles on the amazon singles best sellers list had reasonably hime sales rank. So someone is buying them.

  3. This is interesting to me. Adjusted for inflation, it’s lower than it was in 1950. But looking at the graph above it doesn’t look *that* much lower. So this is where my ignorance and lack of math skills come into play…

    If you’re adjusting for inflation, that means that you’re converting the value of currency at one point in time into the value of currency at another point in time… so the newspaper business is not what it was, revenue-wise, twenty years ago. But it is equivalent to what it was *seventy* years ago…

    … when newspapers *weren’t* considered in decline. In the 50s newspapers were probably the most important information source out there, because the evening news was only for an hour each night.

    So I actually don’t understand this comparison. I think I get the point they’re trying to make, but what it actually looks like to me is that newspaper revenue has fallen to a point in time when newspapers were considered healthy, profitable institutions.

    • I think part of the problem is that ownership of these newspapers has changed in the last 60 years. Back in the 1950s, most newspapers were owned by individuals or families who would look at a 60%+ drop in revenue & say, “Well, we’re still running a profit, so let’s keep the course & see what happens.” Now the vast majority of newspapers are owned by corporations, which aim to improve earnings each year; a 60%+ drop in revenue means they have to cut costs somewhere, & since the conventional wisdom is that labor is the biggest expense for any business…

      The fact that there are fewer newspapers now than in the 1950s doesn’t change the thinking of the corporate types who manage by spreadsheet. The bottom line is the bottom line.

      • Back in the 1950s, most newspapers were owned by individuals or families who would look at a 60%+ drop in revenue & say, “Well, we’re still running a profit, so let’s keep the course & see what happens.”

        The only businessmen who looked at a sixty percent decline and said “Let’s keep the course” are former ones.

        • Sometimes one has to accept a downturn in order to keep in business. The alternative is either to keep slashing the number of employees until there aren’t enough to keep the business going — or wind up the business.

          I suspect a lot of the pain the newspapers are suffering now arises from the following cycle:

          falling circulation -> lay off staff to preserve/increase profit margins -> less news coverage & of worse quality -> more falling circulation -> etc.

          In some cases there won’t be any alternative to this vicious circle, but many newspapers could avoid this by simply not laying off staff in the first place.

    • So the newspaper business is not what it was, revenue-wise, twenty years ago. But it is equivalent to what it was *seventy* years ago…

      … when newspapers *weren’t* considered in decline.

      Consider two men. One of them is in the elevator of the Empire State Building, going up, just passing the 37th floor. At the same time, a man who fell off the top of the building is plummeting past the 37th floor in the opposite direction.

      According to your notions, they’re both in the same position — 37 stories up. In practice, I have this sort of vague intimation that I could easily figure out which one I would rather be.

      What it actually looks like to me is that newspaper revenue has fallen to a point in time when newspapers were considered healthy, profitable institutions.

      And is still falling. Did you bother to notice the slope of the curve?

      Added to which — the U.S. today has more than double the population and seven times the GDP (adjusted for inflation) that it had in 1950. This means that even if the newspaper industry were to magically stabilize at its current level of revenue, it would be taking in less than half of its former revenue from each American — reflecting, in part, the much smaller percentage of people who read the papers today — and less than one-seventh of its former share of the national economy. If that sounds like a healthy industry to you, I’d like to know what you consider a sick one.

      • Christ Almighty, I never said it wasn’t a sick industry. I said I didn’t understand the comparison, and I gave my reasons why. They made a big deal out of “adjusted for inflation” which put me in the mindset of “this is essentially the same amount of money.”

    • That’s because the chart isn’t done per capita, even though I suggested it. Here’s what it looks like if done the way Tom and I suggest, showing the real peak was in the late ’80s. Of course, they still pulled in $39 billion last year, hardly chump change as you say, but how long can that last? As Tom notes, they’re still on the way down.

  4. In 1950 there was less total advertising, and the newspapers had a much larger market share of it. They were very important sources of information. Total newspaper ad revenue rose with the total ad revenue into the year 2000. But then those dollars left newspapers.

    Those dollars haven’t gone away. They have migrated to other venues. So today the newspapers have a much smaller share of the market. This indicates their importance is diminishing. It’s a measure of how the population values them relative to other venues. Circulation is also falling. That is very different from 1950, and indicates newspapers are being eclipsed by other venues.

    I always figured Craig’s List was the death blow. It took billions in classified ad revenue. Craigs is a better product, and much of it is free. That’s a classic and very focused technological disruption.

  5. In 1950, wasn’t newspaper advertising the predominant form… and weren’t there so many more newspaper in existence? So why is this a surprise?

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