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BizReport : Research : November 09, 2007
Borrell: Newspaper online divisions fare well
Newspapers may not be faring as badly as some reports have noted, though they are by far not operating at past revenues. According to a new study from Borrell Associates, thanks to their online divisions, newspapers are continuing to stay relevant with advertisers and with consumers.
According to the report online revenue in the US now accounts for roughly 5% of the total revenue for newspapers. Online revenue could hit 10% in 2008/2009. For Canadian newspapers, online revenues account for 3.5% for the metropolitan daily papers; for smaller, community papers, online revenues account for only about 1.75% of the total revenue. And in the UK, about 10% of total revenue is thought to be from the online arena.
However, because readers continue to turn to online versions of their local paper, the report suggests that newspapers need to be on the cutting edge of new media in order to remain relevant for advertisers and consumers alike.
"Newspaper operating profits have mostly been falling since 2007 and in the U.S., for example, are hovering around 23 percent. However, mature online operations are generating 40 percent and higher profit, suggesting that achieving a critical mass of online ad revenue translates to profit at a much higher rate than print ad revenues," was written in the report.
Tags: newspaper, newspaper advertising
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