Friday, June 2, 2017

Bad: Newspaper Circulation Hits 77-Year Low

Following last year’s presidential election, some major U.S. newspapers reported a sharp jump in digital subscriptions, giving a boost to their overall circulation totals. The newspaper industry as a whole, however, faced ongoing challenges in 2016, according to new Pew Research Center analysis.

Newspaper circulation continues to fall

Yearly financial statements show that The New York Times added more than 500,000 digital subscriptions in 2016 – a 47% year-over-year rise. The Wall Street Journal added more than 150,000 digital subscriptions, a 23% rise, according to audited statements produced by Dow Jones. And the Chicago Tribune added about 100,000 in weekday digital circulation, a 76% year-over-year gain, according to its filings with the Alliance for Audited Media (AAM), an organization that verifies many daily newspapers’ circulation figures.

But these gains did not translate into circulation growth for the industry overall. A Pew Research Center analysis of data from AAM shows  total weekday circulation for U.S. daily newspapers fell to 35 million, while total Sunday circulation declined to 38 million – the lowest levels since 1945. (For more information on how these totals were calculated, see our fact sheet.)

This overall decline in circulation coincided with a double-digit decline in advertising revenue for the industry as a whole. A separate Pew Research Center analysis based on the year-end financial statements of seven publicly traded U.S. newspaper companies suggests that advertising revenue across the industry declined even more sharply than in recent years: a 10% decline, which outpaces the 8% decline in 2015. This decline put total ad revenue for the industry in 2016 at $18 billion. This is nearly a third of what it was just 10 years ago: In 2006, the Newspaper Association of America, now known as the News Media Alliance, put total industry ad revenue at $49 billion.

Newspapers' circulation revenue climbs steadily even as advertising declines

By contrast, circulation revenue has been steady over the past few years, rising from $10.4 billion in 2012 to $10.9 billion in both 2015 and 2016. This is a small bright spot for the industry, and comes as some publishers are pursuing a “subscription-first model” by focusing on growing the number of subscribers rather than retaining advertising revenue.

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