The OECD report «The future of news and the Internet» provides an in depth-treatment of the global newspaper market and its evolution, with a particular view on its economics, the development of online news, related opportunities and challenges and policy approaches.
The evolving newspaper publishing industry, its economics and the downturn
- After very profitable years, newspaper publishers in most OECD countries face declining advertising revenues, titles and circulation. The economic crisis has amplified this downward development.
- About 20 out of 30 OECD countries face declining newspaper readership, with significant decreases in some OECD countries. Newspaper readership is usually lower among younger people who tend to attribute less importance to print media.
- The regional and local press are particularly affected and 2009 is the worst year for OECD newspapers, with the largest declines in the United States, the United Kingdom, Greece, Italy, Canada, and Spain.
- Employment losses in the newspaper industry have intensified since 2008 particularly in countries such as the United States, the United Kingdom, the Netherlands and Spain.
- However, large country-by-country and title-by-title differences and the data currently do not lend themselves to make the case for “the death of the newspaper”, in particular if non-OECD countries and potential positive effects of the economic recovery are taken into account.
The Economics of the newspaper industry
- On the revenue side, the global newspaper publishing market derives about 57 per cent of its revenues from advertising. The reliance on advertising is extremely high in countries such as the United States.
- On average, online advertising only accounted for around four per cent of total newspaper revenues in 2009, and fell strongly in 2009. In general, the online revenues of newspapers are miniscule in comparison to total revenues and online revenues of other digital content industries.
- On the cost side, costs unrelated to editorial work such as production, maintenance, administration, promotion and advertising, and distribution dominate newspaper costs. These large fixed costs make newspaper organisations more vulnerable to the downturns and less agile in reacting to the online news environment.