Bad News: U.S. Newspapers Receive Poor Forecast
The long-term decline in newspaper advertising revenues will continue unabated in coming years, according to the latest round of ad spending forecasts from
PricewaterhouseCoopers, ZenithOptimedia, and Magna Global. All three forecasters see more drops and a diminishing share of overall ad spending in the middle years of this decade.
PwC
sees print advertising revenues for North American newspapers falling at a compound annual rate of 4.2% from $22.6 billion in 2011 to $18.3 billion in 2016, for a total loss of $4.3 billion or 19%
over this period. As in previous years, the declines in developed markets, including North American and Europe, will be mitigated somewhat by growth in developing markets in two regions: Asia-Pacific
and Latin America.
ZenithOptimedia’s global forecast is similarly pessimistic, with total newspaper revenues worldwide set to drop from $96.1 billion in 2011 to $94.2 billion in
2012, $93.2 billion in 2013, and $92.8 billion in 2014. Growth in emerging markets will fail to offset steep declines in developed markets.
According to ZO, the medium’s total share of
ad spending will drop from 20.2% in 2011 to 16.7% in 2014.
Magna Global also sees more declines ahead, with total newspaper revenues in North America set to fall 6.6% this year, while
global newspaper ad revenues drop 1% to $85.5 billion. The rate of decline in the global figure will moderate from 2011, when total revenues slipped 3%, thanks to growth in emerging markets as well as
the impact of the sports events including the Olympics in developed markets.
The decline in newspaper advertising revenues has been dramatic. From peak revenues of $49.3 billion in
2005, total ad revenues tumbled to $23.9 billion in 2011, according to the Newspaper Association of America, for a 51.5% drop in just six years.
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