Commentary

Are Print's Worst Days Over As Digital Gains Balance Out Print Losses? Don't Bet On It

by Sean Hargrave , Staff Writer, December 2, 2016

One of the huge questions in publishing, other than "anyone fancy buying our newspaper group?," has been the perennial puzzle of when it will stop being quite so bad. At what stage will print fall off the edge of a cliff, in terms of ad revenue, and level off with digital gains?

Well, that point could potentially be now or at least about now. The proof may well come from the Daily Mail Group results today, which show that Mail Online had a massive surge in ad revenue. Its revenue was up by nearly a quarter from GBP73m to GBP93m. That extra GBP20m, however, was offset by an GBP18m drop in print advertising revenue. The seesaw looks like it just might be balancing out, then.

For all newspaper groups, the issue has always been the same. Their annual figures will always highlight digital growth while the sharper eye then has to track down the bulletted points a little to see that despite digital doing well, print revenue is still way down.

Research that I saw a good year or so ago marked 2016 as the year in which the leaking of cash from print would be offset by digital and, to be honest, it looks to be right. However, there is a major caveat. Digital rises may well now be covering print's losses, in advertising terms, but not in circulation. The Daily Mail Group, for example, saw a GBP10m drop in operating profit, despite advertising revenue gains and losses roughly balancing one another out.

The other elephant in the room is that newspapers are now looking for growth in an area where they are minnows in comparison to the BBC and Facebook. All you need to do to get an idea of the tough challenge ahead is look at an attention chart for UK news. The BBC is way out there with a near monopoly with Facebook trailing. Only Mail Online makes an impression on the bar chart which is otherwise a flat landscape that barely registers any interest at all for any news group in comparison to the ad-free BBC news site and the ever-popular social media giant.

So when it comes to driving new growth to carry on making up for print's slide, this really is the last channel in which you would be looking for revenue, stuck between the rocks of the BBC and Facebook.

Print may well have reached its nadir -- but it's hard to see it doing anything other than bouncing along the bottom. It's almost impossible to imagine it bouncing back.

death of print, london, news, newspapers, revenue, uk

3 comments about "Are Print's Worst Days Over As Digital Gains Balance Out Print Losses? Don't Bet On It".

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Stephanie Hanaway from AAFP, December 2, 2016 at 4:40 p.m.
Is it possible that, one day, headlines will stop referring to the decline and demise of "print" when what the journalist is really referring to are newspapers? Haven't most of us figured out by now that the suffering experienced by newspapers isn't caused by the paper the news is printed on but rather on the age of the news by the time it arrives in print?
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Jessie Sampson from Newsworks, December 5, 2016 at 11:31 a.m.

You paint a pretty bleak picture Sean and omit some key points, which might temper the drama a bit…

1. 1. There is still value in print. 65% of the population are reading print newspapers every month according to NRS PADD (rising to 91% when you include all platforms), showing that they are far from irrelevant as you indicate. In terms of circulation, six million people still buy a newspaper daily and a further two million pick up freesheets (ABC). The fact that newspaper circulation surged around the EU referendum and was also up in October, as the US election picked up pace, shows that people still turn to newspapers to understand the world.

2. 2. Like it or not, there is the view that newspapers offer value for advertisers which can’t be easily replicated elsewhere – taking into account powerful context, levels of reader engagement and proven return on investment (have a look at Newsworks’ effectiveness research for quantifiable evidence of this): https://effectiveness.newsworks.org.uk/?utm_source=Newsworks&utm_medium=RPC&utm_campaign=Newsworks

3. 3. Facebook is obviously a massive presence in the digital landscape, but it doesn’t produce news. In fact, as recent reports show, it doesn’t verify it either. Paired with the various metric mishaps that have come to light, it’s fair to say that Facebook isn’t without its own issues, for both advertisers and consumers. By the same token, the quality content and context that newsbrands provide are not irrelevant to advertisers. You’ll find plenty of examples of this here: http://www.newsworks.org.uk/awards

Sean Hargrave from Sean Hargrave, December 5, 2016 at 12:10 p.m.

All good points. Print is universally used to differntiate the printed medium from digital and so I'd say it's a fair use.
Newspapers can always drum up big numbers for readers. However, you only have look at ad spend to see which way the wind is blowing there. Trust me, as a former nationals journalist I am an 'ink man' at heart but you can't help but look at the declining share of ad revenue and come away with anything other than concern.
The point here is that at least digital gains are now balancing out print losses which has to be a welcome relief. The bad news is they're now looking for growth in digital where the BBC and Facebook hold nearly all the attenition.
Nothing to do with news and quality of articles etc, all about attention and ad spend.