American Newspapers in Dire Straits
France’s Les Echos reflects on the sad state of American newspapers, which have never earned less money in their history. Lucie Robequain reports.
The American press has generated $33 billion in revenues last year, its lowest level since at least half a century.
The last few months have been particularly bloody for the U.S. newspaper and magazine industry: “Newsweek” magazine ceased its paper publication. Time Warner announced its complete withdrawal from the magazine industry (“Time”, “Fortune”, etc.). NewsCorp’s “print media” division (“Wall Street Journal”, “New York Post”, etc.) is hardly faring any better.
Behind these decisions lie alarming revenue levels not seen since at least half a century. As far back as the statistics go (1956), American newspapers have never earned so little money, reveals Statista Institute in a report released this week. They reached $33 billion in revenues last year. Their income has shrunk by more than half since 2000, the best year ever for the American press. But since then, circulation revenues shrank by a quarter while print advertising fell 70%.
Internet advertising is far from offsetting this decline: for every dollar of additional income on the web last year, newspapers lost $16 print advertising dollars. Of the $37 billion that advertisers spend on the Internet, newspapers receive no more than a tenth. Five companies share almost the entire cake: Google, Yahoo, Facebook, Microsoft and AOL.
But not all hope is lost. U.S. newspapers hope to boost their income by charging for access to their web sites. They are already one-third to do so. For the “New York Times,” the strategy has already paid off: the ‘paper’ now generates more revenue from its distribution (print and online) than from advertising.
At this stage however, the financial difficulties of the press have serious consequences. In twenty years, the number of American editors was reduced by nearly 30%, according to a report published a few days ago by the Pew Institute on “state of the press in 2013.” Newspapers employ fewer than 40 000 full-time journalists, the lowest level since the 1970s. They increasingly rely on outside contributors, whether freelancers or unpaid writers (“Les Echos” April 15).