Statistical, Ecosystems and Competitiveness Analysis of the Media and Content Industries: The Newspaper Publishing Industry

Table 8: Advertising and circulation in global newspaper publishing market (US-$ millions) 
2006 
2007 
2008 
2009 
2010 
Print advertising newspapers 
111962 
109732 
100341 
81525 
80885 
% Change 
-2,0 
-8,6 
-18,8 
-0,8 
Digital advertising newspapers 
4127 
5369 
5842 
5634 
6404 
% Change 
30,1 
8,8 
-3,6 
13,7 
Circulation 
newspapers 
69503 71756 73137 72534 72457 
% Change 
3,2 
1,9 
-0,8 
-0,1 
Total 
newspapers 
185592 186857 179320 159693 159746 
% Change 
0,7 
-4,0 
-10,9 
0,0 
Source: PwC, 2011. 

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The Newspaper Publishing Industry 
39
 
In the first decade of the 21
st
century, print remains the main revenue driver for newspaper 
publishers.
14
Digital advertising accounted for 2% of the spending on newspapers in 2005, 
rising only to 4% in 2009 (calculated from Table 8).
Until now, the increase in online advertising and spending has not made up for loss in 
advertising and sales revenues from print for newspaper publishers. This issue has been 
referred to as the 10% problem (Karp, 2007). Karp illustrates this by comparing the 
readership of print newspapers (in circulation) with the online reach of their website (in 
unique visitors). The reach of its print newspaper represents roughly about 10% of the total 
audience reach, the other 90% comes from online reach of news (in unique visitors). With 
advertising income, the opposite is the case; online advertising revenue is worth 10% of total 
advertising revenue, the other 90% comes from print advertising. Karp (2007) offers an 
example based on New York Times statistics: on an average weekday in 2007, 1.1 million 
people read a paper copy of the New York Times. At the same time, the website of the 
newspaper is visited by 13.3 million people each day, i.e. 12 times as many. Analysing the 
advertising income, the opposite trend is visible. Karp states that total advertising revenue is 
approximately 484 million USD, and online advertising accounts for 51 million USD (10.5%) 
for the New York Times in 2007. 
The decline in print advertising can, for an important part, be attributed to the decline in 
classified advertising. In the United States in 2000, classifieds counted for almost 20 billion 
USD and 40% of total advertising revenues for newspapers (WAN IFRA, 2011). In 2009, the 
income from classifieds had fallen to just 6.2 billion USD. On the one hand, the companies 
publishing classifieds in newspapers experienced the effects of the economic crisis and thus 
spent less on advertising, and on the other hand, a large number of online substitutes for 
classified advertising (e.g. Craigslist) have been launched since approximately 2000 
(Grueskin, Seave, & Graves, 2011). American research showed that in 2009 the number of 
adults with internet access who used online classified ads has more than doubled since 2005. 
Almost half (49%) of all American internet users say they have ever used online classified 
sites in 2009 (Jones, 2009). WAN-IFRA reports similar developments in European countries; 
in the UK classified ad revenue fell 45% year on year by 2009 and countries such as 
Switzerland and The Netherlands also reported half their classified revenues had migrated to 
online players (WAN IFRA, 2011). In response, a number of newspaper publishers have 
bought online services that offer classified ads; Norwegian publisher Schibsted for example 
has bought LeBonCoin, a French classifieds portal (
http://www.leboncoin.fr/
) and Sanoma 
bought Autotrader, a Dutch website for buying and selling cars (www.autotrader.nl).