Mutter: Print ad losses outstrip digital gains 22 to 1

Reflections of a Newsosaur
Alan Mutter decided to look into the conclusion in PEJ’s State of the Media report that newspapers lost $7 in print advertising revenue for every $1 gained in digital ads in 2010. If you go back five years, Mutter writes, the trend is worse: $22 lost in print revenue for every $1 gained in digital ads:

The difference between my findings and the Pew conclusions is that Pew only looked at the performance of newspapers in the last two years, a period in which most publishers put more emphasis than ever on building digital revenues to offset their print losses.

Poynter business analyst Rick Edmonds told me he doesn’t quibble with Mutter’s math, although he believes such comparisons are most useful “when calculated year by year, and watched going forward.”

However, he said Mutter’s calculation “loads the dice by starting the year that print ad revenue began to swoon. A full decade, for instance, would capture the earlier years of the 2000s when digital advertising was growing quickly and print was still increasing by a little.”

A larger question unaddressed by both PEJ’s and Mutter’s calculations, Edmonds said, is how newspaper companies are replacing print advertising money with other types of digital revenue:

With paywalls coming into place, newspapers could show a better result simply by including new digital subscription revenue and “other” revenues from things like events, contract printing and social media consultation. Calculating all that on an industry basis is easier said than done, but the industry ought to go to the trouble to put its best foot forward.

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