To give a nod to Ross Perot, that giant sucking sound you hear in the news media world is the old gatekeeper model going away. Rapidly.
Carpe Diem blogs at the American Enterprise Institute, which can also be credited for the rather jarring graph shown above:
Newspaper print advertising revenues of $18.9 billion in 2012 fell to the lowest annual level of print advertising since the NAA started tracking industry data in 1950. In 2012 dollars, advertising revenues last year were below the $19.75 billion spent in 1950, 62 years ago.That last paragraph wasn't lost on the RS' Bruce Ross, who commented on Facebook today: "Hard to hold on to one's umbrella, but it does keep life interesting."
The decline in print newspaper advertising to a 62-year low is amazing by itself, but the sharp decline in recent years is pretty stunning. Print ad revenues fell by almost 50% in just the last four years, from $37 billion in 2008 to less than $19 billion last year; and by 66% over the last decade, from $56.3 billion in 2002. [...]
Even when online advertising is added to print ad revenue (see red line in chart), the combined total spending for print and online advertising last year was still only about $22.3 billion, which is the lowest amount of annual ad revenue since 1953, when $22.5 billion was spent on print advertising. The introduction of online advertising in 2003 has helped to increase total ad revenues (print + online) a little bit, but online advertising has remained flat at about $3 billion per year for the last six years, and was actually lower last year ($3.37 billion) than in 2007 ($3.5 billion in 2012 dollars).
Economic Lesson: The dramatic decline in newspaper ad revenues has to be one of the most significant Schumpeterian gales of creative destruction in recent years. And it’s not over. One recent special report from IBISWorld on “Dying Industries" identified newspaper publishing as one of ten industries that may be on the verge of extinction in the United States.
The people who know me know they can get me started when it comes to the reasons behind the decline of newspapers. I'm struck by the fact that in my 4 1/2 years at the Capital Press, my editor and publisher have made more substantive changes than all of my other employers in the previous 20 years combined. They've changed our approach to stories, assigned new beats to reporters, changed the format and the layout, combined our four zone editions into one edition, moved field positions around to where they're most needed and revamped the website. And a year ago they more formally changed our deadline structure to focus on a daily newsletter that goes out to our readers, giving us even more of a daily presence. And they laugh at me when I tell them I was once on a committee that took a year to decide how to change the masthead on a previous newspaper's education page.
All these changes in actions and approach have occasionally been a shock to our readers, but we're still changing -- and our company is still growing. Our management team is fully aware that in this industry, you either change or you die.
I'm amazed at how many newspapers basically haven't changed a thing in the last 10 or 15 years or longer. They have the same look, the same page layout and order, the same reporters' beats (and in some cases the same beat writers), the same ratio of wire stories, the same TV grid and comic strips, and the same condescending attitude toward the communities they cover. Their websites merely provide another platform with which to do the same things they've been doing since their heyday. In a way, you've really got to hand it to newspapers for hanging on as long as they have. Most other businesses that have been this stagnant amid such a rapidly changing world would be dead and gone already. But it's no wonder people are walking away from them in droves.
Of course, Diem's data also partly explains why so many newspapers large and small have aligned themselves so completely with our current leadership in Washington and Sacramento. Gaining an "official" status (and perhaps a taxpayer subsidy) and seeing the new-media competition get harassed and regulated out of existence may be their only means of survival.