Media studies present charts of doom for news industry

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Last week was a week of media data porn. Both the Reuters Institute and the Pew Center released their studies on media and media consumer behaviour. The Pew report focussed, as it always does, on the U.S. The Reuters surveys covered 26 countries. There was a wealth of charts, survey results and data sets in each report. But a few trends and surprises jumped out at me.

It's no shock that newspaper ad revenue is decreasing, but the Pew data shows that in 2015 that revenue decreased by almost eight per cent, the biggest fall since 2009.
Over the same period we saw an even more dramatic decrease in folks who read any daily newspaper. This is especially true, surprisingly, in the 45-54 age group. In 2000, about 60 per cent of them read a paper. Today it's just over 30 per cent. And, in all age groups we're seeing a steady decline.

Newspapers are suffering a shrinking of their slice of the advertising pie: from about 15 per cent of all media spends in 2014 down to just south of 12 per cent this past year.
Even worse news comes from the Reuters survey that asked participants in over two dozen countries how many of them had paid anything for online news in the past year. In Canada only nine per cent of the respondents had. In the U.K. it's even worse, at seven per cent. The best outcome for online news is the response from Norway, which suggests that a quarter of Norwegians dished out cash for online news.

But, the most depressing stat was this: the rate of readers using ad blockers on websites is consistently high, and higher the younger the readers are. Ad blockers are pieces of software you can install in web browsers or mobile devices to winnow out ads on websites before the page is rendered for your reading pleasure. When you block an ad, neither the advertiser nor the news site that hosts it gets any benefit. In the U.S., 44 per cent of folks who browse the web aged 18-24 use an ad blocker.

In some ways, media sites have brought the ad blocker phenomenon on themselves. They have either loaded up their sites with intrusive, bandwidth-hogging ads or have allowed ad delivery services and ad federators to do that on their behalf. But, wherever the blame lies, the result is that ad blockers are killing the display ad business online.
Unfortunately, media sites are responding in less than useful ways, blocking users who use blockers, for example. And, they have been looking to other revenue sources, including sponsored "journalistic" content created for advertisers and inserted into online and print news products.

One of the surprising survey results from the Reuters study showed that in Canada, U.S., Italy and the U.K., for example, a higher percentage of respondents were prepared to see sponsored content on news pages than traditional display advertising.

Even more surprising was an introduction to the Reuters report penned by Mark Thompson, the CEO of The New York Times. Mr. Thompson writes:

"Display still has a place, but we believe that the digital advertising of the future will be dominated by stories conceived by advertisers, clearly labelled so they can be distinguished from newsroom journalism, but consumed alongside that journalism on their own merits."

Stories conceived by advertisers ... consumed alongside that journalism. Let that sink in. Then listen carefully: that gurgling whoosh you hear is the sound of the news business, as we know it, circling the bowl.

Listen to an audio version of this column, read by the author.

Wayne MacPhail has been a print and online journalist for 25 years, and is a long-time writer for rabble.ca on technology and the Internet.

Photo: Fuzzy Mannerz/flickr

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