Posted July 8, 2009 12:20 pm by with 6 comments

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If you work for a smaller paper or you have a favorite local paper that you simply don’t want to see fade into the sunset this is OK news. I can’t honestly say that there is real good news. It’s about the newspaper business after all. TechCrunch reports that statistics gathered by the Inland Press Association show that overall the average drop in profits for the industry as a whole was 77.6%, So how do you find a bright spot in that kind of number? You look at who is floundering the least and go from there.

The sad thing is that even of the economy comes back strong at some point this century newspapers may not even see improvement because it’s the medium, not the economy, which is the biggest culprit in the agonizing demise of a once vibrant industry. The chart below shows just how bad things are for the newspaper industry and there is little hope for recovery.

Inland Press

Only one category saw a revenue bump in over the 5 year span studied and that was the smallest of the small papers. There are many possible reasons for this including the lack of online hyperlocal content thus allowing the paper to still be relevant as well as the lower overhead. But is this just delaying the inevitable?

One major reason for the little guys still holding some ground is the classifieds. I personally never look at the classifieds for much of anything so I am a little surprised by this

Another sign of hope: small papers still have a hold on classifieds. Average classified sales for small papers have actually gone up, at a time when they have been declining for most papers. Inland cites an example of a daily newspaper with a circulation of less than 15,000, which posted a 210.4% increase in classified revenue from 2004 to 2008. But it didn’t do much good. The paper’s profits were down by almost 30%.

Now the paper’s profits were down 30% which still means that they were profitable. Now, we’re getting somewhere. This data, however, is just like most where it can be a bit misleading. Considering the sources were the papers themselves and the information was offered voluntarily and with anonymity there may be room for some fudging. Also, there was no recognition of who suffered tremendous losses and who fared OK. The numbers can best be seen as an average.

Who really knows the real deal but there is certainly not a lot of room for celebration. When you have to concentrate on who suffered the least then you have to figure that no matter where a paper is on the scale of size there is not a tremendous amount of hope for the future.

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  • Read the same report on Newsosaur…

    Looks like the papers are still holding double digit profits on smaller revenues. The trend I notice is local and national newspaper media companies trying to edge into the digital space via consulting services offerings.

    What makes me curious is how many SMBs are willing to pony up for Web consulting from their local ink and paper ad source. I can see the appeal from larger businesses, since the papers would essentially farm out the work to creative shops around town and keep the excess profit.

    In other words, are local newspapers trying to become ‘Ad Dollar Aggregators’?

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  • Mitch Lomax

    Interesting. I read this study last week, which seems to indicate that TV stations in smaller markets are also doing better on the Web.

    Just less competition in town, I guess.

  • Looks very interesting. Thanks for sharing..

  • I’d like to see some numbers on the subscriber base for the smaller papers. The research indicates that the amount classified ads increased in the papers with smaller circulation. Perhaps the reason for this is that they are losing subscribers at a much smaller rate than large media publications. That could be related to demographics. Are small town residents less likely to get their news from the Internet and less likely to use Craigs List for classifieds?

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