Friday, August 31, 2007

Small Online Gains Fail To Halt UK Regional News Shrinkage


By Robert Andrews

Despite continued digital inv*stm*nts, Britain's regional newspapers lost around GBP 225 million ($444 million) in 2006 - and online growth is nowhere near enough to make up the fall. Amongst findings in The Newspaper Society's Annual Regional Press Survey for 2006, published today ( release)...

-- The number of websites operated by the regional press ballooned by a third, from 828 to 1,102, as publishers looked to the web to shore up the bottom line.

-- But online ad revenue from all of those sites combined accounted for just GBP 71 million ($142.91), a mere 2.5 percent of total ad revenue. (This was an 18.3 percent growth from the previous year's GBP 60 million, ($120 million) when online ads comprised two percent of the mix). So the entire regional newspaper sector only brought in an additional GBP 11 million ($22.1 million) from online ads in the year.

-- Even magazines and niche supplements brought home more ad revenue than the web - GBP 74 million (GBP 149 million), or 2.6 percent of the advertising base (up from GBP 51 million ($102.6 million), or 1.7 percent of the mix). The number of these titles grew 21 percent from 595 to 755.

-- Illustrating why the sector is so vulnerable, print ads still make up 94.5 percent of regional advertising revenue (GBP 2.67 billion, $5.23 billion). The year before, print had comprised 95.9 percent of ad revenue, GBP 2.86 billion ($5.76 billion), so publishers have slimmed their reliance but not by enough, and that's a loss in print ad revenue of GBP 187 million ($376.4 million). This is so critical because advertising makes up 73.2 percent of turnover, circulation sales only 15.4 percent.

-- Staffing levels fell from 52,889 to 49,246. While the number of advertising and sales staff grew, editorial and production jobs declined.

Overall regional press turnover was GBP 3.87 billion ($7.79 billion), down from GBP 4.09 billion ($8.23 billion) the year before. Yesterday's H1 earnings from Johnston Press are typical - publishers are putting more and more resources into online while seeing continuing, if slower, print ad declines. This detail of this snapshot may be nuanced - in the first half of this year, both Johnston and the two other strong regional newspaper publishers Trinity Mirror and DMGT both grew online revenue by more than than the Newspaper Society's 14 survey respondents overall did last year.

Update: ABC circulation figures released today for the half-year to end of June saw almost all local titles post a fall, HoldTheFrontPage reports, with Manchester Evening News, England's third biggest selling regional, experiencing the largest drop-off of 24.2 percent year-on-year (via Guardian).
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