Report Predicts 4 More Years of Newspapers Hemorrhaging Ad Revenues

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The good news is that digital versions of newspapers are beginning to attract more readers. The bad news, according to the annual PricewaterhouseCooper's Global Entertainment and Media Outlook report ("GEMO") released this week, is that newspapers' revenues overall will continue to plunge through at least 2017.

According to an Ad Age article about the report, even in the face of climbing circulation figures, declining advertising at a compound annual rate of 4.2 percent means overall newspaper revenues are forecast to drop at a combined annual growth rate of 2.9 percent between 2013-2017.

The Ad Age piece cites Newspaper Association of America 2012 figures showing newspaper Web sites attracted more than 100 million unique visitors. The GEMO report predicts a 9.7 percent compound annual growth rate in digital advertising over the next four years that, unfortunately, will largely be negated by a 7.8 percent compound annual drop-off in print edition ads.

Digital newspaper ads are expected to generate $5.5 billion in revenues by 2017, compared to $12.8 billion in print ads, according to the GEMO study.

Forecast: Newspapers to See Ad Revenues Disappear 'Virtually'

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Over the next four years, the Internet will leave newspapers in a trail of dust in pursuit of advertising revenues, and will supplant the print media as second only to television as the nation's largest advertising medium.

So says the annual Global Entertainment and Media Outlook report released today by accounting firm PricewaterhouseCoopers. The report, covering 2010-2014, predicts online advertising (excluding mobile ads) will climb from $24.2 billion in 2009 to $34.4 billion by 2014, according to a story in today's Wall St. Journal.  The report is less confident about newspapers, forecasting ad revenues to shrink in 2014 to $22.3 billion. According to  the Newspaper Assn. of America,  print advertising revenue was $24.82 billion in 2009.

Advertising in interactive media, email and video will increase dramatically, according to PricewaterhouseCoopers, to $6.6 billion in 2014 from its $4.7 billion level in 2009. The report cites the Internet's inventory potential and greater broadband saturation as factors underlying the report's estimates. Roughly 64 percent of U.S. households currently have broadband access, up from 34 percent broadband penetration in 2005.