Monday, October 26, 2009

Record plunge: Newspaper circ at pre-WWII low

Following an average drop of 10.6% in the last 12 months, daily newspaper circulation has fallen to a pre-World War II low of an estimated 39.1 million, according to an analysis of industry data released today.

The first double-digit circulation decline in history means only 12.9% of the U.S. population buys a daily newspaper. The analysis is based on data provided by the Audit Bureau of Circulations, an industry-funded group.

Newspaper circulation now is lower than the 41.1 million papers sold in 1940, the earliest date for which records are published by the Newspaper Association of America. Back in 1940, newspapers were purchased by 31.1% of the population.

Sunday circulation, which fell an average of 7.5% in the last six months to an estimated 40.9 million copies per week, is at the lowest point since 1945 when it was 39.9 million.

At that rate, Sunday papers in the last six months reached only 13.5% of Americans, as compared with 28.5% in 1945, when the population was less than half the size it is today.

My circulation estimates are calculated on the entire universe of some 1,400 dailies in the United States. In announcing the most recent circulation decline, ABC put daily readership at 30.4 million for the 379 newspapers in its sample, which reflects most of the biggest papers. But a lot of smaller properties are not counted in the ABC figure.


30 Comments:

Anonymous Anonymous said...

Yes, Alan, but what was the cost of the newspaper in WW2, compared to today? And what percentage of personal income did buying a newspaper represent? We have a situation today where newspapers are battling to increase subscription and per-copy prices in order to bring in more revenue. People notice when they have to open their wallets for bills rather than dipping into their pockets for coins.

7:53 AM  
Blogger Joyce P. Simkin said...

And, then there are us subscribers in the Detroit Metro Area. The two Detroit papers don't even deliver a daily paper anymore (we only get a printed paper on Thursday, Friday, and Sunday).

8:16 AM  
Anonymous John Reinan said...

That's a chilling perspective. One would certainly think that a lot of the decline is due to secular changes -- i.e., the Internet.

But I'd think the overall rotten economy has to play into it, as well.

When you're worried about money -- perhaps you or your spouse has lost a job or had hours & benefits cut back -- then that six-month renewal for $80 or $100 seems like a pretty big chunk of change to a lot of people.

I know that $100 is a sum I think pretty carefully about spending these days -- although I still have my seven-day Star Tribune subscription.

9:01 AM  
Blogger Al Cross said...

Alan, thanks for specifying that these figures are for DAILY circulation (except at the start of the third graf, where you left off the adjective). Circulation remains relatively strong at weekly newspapers, and at small dailies not affected by Craigslist, excessive chain debt or local economic trauma.

9:13 AM  
Blogger yelvington said...

Anonymous asks "what was the cost of the newspaper in WW2, compared to today?"

I think daily papers in the 1940s were generally in the range of 2 to 5 cents.

According to http://data.bls.gov/cgi-bin/cpicalc.pl:

* A 2-cent 1941 price would amount to 29 cents today.
* A 5-cent 1941 price would amount to 73 cents today.

Most US newspapers currently charge 50 cents, which is right in the middle of the range. A substantial minority charge 75 cents, which is slightly above the 5-cent equivalent.

9:44 AM  
Anonymous Anonymous said...

News content is much the same between all newspapers. Diversity does not extend to right leaning news and/or comment.
Where are the Fox News of print? Is it any wonder that the WSJ seems to be doing well?
I am all but forced to use the internet to keep myself current.

9:46 AM  
Anonymous M. Sheehan said...

Could it be that the content is no longer compelling, there is no longer a clear demarcation between opinion and news reporting and newspapers were too comfortable with their monopoly before the internet and mobile media pulled the rug from under them. No business endures that does not invest in the future.

9:55 AM  
Anonymous Anonymous said...

To ascertain the circulation decline requires using a standard base, such as circulation per 100 households. In 1940, daily newspaper circulation was 115 copies per 100 households and Sunday circulation was 105 copies per 100 households. Daily circulation now is 35 copies per 100 households and Sunday is 36 per 100 households. In actual terms, daily circulation has decreased almost 70 percent and Sunday has decreased 66 percent. Circulation, of course, has been sliding since the mid-1960s, but the losses the past seven years have been dramatic. A few more years of this will result in circulation of perhaps only one-fourth of households. The last figure for median age of newspaper readers was 62.

10:34 AM  
Blogger Martin Langeveld said...

"Back in 1940, newspapers were purchased by 31.1% of the population" - at first glance this leaves the impression that 69% didn't get a paper, which was not the case, of course. A better way to look at this is that in 1940, there were 34,949,000 occupied households buying 41,132,000 newspapers on the average weekday, or 118 copies for every 100 households. The equivalent number today is 33 copies per 100 households, and it's dropping fast. In 2000 it was 53 per 100; in 1990 it was 66 per 100.

I think you have something askew in your final sentence. With 40.9 million Sunday papers going to 116.8 million households, that's a rech of 35.0%, not 13.5%. And in 1945, Sunday sales were 39,860,000, vs. a household count of 39,251,000 (extrapolating between 1940 and 1950 census counts, although with the war effect 1945 was probably a bit lower). So Sunday household reach in 1945 was at least 101.6%, and probably closer to 103%.

10:47 AM  
Anonymous Anonymous said...

Newspapers seem to have many more pages, mostly not news. Perhaps trying to please everyone, they please noone.

11:17 AM  
Anonymous Philanthropist said...

I think this 12.9% includes the papers they give away, or just every paper they happen to print because that number is higher than what I see people actually doing.

12:34 PM  
Anonymous Anonymous said...

Newspapers no longer provide anything that is useful to readers.

We can get most of our information direct from the source through the Internet. Newspapers suppress important stories like the ACORN scandal, so what use are they?

1:05 PM  
Blogger Randolph said...

Of course a lot of people read two papers a day in 1940. How does that affect the calculation?

3:53 PM  
Anonymous PaulB said...

To the extent that some of us still receive more than one daily paper, your calculation that 12.9% of households subscribe to a paper is too high.

5:18 PM  
Anonymous Rick S. said...

Your penetration figures are confusing.....shouldn't you be calculating "copies divided by households," not "copies divided by total population" ?

6:18 PM  
Anonymous T Heller said...

The cost of newspapers must be considered in relation to the cost of other consumer choices. Here's a comment in today's Crain's Chicago Business in response to the circulation declines in the two Chicago papers. I think it's revealing.

"I read the papers for the news - and I have time on the commuter train. I buy the paper for the features - the comics, the puzzles, the sports, and the arts. I read the out of town paper headlines on-line. My subscriptions are a third of my cell phone bill but deliver a huge value over that hyped up 'garage door opener.'"

6:22 PM  
Anonymous Anonymous said...

Rick is correct. Subscriptions are delivered to households, not population. And, if you use population at all, it should be adult population not total population.

7:26 PM  
Blogger Steve Ross said...

Come on folks. Circulation dropped in small part because people can't afford the paper and in large part because newspapers simply stopped promoting.

This is a time-honored way to conserve cash in the publishing business, and newspapers HAD to conserve cash or die in the first six months of this year. Papers are just beginning to spend on circ promotion again as cash flow has improved a bit and advertising volume has stabilized in many places.

BTW, official morning daily (and Sunday) circ rose until 2006 and then started falling. It really started falling a few years earlier, as circ promo was cut back and papers falsified their circulation figures. SHARE (percent of households taking a daily paper) has been falling for more than 30 years -- the advent of the Internet and Craigslist had zero effect on the trendline. Suburbanization killed off the afternoon papers and that's where the circulation loss has been.

The numbers are there for all to see.

7:41 PM  
Anonymous Anonymous said...

All,
ABC is publicizing PAID circulation only....these totals do not include the true readership and audience figures from their websites.

5:50 AM  
Blogger yelvington said...

In addition to the factors already mentioned, many daily newspapers have intentionally reduced their circulation footprint.

This may seem counterintuitive to people who assume bigger circulation/revenue numbers are better. They are not better if they bring even bigger expenses.

Even though newsprint consumption is down more than 30 percent this year, the mills are hiking their prices again.

Manufacturing and distribution for fringe circulation areas that don't contribute materially to the core advertising revenue model just doesn't make economic sense. So publishers, faced with unrelenting demands for margin and cash flow, take the rational step of restricting circulation.

5:51 AM  
Anonymous RPM said...

Al Cross: Thanks for keeping the Newsosaur, and his vested interested in the failure of print, honest. Weeklies are fine. You nailed it.

6:06 AM  
Anonymous B Rosenbaum said...

The question why circulation has dropped strikes me as far less important than the question whether newspapers can get it back. And I doubt they can; there are just too many entrenched players competing for the consumer's attention.
Let's face it: the role newspapers play in people's lives has evolved since the '40s. At the time, newspapers were about the only source for timely local information -- not just news but advertising too. You can't blame them for losing that unique position; it's the outcome of societal and technological change. But they can never regain it either -- any more than a horse could regain its position as a primary mode of transportation. The question is how can newspapers now protect the role they do have to maintain circulation where it is, and how can they define some new roles to start building circulation under new-and-improved terms.

6:46 AM  
Anonymous Anonymous said...

I think your math is terribly wrong. You are mixing population and households. While the numbers are awful, they are not as bad as your math. Circulation is a function of households, which based on an estimated 115M in the U.S. would put daily penetration at 34% and Sunday penetration at 35%. You must use readership numbers when population is the denominator (virtually no one orders two subscriptions while in many cases multiple people read the copy delivered). I am shocked a journalist would make such a basic mistake. The numbers are not good, but certainly not as bad as your math suggests.

7:11 AM  
Blogger Steve Ross said...

Newspapers are (merde!) subject to the laws of economics. You raise prices, you lose customers. You cut quality, you lose customers! You don't market yourself, you lose customers!

Oh, the Internet did it!

Arrgh.

9:32 AM  
Blogger Tim Night said...

Let's check your math here. You're saying that newspaper penetration was 28.5% in 1940 and 13.5% penetration for a population base that more than doubled. Basically newspapers are selling the same number of copies today as they did 70 years ago. Pretty good considering how many competing media outlets there are out there. Besides, you're looking at subscribers as opposed to readers. If you look at readership, you will realize that that newspaper readership penetration is actually 2.5x higher than the household penetration numbers that you present. Another person brought up a good point, why are you measuring against total population? You also need to take natural migration to the web into consideration. A lot of people are still reading the paper on newspaper websites. ABC should count them but doesn't. That's all about to change when newspapers start charging readers to access their content. Newspapers are also going to require that people register to access content on their website. This will eventually lead to a more qualified, local reader...resulting in a more desirable, measurable target for advertisers.

5:41 PM  
Blogger Tim Night said...

Also, not to be crass but..if you can't afford a $100/year subscription, you have problems. The value of the coupons, deals and advertisements pay for the price of the paper ten fold each week. Believe it or not the majority of people surveyed, buy it for the advertising as much as the content!

5:52 PM  
Blogger Steve Ross said...

In 3Q 2007, just as the recession was starting, advertisers were willing to pay almost $900 per print paid subscriber per year (on average, nationwide, for dailies and Sunday papers) -- up 16% (after taking inflation into account, using CPI-U) from 1994. Take THAT Internet!

Subtracting B-to-B ads (mainly employment classified) you get about $750 for B-to-C. That squares well with a 7-10% marketing cost for something like $10,000 worth of good and services. And THAT is just about average household discretionary income for food vs restaurant and consumer goods. Those kinds of numbers, and the fact that few newspapers are sold on newsstands today, and that newspaper pass along from household to household is likely to be low in suburban households (at least) suggests that the industry is blowing smoke when it thinks each newspaper is read by more than one household. Reading by two or more in the same household doesn't excite advertisers as much -- same pool of money available to buy stuff.

But why didn't newspapers think of new ways to get ad dollars, ways that created entirely new revenue streams by creating entirely new business plans? Google did it, with pay-per-click and in-context ads... and generates $20 billion a year -- not by "stealing" it from other media but for the most part by creating new selling propositions.

7:12 PM  
Blogger Robert H. Heath said...

Ironically, only a few months ago, the CJR published this article celebrating the fact that circulation revenue would soon surpass ad revenue at the NYT for the first time.

Hmmmm... when the good news is that circulation is falling less fast than ad revenue, there is no good news.

The newspaper business is caught in a vicious cycle which is reversing 100 years of structural advantages it has enjoyed.

For more detail go here.

9:15 AM  
Anonymous Anonymous said...

All good info here. Couple of HUGE points that many of you completely missed. First of all, there has been an obvious slant of many newspapers that people are frankly tired of. Why (over)pay for a newspaper when you can predict the position they take(which they never should) when they "report" on a story. In addition, let's not forget the timing of news and how quickly things are reported now. Who wants to read tomorrow's news when they can get it today. This is simply progress. Thank God for technology and COMPETITION. The numbers do not lie and to say that 13.5% is good is wishful thinking. Newspapers are getting hammered for good reason. Even if you are in the newspaper business, you have to admit, things will be VERY different in the next 5 years. If you want people to pay for subscriptions online(long term), get ready to either improve your reporting or charge $2 per month, not $15...

2:18 PM  
Blogger Robert H. Heath said...

Mr. Mutter -

Your post inspired me to take a look at some longer-term trends in U.S. newspaper circulation which I've posted here.

As I've referred to your research, I was hoping you could confirm I've used your numbers correctly.

Thanks.

-rhh

8:08 PM  

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