For long-term prospects of quality journalism, read the last para.
UK and US see heaviest newspaper circulation declines
By James Robinson/Guardian
UK newspapers have suffered the most dramatic circulation declines of any country outside America since 2007, according to the Organisation for Economic Cooperation and Development. A detailed study published by the OECD paints a bleak picture of the industry.It found that UK circulation has fallen by 25% between 2007-09, second only to the US, where the decline was 30%. Greece (20%), Italy (18%) and Canada (17%) have also seen significant falls. The report, The Evolution of News and the Internet, found that 20 out of 30 OECD countries faced declining newspaper circulations.
The growth of the global newspaper market slowed progressively from 2004 to almost zero in 2007, the OECD said, and has shrunk since 2008 – falling by 5% in that year – despite growth in countries in the developing worlds. The falls were most pronounced in North America, which saw drops of 14% in 2008 and 18% in 2009.
About half of OECD countries experienced drops below 2004 levels, with the United States (-34%), the United Kingdom (-22%) and Japan (-18%) the worst hit. The OECD reports that job losses in newspapers have "intensified" since 2008, particularly in the UK, US, the Netherlands and Spain.
Over the 10 years from 1997-2007, it says, the number of jobs in the US has fallen from 403,355 to 356,943, a fall of 12%. The decline has accelerated drastically since then. The study says that newspapers are unlikely to disappear, however.
The study also found that more than half the population read news online in some OECD countries, including Korea, where 77% do so. Despite that, "the willingness to pay for online news remains low". It points out that: "The specialised press performs better than general newspapers", online, citing the Wall Street Journal as an example. Its also concludes: "Reading news online complements other forms of news rather than replacing it."
The global newspaper market generates 57% of revenue from advertising, the OECD said, although that figure is far higher in many developed countries, most notably in the US, where newspapers are reliant on advertising for 87% of their income.The figure is 50% in the UK, according to the OECD, and lowest in Japan (35%), which has some of the world's bestselling newspapers and the highest levels of newspaper penetration.
Online advertising revenues accounted for a "minuscule" proportion of total newspaper revenues – just 4% in 2009.
The study includes an analysis of the methods used in some OECD countries to try to support newspapers, including state subsidies and moves to protect newspaper content.
The report concludes that "no business and/or revenue sharing models have been found to finance in-depth independent news production. This raises questions as to the supply of high-quality journalism in the longer term."