Inflation-adjusted newspaper print advertising revenues now below 1950 levels

Can you say “dying industry”? How about “creative destruction”? You are reading this news on a digital platform, and that is, in short, why the newspaper industry, not so long ago the monarch of news dissemination in the United States, is on the way out. Well, to be more accurate, actually Craigslist is even more important, having decimated classified advertising, by far the most lucrative market of the traditional newspaper, and now a rapidly fading memory. How ironic that a website with a peace logo is destroying the mainstay of the left-leaning mainstream media.

Mark Perry has been keeping track of the newspaper industry for the American Enterprise Institute, and his latest report makes fascinating reading. First, the compelling graphical representation of the data he offers:

Note that data began being collected in 1950, so today's data are actually the lowest in history. Further note that in 1950, the poulation of the United States was about 180 million people, versus 330 million or more today.

An excerpt from his report:

it’s possible that the attention the ad revenue charts were generating on the Internet may have contributed to the decision by the Newspaper Association of America (NAA) last year to suddenly stop its long-standing practice of reporting quarterly advertising revenue data and switch to releasing only annual data. In a 2013 interview, NAA CEO Caroline Little was quoted as saying that she and the organization’s board decided it was “time to stop beating themselves up four times a year with the negative numbers.”

Without access to quarterly data, I’ll now only be able to update the charts and report newspaper ad revenue once a year when annual data are released in April by the NAA, which just released itsad revenue figures for 2013. The updated chart above shows annual data from 1950 to 2013 in inflation-adjusted (2013) dollars. The blue line represents total annual print newspaper advertising revenue (for the three categories national, retail, and classified), and appear in the chart as billions of constant 2013 dollars. Newspaper print advertising revenues of just $17.3 billion in 2013 fell to the lowest level of print advertising since the NAA started tracking industry data in 1950. In constant 2013 dollars, advertising revenues last year were $2.7 billion (and 13.5%) below the $20 billion spent in 1950, 62 years ago. Print advertising last year was almost $2 billion below the level of $19.2 billion in 2012, which was the first year that print advertising revenues fell below the 1950 level.

The decline in print newspaper advertising to a 63-year low is pretty amazing by itself, but the sharp decline in recent years is stunning. Newspaper print advertising revenues decreased more than 50% in just the last five years, from $37.6 billion in 2008 to only $17.3 billion last year; and by almost 70% over the last decade, from $56.9 billion in 2003.

Here’s another perspective: It took a half century for annual newspaper print ad revenue to gradually increase from $20 billion in 1950 (adjusted for inflation in 2013 dollars) to $65.8 billion in 2000, and then it took only 12 years to go from $65.8 billion in ad revenues back to less than $20 billion in 2012, before falling further to $17.3 billion last year.

Hat tip: Lee Cary