Trends in News Revenue:The view from 30,000 feet (with a detour)

Jesse HolcombSenior Researcher, Pew Research Center

@jesseholcomb │pewresearch.org/journalism

June 30, 2014 2www.pewresearch.org

“Tell the truth and trust the people.”

–Joseph N. Pew Jr.

June 30, 2014 3www.pewresearch.org

Advertising still dominates

• Nearly two-thirds of total news revenue

• Mostly print ($25 billion from daily

newspapers)

• $13 billion from TV news

June 30, 2014 4www.pewresearch.org

But things have changed

• Total news revenue in 2006:

$95 billion

• Today: $63-$65 billion

• Audience and non-traditional

revenue has grown as a

share of the total

June 30, 2014 5www.pewresearch.org

Growth in audience revenue

• Newspaper circulation revenue up in 2013

- 2nd straight year of growth after decade of decline

• Retransmission fees on the rise

- Now make up 2/3 of CNN U.S. revenue

• Public radio individual giving has grown

- 2012 was second-biggest year since tracking began

June 30, 2014 6www.pewresearch.org

Is it sustainable?

• Pay TV Industry – Reached a peak

- Shed 251k subscribers in 2013; first full-year loss

- Average expanded basic cable bill: $61 and rising

• Newspapers – Shrinking base of paying audience

- Total weekday newspaper subs are flat at 44 million

(down from 55 million in 2004)

- Newspapers raising rates; more paywalls (500 &

counting)

June 30, 2014 7www.pewresearch.org

That’s a question nonprofits are asking, too

June 30, 2014 8www.pewresearch.org

Filling the gaps

• Identified 172 digital

nonprofits around the

U.S. (and 24 that closed

between 2008-12)

• Heavy focus on state,

metro coverage

• Just ¼ cover general

interest; rest are

investigative & topically

focused

June 30, 2014 9www.pewresearch.org

The survey

• We secured participation from 93 outlets (54% response rate)

• Asked 47 questions on the following:

- Hard financial data (revenues totals and revenue streams)

- Staffing, expenditures and knowledge about business

- Attitudes about the economic environment for a nonprofit

June 30, 2014 10www.pewresearch.org

Diversifying revenue streams

June 30, 2014 11www.pewproject.org

But philanthropy plays major role

• Foundations account for

67% of nonprofit revenue

• Individual giving: 24%

• But: Pew Research and

Knight data suggest

individual giving is rising

as share of revenue

June 30, 2014 12www.pewresearch.org

For some, diversifying is a luxury

“We have four employees,

and I wish [reducing reliance

on] foundation money was a

bigger problem for me.”

– Brian Wheeler,

Charlottesville Tomorrow

June 30, 2014 13www.pewproject.org

A fragile enterprise

• 78% of digital nonprofits have 5 or fewer full-time staff

• 47% are generating $250,000 or less each year

• $750,000: The cost to produce ProPublica’s

Tylenol/acetaminophen investigation

• Roughly two dozen digital publishers/websites have closed or

gone dormant in past five years

June 30, 2014 14www.pewproject.org

But publishers are tenacious

June 30, 2014 15www.pewproject.org

Catch-22

• Many lack business-side resources to invest in sustainability

• Nonprofit culture: invest in programs

• Vast majority of nonprofit publishers say business/fundraising

accounts for less than ¼ of staff time

June 30, 2014 16www.pewresearch.org

“We don’t have time, and we don’t know how.”

June 30, 2014 17www.pewproject.org

What next?

• What’s the long-term role of philanthropy?

• Will community engagement translate to financial support?

• Will newer/experimental revenues continue to grow?

• What role will partnerships, mergers and networks play in

sustainability?

Trends in News Revenue:The view from 30,000 feet (with a detour)

Jesse HolcombSenior Researcher, Pew Research Center

@jesseholcomb │pewresearch.org/journalism