Canadian newspapers avoid US-like decline

The revenue picture for Canada’s daily newspapers remained stable through 2007, with robust growth in online ad sales offsetting a mild decline in print advertising. This is in sharp contrast to the US, where a contracting economy helped drive print ad revenues to the biggest year over year fall in more than half a century.

According to new data released by the Canadian Newspaper Association (CNA) on Monday, the total 2007 revenues for Canadian newspapers, including online operations, were marginally lower (-0.8%) dipping to $3.576 billion. The slightly sharper decline in print advertising (-2.4%) was offset by vigorous growth in online revenues (+29%). Circulation sales were also down slightly, to $808.9 million, a drop of 1.2% over 2006, a year in which circulation sales posted a 3.8% gain.

This picture contrasts markedly with the performance of the US newspaper industry, where total print advertising revenues in 2007 fell 9.4% to $42 billion, according to the Newspaper Association of America (NAA), the biggest year-over-year decline since 1950, when the NAA first began charting the numbers.

NAA said online revenue growth softened substantially, increasing by only 18.8% in 2007 (compared to 31.4% in 2006), ten points lower than the rate of growth in Canada in the same year. “The narrative about newspapers in the US has been consistently negative in recent years, and that negativity has unduly influenced perceptions of the health of the newspaper industry in Canada,” said Anne Kothawala, President and CEO of the Canadian Newspaper Association.

"Advertisers and their agencies, many of whom are global businesses, should ensure that their Canadian buying decisions are not tainted by the US data. In an age when consumers are increasingly tuning out advertising content, studies show they continue to find newspapers engaging. Many readers turn to their paper as much for the ad content as the editorial content."

“The real story is how well we are holding our own in an age of global media disruption,” she said. Recent NADbank readership data released on March 5, and a Statistics Canada report on the industry in 2006 released on April 1, support the CNA’s analysis, Kothawala said.

CNA data were collected by Borrell Associates, a renowned research and consulting firm with offices in Toronto, Seattle and Williamsburg, Virginia. The 2007 report contains revenue results from circulation, print and online activities from 93 daily newspapers, representing over 95% of daily circulation in Canada. Borrell will provide updates to CNA on a quarterly basis throughout 2008.

 
 
Date Posted: 8 April 2008 Last Modified: 8 April 2008