Internet Impact on the Top 10 Newspapers from 2002 to 2010: A Backwards and Forwards Look

The trend from print to the Internet is changing the way news works. We seem to be in the middle of it now. The Rasmussen reported on June 1, 2010 that 63% of Americans still like to get their news in print. This figure is down by six points from a year ago. In the same survey, 26% of Americans say they prefer to get their news online and 11% still aren't sure. (Rasmussen Reports)

What is changing is that about 40% of American's say they don't buy a newspaper, and 53% say they are on the Internet at least daily, some several times a day. (Rasmussen) What has the last decade been like, and where is the newspaper industry going?

What was it like about 8 years ago?

As a testament to the changing industry, the following is a comparison looking backwards in time of the Top 10 newspaper companies in 2003 and 2002, to where they are at now with their 2009 annual reports, and plans for 2010.

The original data that was used was gathered from Greg Downey's Top 25 Newspapers article listed at the Wisconsin's University of Journalism but the focus was scaled back compare only the top 10.

At the time, Downey looked back from September 22, 2004 to the beginning of 2003 and then back to 2002. His comparison included newspaper's rank in the industry, the news media company's net worth and revenue, as well as circulation numbers of their top publication.

In preparing this report, it was recognized that a) the mergers, acquisitions and buyouts would be time consuming to research for this article for a newbie, and b) the numbers published do not reflect the changing times of Internet reading.

That being the case, this article focuses on looking at these "Top News Media" companies, their financial statements and current vision for the future.

#1 News Media Outlet - Gannett Co - USA Today

The number one company in 2002 and 2003 was the Gannett Co., which reported operating revenue at $5,610 with 'USA Today' circulation at 2,251,035. In 2009, according to the Gannet Co's Annual Report '09, operating revenue was $5,613M, which is roughly where they were back in '03.

What is their focus now? "From text messaging to e-readers, Gannett is connecting consumers to what they want and advertisers to consumers. In 2009, we launched several mobile products with USA TODAY. PointRoll and USATODAY continue to work closely, bringing the latest in rich media advertising to the fast-growing mobile market. Gannett Broadcasting is a major player in the emerging Mobile DTV technology which extends the reach of local broadcast sites by making local, digital TV portable.

"We now have more than 100 digital communities that reach and engage 26 million people monthly. Our MomsLikeMe.com social networking site is a great example of the loyalty consumers develop with these communities. MomsLikeMe.com, which has 80 local online communities and had 854,000 unique visitors in January 2010, is one of the fastest-growing social media networks for moms and the leading local mom social media site."

• USA TODAY remains number one in total daily print circulation in the United States.

• According to the Audit Bureau of Circulations' FAS-FAX report, USA TODAY's daily print circulation was 1,891,604 for the period ending September 30, 2009.

• USA TODAY is newspaper leader in single-copy newsstand volume, selling more than 475,000 copies per day.

• USA TODAY's subscription copies are up 1.3% versus September 2008, to 297,414 daily.

• USA TODAY boasts the largest average-issue print audience of any national newspaper, with 3.7 million readers daily. (September 2009 ABC FAS-FAX; MRI Fall 2009)

#2 News Media Outlet - Los Angeles Times (Tribune)

Back in 2002 and 2003 the Tribune Co. ranked number 2 in news media outlets, with revenue at 4,017M, and the Los Angeles Times servicing 983,727 subscribers.

According to Business week, "the company was founded in 1847 and is headquartered in Chicago, Illinois. As of December 20, 2007, Tribune Company was taken private. On December 8, 2008, Tribune Company, along with its affiliates, filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware. (Business week)

#3 News Media Outlet - New York Times

In 2002 and 2003, The New York Times Co. ranked third with revenue listed at $3,008M and The New York Times listing 1,133,763 subscribers.

According to the 2009NYTimes annual report, "Total revenues in 2009 were $2.4 billion, a decrease of 17% from $2.9 billion in 2008. In the face of the widespread advertising downturn, our revenues from advertising, our primary revenue source, fell 25%. This was offset in part by a 3% increase in circulation revenues, which are derived from home-delivery and newsstand sales."

Business week said, "While the Time's appears to be regaining its stride journalistically, it has not been rewarded with circulation gains. In 2004, the paper posted an infinitesimal 0.2% increase in the circulation of both the daily edition, which now stands at about 1.1 million, and the Sunday paper, which is just under 1.7 million. Since the national expansion began in 1998, the Times has added 150,000 daily subscribers outside New York but is thought to have lost about 96,000 subscribers in its home market.

The net increase of 54,000 represents a 5.1% uptick, which compares with the 3.5% decline in U.S. daily newspaper circulation over this period. What's more, the Times posted its gains despite boosting the price of a subscription by more than 25% on average. (Business Week: The Future of New York Times)

# 4 News Media Outlet - Knight Ridder - Philadelphia Inquirer (Now Philly Daily News)

Knight Ridder ranked fourth on the list of the TOP 25 back I n2002 and 2003 with revenue at $2,768M and the Philadelphia Inquirer boasting a circulation of 387,692 subscribers.

Knight Ridder (pronounced /ˈrɪdər/) was an American media company, specializing in newspaper and Internetpublishing. Until it was bought by The McClatchy Company on June 27, 2006, it was the second-largest newspaper publisher in the United States, with 32 daily newspapers. (Wikipedia)

#5 News Media Outlet- Advance Publications -The Star Ledger

Ranking 5^th, Advance Publications was netting $2,128M in revenue and The Star Ledger (Newark, N.J.) published its subscribers at 407,945.

Advance Publications, Inc., is a privately held communications company that, directly or through subsidiaries, owns Condé Nast Publications, Parade Publications, Fairchild Publications, American City Business Journals, the Golf Digest Companies, and newspapers in more than twenty-five American cities; Advance Publications' subsidiaries also have extensive interests in cable television, as well as in Internet sites which are related to its print publications

In 2008, 40% of the Staff at Star Ledger was to leave to prevent a buy-out and Jim Willse the Editor-in-chief said, "The task now is to figure out a way to make a good newspaper with a 40% smaller staff." (WSJ)

#6 News Media Outlet - Hearst Corp. - Hearst Newspapers

In 2002, the Hearst Corp. ranked 6^th and in 2003, they ranked 7^th. Their net was $1,458M and the Houston Chronicle had 549,300 subscribers.

According to the Hearst 2009 Annual Review, Hearst has a strong magazine business with names like Cosmo, Country Living, Esquire, Food Network, Good Housekeeping, House Beautiful, Harper's Bazaar, Marie Clark, O, the Oprah Magazine, Popular Mechanic, Red Book, Town and Country and Veranda. Other subsidiary names that are popular include Gazilla, MobiTV, and Pandora.

Their annual report says, "Choosing highlights this year is difficult. For most print media, 2009 was an annus horribilis, with many observers questioning the future of newspapers and magazines. In our case, we are not mindless about the challenges, but we have made genuine progress in building new business models for these operations. Hearst Newspapers is finding a new model by asking core readers to pay more for news that was undervalued for too long." (Hearst Annual Report)

#7 News Media Outlet - Cox Co - The Atlanta Journal

Cox beat out Hearst for the number six ranking in 2003. They reported revenues of $1,400M with The Atlanta Journal- Constitution servicing 401,077 paid subscribers.

In 2009 Cox Co had 15 Billion in revenues Cox Financial Information.

#8 News Media Outlet - Dow Jones & Co - The Wall Street Journal

In 2002, and in 2003, the Dow Jones & Co. ranked number 8, netting $1,227M and servicing 2,2010,017 customers with The Wall Street Journal.

The Dow Jones History shows "that a decade before the Internet, Dow Jones was storing and coding its news digitally so that it could be accessed online. Factiva's content and technology tools set the standard for innovation and quality in the news and information industry. The Journal, Newswires and Dow Jones Indexes built successful franchises in Europe and Asia. Dow Jones History

The Consumer Media Group delivers high-quality branded business news, information and services to some 14 million high-demographic, engaged consumers how, when and where they want it. The Wall Street Journal is the flagship, founded in 1889 and redesigned in print and online for the Digital Age in 2007.

By 2006, the Wall street Journal had edged its way to number 2, with 2,058,42 subscribers and by 2008, it rose to number one. It slid back one spot to rank by 2009.

#9 News Media Outlet - the McClatchy Co

In 2002, and 2003, the McClatchy Co. ranked number 9 with $1,098 net profits and just 377, 058 subscribers for the Star Tribune (Minneapolis).

The McClatchy Company's 2009 Annual Report states, "In 2009 our revenues were down 22.6%, with advertising revenues down 27.1%. The decline in ad revenues was partially offset by 4.8% growth in circulation revenues. Income from continuing operations was $60.3 million, or 72 cents per share, compared to $2.8 million, or three cents per share, in 2008. This company acquired Knight Ridder, which should have improved their ranking. (McClatchy Co Annual Report)

#10 News Media Outlet- the Washington Post

Back in 2002, and 2003, the Washington Post Co. was showing $873 3.7M net revenue, and it listed 772,553 subscribers.

According to their 2009 Annual Report., the Post is in the education and media businesses primarily with the Washington Post and Newsweek being their primary publications, and with the Kaplan Online University being their primary educational business. They also operate CableOne, own several newspapers, have television broadcasting stations and Magazines.

To compare the medium changing trends for the Post in 1991, 82% of the business revenues were from newspaper, magazines, and local television news. In 2009, only 25% of the business revenues were from these mediums, with education moving into the dominant category at 58%. For 2009, the Post reported operating revenue of $4.5B will a net profit of 194M. (Post Annual Report)

Summary of newspaper and news media changes

In compiling this report, it was evident that the metrics need to be changed, comparing apples to oranges doesn't make sense. While print subscriptions are dropping, the Internet medium is exploding. The industry is more competitive than it ever was, but there are more options for the readers than ever before too. How do newspapers and magazines stay in business, still service their readers, and make advertising money that has traditionally paid for their content?

The Media Daily News on 4/23/2010 reported that ABC will begin auditing newspaper readership on Mobile. ABC President Michael Lavery explained, "With all the buzz around the iPad, and with use of mobile browsers exploding, newspapers and their advertisers are increasingly interested in seeing mobile metrics detailed in ABC reports.

A new report from Borrell Associates predicts that mobile advertising and marketing will grow to become a $54 billion market in the U.S. by 2014, representing a cumulative annual growth rate of 84% over the next four years. (Media Daily News)

Sources:

Rasmussen, 63% of Americans still like to get their news in print
Company websites and their 2009 Annual Reports
Greg Downey, Top 25 Newspapers, 2004 Wisconsin's University of Journalism
Media Daily News