By Ryan Chittum
cjr.org

A person buying the paper brings twenty times the revenue of an online reader

After posting the unhappy news that newspaper ads are at 1965 levels, I thought it might be interesting to take a look at how much revenue newspapers get from their print readers versus their online ones. It offers a reality check as newspapers try to figure out where to go from here.

Print newspapers took in $34.7 billion in ad revenue last year and had 49 million subscribers. That works out to $709 per subscriber (Unlike my “1965” post, I’m not using Alan Mutter’s 2009 estimates, $28.1 billion, since I don’t have an estimate on 2009 circulation. Using his ‘09 estimate, the print figure drops to $573 per subscriber. But total subscribers will fall, too, by an as-yet-undetermined amount. If they fall 4 percent, that will work out to about $603 per subscriber).

Newspapers online had $3.1 billion in ad revenue last year and averaged 67.3 million unique visitors per month. That’s $46 per reader.

$709 (or even $603) versus $46. And you wonder why newspapers still like their print products.

But that doesn’t even tell the whole story, because, recall, newspapers still cling to that 19th Century business model known as getting customers to pay you money. Alas, the most recent data I can find on industrywide circulation revenue is from 2004, and the Newspaper Association of America hasn’t returned my calls or emails.

So let’s go with that 2004 number, which was $11 billion. Yes, I know circulation has declined 11 percent since then, but I’m making a somewhat-educated guess that increases in newsstand and subscription prices have offset that—at some major papers, circulation revenues have actually been growing while circulation itself declines.

Add that circulation revenue to ads and the print newspaper had about $45.7 billion in revenue last year. That works out to $940 per subscriber ($834 under Mutter’s 2009 estimate and the guesstimated 4 percent circulation decline).

To repeat: $940 per print subscriber versus $46 per online reader. $45.7 billion versus $3.1 billion. That means a print subscriber is worth more than 20 times the revenue an online reader is. . . READ FULL STORY