Digital is not rescuing troubled US newspapers

The grim news for newspapers: digital is doing little to rescue them from their deepening woes.
Reeling from weak circulation and ad revenue, the traditional newspaper world faces an ugly picture while social media and tech firms benefit from the shift to digital, a Pew Research Center study released today found.
Average weekday newspaper circulation - print and digital combined - fell seven per cent in 2015, the greatest decline since 2010, Pew's annual "State of the News Media" report found.
Although digital circulation gained a slight two per cent, that amounted to just 22 per cent of total circulation, and online subscriptions have done little for the overall revenue picture, Pew said.

It found that total 2015 advertising revenue among publicly traded newspaper companies declined almost eight per cent, reflecting weakness in digital as well as print.
To make matters worse, newspaper newsroom employment fell 10 per cent last year, the biggest drop since 2009, the researchers found.

"Newspapers had a near recession-level year," Pew researcher Jesse Holcomb said.
Major tech companies are reaping most of the revenues from online news, Pew found.
"There is money being made on the web, but news organizations have not been the primary beneficiaries," the report said.
Total digital advertising spending grew 20 per cent last year to around USD 60 billion, a higher growth rate than in 2013 and 2014, Pew said.

"But compared with a year ago, even more of the digital ad revenue pie -- 65 per cent -- is now swallowed up by just five tech companies," the report said, naming Facebook, Google, Microsoft, Yahoo and Twitter.
"Increasingly, the data suggest that the impact these technology companies are having on the business of journalism goes far beyond the financial side to the very core elements of the news industry itself."
Facebook took in some 30 per cent of digital display ad revenue last year, or USD 8 billion, according to Pew. Google accounted for 16 per cent.
Some news publishers still make profits "but it's a mixed picture," while a handful of digital companies "are sucking up the oxygen," Holcomb said.

Part of the reason for the revenue shift is due to how people discover news -- often by happenstance on social networks or by searching online -- the researcher added.