You Might As Well Go With Pay Walls: Online Newspaper Revenue Really, Really Bad

When news orgs realized that something was going to have to be done about the Internet and kids these days being able to read any damn thing they wanted on it, several different tactics were broached in order to make journalism on the web profitable. So far, none of them have really worked: The best pay wall scenarios you get are Rupert Murdoch‘s The Wall Street Journal, which has more than its fair share of chinks in its armor, and the iPad threatens to make buying subscriptions on your Kindle pointless. So that leaves good, old-fashioned ad revenue…how media companies traditionally defined their profits. Except the current numbers aren’t looking so great.

Companies like Scripps and The Washington Post Co. have posted some pretty atrocious Q4 earnings (which they certainly took their time in making public), but it maybe even worse than it looks. According to Nieman Journalism Labs, Scripps tried to blame their bad Internet ad sales on their print problems…which makes little to no sense.

(Said Scripps:) ‘The decline in online revenue…is attributable to the weakness in print classified advertising, to which roughly half the online advertising is tied.’ …Essentially, it’s revenue from “upselling” or “value added” programs for print advertisers; it disappears when the print ad disappears; and those print ads could probably be sold for the same price without the incentive of the online upsell.

So basically online advertising exists only to sweeten the deal for agencies looking to buy into print. And with more and more magazines and newspapers deciding to go behind pay walls and make that trade-off between more subscribers and less unique monthlies, we can expect to see these numbers only get worse as advertisers wonder if its even worth reaching such a smaller audience.