Advertising
Chart: The Slow Death of Traditional Media
The Slow Death of Traditional Media
Desperation time as old guard clings to falling market share
The Chart of the Week is a weekly Visual Capitalist feature on Fridays.
Bill Gates once famously said that we systematically overestimate the change that will occur in two years, while underestimating the change that will come in the next ten.
The ongoing conversation about the death of legacy media definitely fits that mold.
Over the last five to ten years, people have been talking about how the newspaper, magazine, or radio station would become all but obsolete. And while certainly things have changed in all of these industries, it’s clear that there has not been a full paradigm shift yet.
Here is the evidence that we have finally reached that inflection point.
Fixing the Plane
In a recent interview at the City University of New York’s journalism school, Ken Lerer described the challenges of traditional media as follows:
You have to fix the plane while you’re flying it.
Lerer, a co-founder of the Huffington Post and currently the Chairman for Buzzfeed, is alluding to the fact that legacy media has to maintain old business models based on subscription and print ad revenue, while successfully venturing into the digital world. The latter category is already hard enough, even without taking into account the balancing act of the former.
The moral of the story? Some of these “planes” are going to land safely, but most of them are going to crash and burn.
The cost structure of legacy media just doesn’t make sense in today’s digital world. Overhead is high, and revenue is harder to find due to the limited success of paywalls, rampant ad blocking, and the steady fall in display ad prices due to the emergence of programmatic bidding.
Legacy Revenues
Why has legacy media been so slow to adopt change? Why don’t they just lay off half of their staff, ditch print operations, and start from scratch?
It’s because their major revenue sources are as slow at adopting as they are.
In 2015, there was only one age demographic with more than half of its constituents reading a daily newspaper, and that was “65 years old and up”:
That said, the people that still read newspapers are among the wealthiest people in the country. Warren Buffett, for example, reads five a day. But even he does not know how to save the print industry from its woes.
Meanwhile, Madison Avenue has been notoriously slow at evolving to meet the needs of the digital revolution. If the biggest advertisers are still demanding the status quo, it makes it very difficult to “fix the plane”.
New Models
The most noticeable signal of change, however, is the relative success of new media companies such as Vice, Buzzfeed, and Vox – and the fact that some of their largest backers are from the old guard.
All of the above companies are “unicorns” valued at $1 billion or more by private investors, which include venture capital stalwarts such as Andreessen Horowitz, Accel Partners, Khosla Ventures, RRE Ventures, or Lerer Hippeau.
More importantly, however, they’ve also posted strategic investments from legacy media companies that are trying to wisely hedge their bets. Some of these include NBC Universal, The Walt Disney Company, 21st Century Fox, and Hearst.
Digital will become the largest channel for ad revenue globally by 2019 – investors and companies that believe in the media business should position themselves accordingly.
Advertising
Charting Revenue: How The New York Times Makes Money
This graphic tracks the New York Times’ revenue streams over the past two decades, identifying its transition from advertising to subscription-reliant.

When it comes to quality and accessible content, whether it be entertainment or news, consumers are often willing to pay for it.
Similar to the the precedent set by the music industry, many news outlets have also been figuring out how to transition into a paid digital monetization model. Over the past decade or so, The New York Times (NY Times)—one of the world’s most iconic and widely read news organizations—has been transforming its revenue model to fit this trend.
This chart from creator Trendline uses annual reports from the The New York Times Company to visualize how this seemingly simple transition helped the organization adapt to the digital era.
The New York Times’ Revenue Transition
The NY Times has always been one of the world’s most-widely circulated papers. Before the launch of its digital subscription model, it earned half its revenue from print and online advertisements.
The rest of its income came in through circulation and other avenues including licensing, referrals, commercial printing, events, and so on. But after annual revenues dropped by more than $500 million from 2006 to 2010, something had to change.
NY Revenue By Year | Print Circulation | Digital Subscription | Advertising | Other | Total |
---|---|---|---|---|---|
2003 | $623M | $1,196M | $168M | $1,987M | |
2004 | $616M | $1,222M | $165M | $2,003M | |
2005 | $616M | $1,262M | $157M | $2,035M | |
2006 | $637M | $1,269M | $172M | $2,078M | |
2007 | $646M | $1,223M | $183M | $2,052M | |
2008 | $668M | $1,068M | $181M | $1,917M | |
2009 | $683M | $797M | $101M | $1,581M | |
2010 | $684M | $780M | $93M | $1,557M | |
2011 | $659M | $47M | $756M | $93M | $1,555M |
2012 | $681M | $114M | $712M | $88M | $1,595M |
2013 | $673M | $151M | $667M | $86M | $1,577M |
2014 | $668M | $172M | $662M | $86M | $1,588M |
2015 | $653M | $199M | $639M | $89M | $1,580M |
2016 | $647M | $232M | $581M | $94M | $1,554M |
2017 | $668M | $340M | $559M | $109M | $1,676M |
2018 | $642M | $400M | $558M | $148M | $1,748M |
2019 | $624M | $460M | $531M | $198M | $1,813M |
2020 | $597M | $598M | $392M | $196M | $1,783M |
2021 | $588M | $774M | $498M | $215M | $2,075M |
2022 | $574M | $979M | $523M | $233M | $2,308M |
In 2011, the NY Times launched its new digital subscription model and put some of its online articles behind a paywall. It bet that consumers would be willing to pay for quality content.
And while it faced a rocky start, with revenue through print circulation and advertising slowly dwindling and some consumers frustrated that once-available content was now paywalled, its income through digital subscriptions began to climb.
After digital subscription revenues first launched in 2011, they totaled to $47 million of revenue in their first year. By 2022 they had climbed to $979 million and accounted for 42% of total revenue.
Why Are Readers Paying for News?
More than half of U.S. adults subscribe to the news in some format. That (perhaps surprisingly) includes around four out of 10 adults under the age of 35.
One of the main reasons cited for this was the consistency of publications in covering a variety of news topics.
And given the NY Times’ popularity, it’s no surprise that it recently ranked as the most popular news subscription.
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