oecd

Newspapers survive financial fallout by cost-cutting

A recent report issued by the OECD paints a gloomy picture for the future of newspapers. However, according to The Economist, the publisher of Bild and Die Welt “recently recorded the most profitable first quarter in its history”, with a profit margin showing a startling 27%. Maybe that’s good news for the German publisher but it is an exception as declining readership, especially amongst the young, can be attributed to gathering news from the internet, especially in the US, the UK, Greece, Italy, Canada and Spain. In the US, after disastrous results, the New York Times reported a first-quarter profit of US$83.3 million, up from US16.4 million year-on-year, but total revenues were down 3.2 percent year-on-year, and job losses in the industry have been especially severe in the US, the UK, the Netherlands and Spain. The Newspaper Association of America reported that print and online advertising has fallen by 35% since the first quarter of 2008 and that circulation had dropped alarmingly, yet almost all newspapers have survived. Primarily, newspapers have needed to cut costs so as to find a way out of the financial crisis by reducing payroll costs by up to 25%.

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Newspapers survive financial fallout by cost-cutting