A new study commissioned by Accenture and commissioned by Google claims that the decline in revenue in the Western European news industry was largely due to a loss of classified revenue.

Loss of news media revenue

The news industry is trying to blame companies like Google and Facebook for declining advertising revenue.

I went to the first one Google Zeitgeist Partner Forum Conference in 2005, held at Google’s Mountain View headquarters and listened to keynote speeches by top management at companies like the New York Times to blame for a decline in their assets on Google.

The loss of advertising revenue in the digital age has been a constant theme for over 20 years around the world, and many have cited the reason for Google.

However, the research report contradicts these claims by providing facts that show that the increase in advertising opportunities is not responsible for crowding out traditional advertising.

According to the report:

“… a significant majority (64%) of online advertising growth has come from new growth rather than displacing the current market for traditional advertising.”

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Is revenue from classified ads mostly to blame?

According to a new study, the collapse in advertising revenue is to blame for the decline in news revenue in Western Europe. According to the study, nearly 50% of the loss of revenue is due to a decrease in print organizations ’print ads and an increase in third-party ads.

An example of losses in the Western European media

The chart shows that 44% of the decline in advertising revenue in Western Europe was due to a loss of revenue from classified ads.

According to the report:

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“The data is clear: Nearly half of the total decline in newspaper revenue has not come from search or social advertising, but from the loss of newspaper categories to specialist online players.

… Most newspaper advertising was done on ratings such as car and home sales, job listing, and birth and death announcements.

These advertisements or “classified advertisements” accounted for € 9.9 billion – almost a quarter – of newspaper revenue, with newspapers accounting for 93% of all classified advertisements in 2003.

By 2019, only 32% of revenues went to newspapers, generating only € 2.8 billion, and the decline was 44% of total newspaper revenues. “

Newspaper classified company retrieved from specialty sites

According to the report, news organizations in Western Europe lost their rating revenue to a narrow classified site that targeted certain vertical targets.

In the past, consumers and businesses advertised printed newspapers about the sale of cars, jobs, apartments for sale, and even garages.

Many of these classified ads moved to websites specializing in each of these industries.

The report named real estate sites Scout24 and Rightmove, workplace Total workand car rating sites Mobile.de, Automobile.it, Bilbasen and Motors.co.uk as sites that are largely responsible for removing classified advertising revenue.

The report also noted that some sites are currently owned or owned by news media sites.

According to the report:

“The dominance of newspapers in the market for classified markets has been questioned. The dominant competition has been through pure gaming websites – they focus on specific vertical markets. By 2015, network service providers gained two-thirds of the market share of the classified market.

Many of these pure plays are or were previously owned by newspaper publishers or media groups. This includes the Scandinavian classified company Schibsted, the German Axel Springer and the Spanish pisos.com, Infoempleo.com and autocasion.com operates Vocento. “

This means that some news organizations that complain about the loss of reported announcements will still earn or sell their classified businesses.

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Although the research report does not explicitly say so, the result is that some of the culprits for the loss of classified revenue are due to the activities of the news organizations themselves and some complaints about the loss of this company may not have been made in good faith.

News online advertising revenue

According to the report, advertising revenue may have declined in print publications (along with readership), but online advertising revenue increased from the periods studied from 2003 to 2019.

According to the report:

“… the value of online advertising has grown significantly from € 2.2 billion in 2003 to € 50.5 billion in 2019, as well as growth in all advertising sectors.

But this did not happen at the expense of newspaper revenue. “

Have news organizations wrongly blamed Google for their losses?

Although this report covers the Western European media, there are interesting facts about the role of Google and Facebook in the decline in Australian news media revenue, which may be relevant.

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The Australian Commission claims that both Google and Facebook have eaten up news organizations ’advertising revenue.

According to a report on the BBC:

“… a Commission study on the dominance of online advertising by technology companies showed that in 2018, for every $ 100 (£ 56; € 65) spent by Australian advertisers, $ 49 went to Google and $ 24 to Facebook.”

The report does not mention how much more revenue Western European news media would earn if Google did not gain a dominant position in online advertising.

The amount of revenue overtaken by Google and Facebook is not an issue addressed in an Accenture research report commissioned by Google.

As with any dispute between two parties, every story always has two sides.

It will be interesting to see how news organizations respond to this study.

References

Official Google Alert
Research: What actually happened in newspaper revenue

Link to Accenture report (commissioned by Google)
Western European News Media Landscape Development 2021 (PDF)

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