New Devices, Platforms Spur More News Consumption,
But News Industry Loses Ground to Technology Rivals
1-in-4 Americans Get News on Mobile Devices – Adding to Existing News Consumption; Social Media’s Role as a Driver of News is Small, But Growing
March 19, 2012— A mounting body of evidence finds that the spread of mobile technology is adding to news consumption, strengthening the appeal of traditional news brands and even boosting reading of long-form journalism. But the evidence also shows that technology companies are strengthening their grip on who profits, according to the 2012 State of the News Media report by Pew Research Center’s Project for Excellence in Journalism.
More than a quarter of Americans (27%) now get news on mobile devices, and for the vast majority, this is increasing news consumption, the report finds. More than 80% of smartphone and tablet news consumers still get news on laptop or desktop computers. On mobile devices, news consumers also are more likely to go directly to a news site or use an app, rather than to rely on search — strengthening the bond with traditional news brands.
While technology may be adding to the appeal of traditional news, technology intermediaries are capturing even more of the digital revenue pie. In 2011, five technology giants generated 68% of all digital ad revenue, according to the market research firm eMarketer — and that does not include Amazon and Apple, which make their money from devices and downloads. By 2015, roughly one out of every five display ad dollars is expected to go to Facebook, according to the same source.
“Our analysis suggests that news is becoming a more important and pervasive part of people’s lives,” PEJ Director Tom Rosenstiel said. “But it remains unclear who will benefit economically from this growing appetite for news.”
Social media platforms, meanwhile, grew substantially over the last year, but still play a limited role in daily news consumption. Only about a third as many news consumers follow stories via Facebook as do so by going directly to news websites or apps or by using search, according to new PEJ survey data released here. For Twitter, the proportion drops to less than a sixth as many.
“News organizations have a big opportunity in the social and mobile realms,” PEJ Deputy Director Amy Mitchell said. “But they will need to do a better job than they did in the desktop realm of understanding audience behavior and developing effective technology and revenue models.”
These are some of the conclusions in the ninth edition of PEJ’s annual State of the News Mediareport. The report is a comprehensive analysis of the major trends in news over the last year and includes detailed chapters on eight major media sectors — digital, newspapers, cable news, network TV, local TV news, audio, magazines and ethnic media. This year’s study also includes two new national surveys examining how news is consumed on different devices and the impact of social media on news, a special report on the state of community media and an examination of Native American media.
Among the study’s findings:
- Americans are far more likely to get digital news by going directly to a news organization’s website or app than by following social media links. Just 9% of digital news consumers say they follow news recommendations from Facebook or Twitter “very often” on any digital device — compared with 36% who say the same about directly going to a news organization’s site or app; 32% who access news through search; and 29% who use news organizing sites like Topix or Flipboard.
- Even so, social media are an increasingly important driver of news, according to traffic data. According to PEJ’s analysis of traffic data from Hitwise, 9% of traffic to news sites now comes from Facebook, Twitter and smaller social media sites. That is up by more than half since 2009. The percentage coming from search engines, meanwhile, has dropped to 21% of news site traffic, from 23% in 2009.
- Facebook users follow news links shared by family and friends; Twitter users follow links from a range of sources. Fully 70% of Facebook news consumers get most of their story links from friends and family. Just 13% say most links that they follow come from news organizations. On Twitter, however, the mix is more even: 36% say most of the links they follow come from friends and family, 27% say most come from news organizations, and 18% mostly follow links from non-news entities such as think tanks. And most feel that the news they get on either network is news they would have seen elsewhere without that platform.
- Most media sectors saw audience growth in 2011 — with the exception of print publications. News websites saw the greatest audience growth (17%) for the year. In addition, thanks in part to the drama of events overseas, every sector of television news gained in 2011. Network news audiences grew 5%, the first uptick in a decade. Local news audiences grew in both morning and late evening, the first growth in five years. Cable news audiences also grew, by 1%, after falling the year before; in particular, MSNBC and CNN audiences grew in 2011, while Fox declined. Print newspapers, meanwhile, stood out for their continued decline, which nearly matched the previous year’s 5% drop. Magazines were flat.
- Despite audience gains, only the web and cable news enjoyed ad revenue growth in 2011. Online advertising increased 23%, and cable ads grew 9%. Most media sectors, however, saw ad revenues decline — network TV was down 3.7%; magazines ad pages, 5.6%; local news, 6.7%; and newspapers, 7.6%.
- As many as 100 newspapers are expected in coming months to join the roughly 150 dailies that have already moved to some kind of digital subscription model. In part, newspapers are making this move after witnessing the success of The New York Times, which now has roughly 390,000 online subscribers. The move is also driven by steep drops in ad revenue. Newspaper industry revenue — circulation and advertising combined — has shrunk 43% since 2000. In 2011, newspapers overall lost roughly $10 in print ad revenue for every new $1 gained online. (That suggests no improvement from what a separate PEJ study of 38 papers found regarding 2010, when the print losses to digital gains in the sample were a $7-to-$1 ratio.)
- The emerging landscape of community news sites is reaching a new level of maturity — and facing new challenges. As some seed grants begin to sunset, a shakeout in community news sites is beginning, along with a clearer model for success. NewWest.net and Chicago News Cooperative are among the prominent community news sites that ceased publishing in 2011 or early 2012. The model for success, epitomized by Texas Tribune and MinnPost, is to diversify funding sources and spend more resources on business—not just journalism.
- Privacy is becoming a bigger issue for consumers, creating conflicting pressures on news organizations. Roughly two-thirds of internet users are uneasy with targeted advertising and search engines tracking their behavior, according to a recent Pew Research Center survey. At the same time, though, consumers rely more heavily on the services provided by the companies that gather such data. News organizations are caught in between. To survive, they must find ways to make their digital advertising more effective — and more lucrative. Yet they also must worry about violating the trust of audiences to protect their strongest assets — their brands.