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Newspaper "rules of thumb" challenged by new Inland study
Some long-standing newspaper “rules of thumb” are challenged by the results of Inland’s 2008 Cost and Revenue Study for Daily Newspapers.
Like many industries, newspapers employ financial “rules of thumb” validated more by continued use than any basis in fact or empirical data. Inland’s latest study, covering 2007 data, challenges some of these mythical benchmarks.
Find Inland's 2008 Rules of Thumb here.
Inland’s findings, derived from 261 newspaper participants and co-sponsored by the International Newspaper Financial Executives, reflect realities for newspapers of 10,000, 25,000, 50,000 and 100,000 circulation, comparing them to the time-honored budgeting concepts often used by many newspapers. These circulations cover a cross section of study participants and can be useful for similarly sized newspapers in making comparisons. Some rules of thumb are changing as newspapers undergo change themselves.
For instance:
Newshole has been rising in recent years, and now varies from 49.5 percent for larger newspapers to 56.6 percent for smaller newspapers. This is somewhat higher than the rule of thumb of 50 percent. If advertising declines, newshole rises unless the size of the newspaper is decreased.
Newspapers are less dependent on circulation revenue and more dependent on advertising revenue. Circulation revenue languishes in the mid-to-high range of 30 percent of gross revenues, compared to the rule of thumb of 46 percent. Advertising revenue thus is in the 60 percent range versus the rule of thumb of 55 percent.
Classified advertising revenue continued declining this year to about 35 percent of total advertising dollars, down from 37 to 38 percent last year, though in line with the rule of thumb of 35 percent. Since ad revenues have declined, this percentage continues to be “in line” with the “rule.”
Substantial composing and production efficiencies are in place, ranging from 0.9 composing hours and 0.9 pressroom hours per standard page for smaller newspapers and 1.3 composing hours and 2.7 pressroom hours per standard page for larger newspapers. These numbers are significantly less than the prevailing rule of thumb, previously thought to be 1.5 to 2.0 composing hours per standard page and 2.3 pressroom hours per standard page.
Though the prevailing opinion is that newsroom staffing has declined, study results indicate staffing is increasing when measured using the perceptive “per 1,000 circulation paid,” coming in at about 1.5 persons per thousand against a rule of thumb of about 1.2 news staffers per thousand. This may mean that newsroom reductions have not kept pace with circulation declines.
These and additional Rules or Thumb can be viewed at Inland's Web site, www.inlandpress.org.
Please contact Donald Kron, Inland's financial studies manager, at dkron@inlandpress.org or at 847 795 0380 should you have questions or comments regarding the National Cost and Revenue Study or Inland's Rules of Thumb.
Like many industries, newspapers employ financial “rules of thumb” validated more by continued use than any basis in fact or empirical data. Inland’s latest study, covering 2007 data, challenges some of these mythical benchmarks.
Find Inland's 2008 Rules of Thumb here.
Inland’s findings, derived from 261 newspaper participants and co-sponsored by the International Newspaper Financial Executives, reflect realities for newspapers of 10,000, 25,000, 50,000 and 100,000 circulation, comparing them to the time-honored budgeting concepts often used by many newspapers. These circulations cover a cross section of study participants and can be useful for similarly sized newspapers in making comparisons. Some rules of thumb are changing as newspapers undergo change themselves.
For instance:
Newshole has been rising in recent years, and now varies from 49.5 percent for larger newspapers to 56.6 percent for smaller newspapers. This is somewhat higher than the rule of thumb of 50 percent. If advertising declines, newshole rises unless the size of the newspaper is decreased.
Newspapers are less dependent on circulation revenue and more dependent on advertising revenue. Circulation revenue languishes in the mid-to-high range of 30 percent of gross revenues, compared to the rule of thumb of 46 percent. Advertising revenue thus is in the 60 percent range versus the rule of thumb of 55 percent.
Classified advertising revenue continued declining this year to about 35 percent of total advertising dollars, down from 37 to 38 percent last year, though in line with the rule of thumb of 35 percent. Since ad revenues have declined, this percentage continues to be “in line” with the “rule.”
Substantial composing and production efficiencies are in place, ranging from 0.9 composing hours and 0.9 pressroom hours per standard page for smaller newspapers and 1.3 composing hours and 2.7 pressroom hours per standard page for larger newspapers. These numbers are significantly less than the prevailing rule of thumb, previously thought to be 1.5 to 2.0 composing hours per standard page and 2.3 pressroom hours per standard page.
Though the prevailing opinion is that newsroom staffing has declined, study results indicate staffing is increasing when measured using the perceptive “per 1,000 circulation paid,” coming in at about 1.5 persons per thousand against a rule of thumb of about 1.2 news staffers per thousand. This may mean that newsroom reductions have not kept pace with circulation declines.
These and additional Rules or Thumb can be viewed at Inland's Web site, www.inlandpress.org.
Please contact Donald Kron, Inland's financial studies manager, at dkron@inlandpress.org or at 847 795 0380 should you have questions or comments regarding the National Cost and Revenue Study or Inland's Rules of Thumb.
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| National Cost and Revenue Study for Daily Newspapers |
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