Developing Nation Press Is Growing p.18

By: DEBRA GERSH HERNANDEZ IRONICALLY, IT IS the press in the industrialized nations that showed the worst circulation and advertisng declines last year, while newspapers in developing nations continued to grow at extraordinary rates.
Thus, International Federation of Newspaper Publishers (FIEJ) director general Timothy Balding aptly titled his remarks to the 49th World Newspaper Congress in Washington, D.C., "A Tale of Two Worlds."
"One world, that of the advanced, industrialized nations, where newspaper circulation and market share of advertising continue their decline; the other world, that of countries still
in development where, in numerous instances, the press is booming and recording remarkable sales and advertising performances," Balding said.
In 1995, daily circulation declined in 26 of the 47 countries included in the report, he explained.
The European Union showed a drop in sales of 0.68% from 1994 to 1995; in the United States, the figure was down 1.32%; and in Japan, it was up 0.17%.
The percentages, Balding explained, amount to 600,000 and 800,000 fewer newspaper buyers each day in the E.U. and U.S., respectively.
"It remains impossible to present a completely coherent picture for 1995 of Asia or of Latin America as regions, principally because of the lack of data available for several countries," he noted. "It is, however, well worth highlighting the performance of newspapers in a few individual countries."
The FIEJ report showed that in India daily circulation rose 9.6% between 1994 and 1995; in Malaysia it was up 4%; and daily circulation in Brazil showed an 11% gain.
Balding pointed out that when the figures are looked at over a longer period, going back to 1991, they are "even more impressive."
Between the years 1991 and 1995, daily newspaper circulation in India grew by 33.4%; by 24.4% in Malaysia; 22.68% in Brazil; 14.81% in Singapore; and "an astonishing" 84.2% increase in Turkey, Balding reported.
Looking at individual countries within the E.U., 11 showed a decline in sales for 1995, one was stable and three showed growth.
The worst decline in Europe was suffered in Ireland, which saw a 13.46% drop in daily newspaper sales from 1994 to 1995, Balding said. Even Norway suffered a loss, 1.56%, "the first year of decline for more than 40 years."
Portugal (up 52.5% since 1991), Spain (up 4.49% in 1995) and Italy (up 0.4% in 1995) were the European nations showing increased sales, all three of whom "are rising from an extremely low penetration base," Balding explained.
Most of the newspapers in Eastern Europe also "slipped badly," according to the FIEJ report.
Last year, daily circulation in Hungary was down 10.4%; in the Czech Republic it declined 5.81%, down 26% since 1991; newspapers in Latvia saw a drop of 18.1%; and circulation in Estonia was down 12%.
"Only Poland seems to be resisting, with a 20% increase in circulation over the past five years," Balding noted.
Japan and the United States still are first and second in combined daily circulation, with 72 million and 58 million newspapers sold each day in each nation, respectively.
In third place was India, which moved ahead of Germany by selling 29.48 million newspapers each day. In Germany, 25 million newspapers were sold daily.
When studying advertising revenues, FIEJ found "many countries continuing to win back revenues lost during the recession years, though the rate of growth in 1995 was often lower than in 1994," Balding reported.
Ad revenue in the U.S. was up 5.46% for 1995 after a 7.25% increase the year before; newspapers in the European Union saw ad revenues increase 3.93% in 1995 after a gain of 7.76% in 1994; and in Japan, after four consecutive years of decline, ad revenues rose 4% in 1995.
Some countries, however, really showed tremendous increases.
For example, Brazil was up 34.29%; and, when adjusted for inflation, India was up 33.1%; South Korea 15.42%; South Africa 13.7%; the Slovak Republic 11.35%; Denmark 10.43%; Singapore 8.8% and Sweden 7.5%.
When it comes to their share of the total advertising market, however, in 29 of the 37 countries for which this information was available, newspapers garnered less than half of the total revenue. For example, in Belgium, newspapers take only 18.9% of the total ad revenue, in Italy it is 21%, and in the U.S. it is 22.8%.
"Underlying my original message that current trends are effectively a tale of two worlds, we can point to the following positive information for other countries," Balding commented.
From 1992 to 1995, newspapers in Argentina saw their share of the advertising market increase by 8.5 points; while those in Brazil saw it go up 10.7 points; in India it was up 8 points; in South Korea the gain was 2.8 points and in Malaysia, 2 points.
"One interesting feature of our survey is an examination of where newspaper income comes from in the various countries," Balding said, citing the United States and Japan for being at either end of the scale.
"In the USA, 86% of total income came from advertising in 1995, a shift of one percentage point towards advertising when compared to 1994," he explained.
"In Japan, the share of total revenue which comes from advertising dropped one percentage point, and now stands at just 39%," Balding continued.
"The difference is, in fact, growing significantly . . . . In the USA, the ratio in favor of advertising grew 10 points between 1991 and 1995; in Japan, it dropped 10 points in favor of circulation over the same period," he said.
Norway was the "world leader" in penetration, with 600 newspapers sold per 1,000 people. Japan was second with 576 copies per 1,000; and Finland and Sweden tied for third at 464 copies per 1,000, Balding reported, adding that the United States was in 15th place with 226 per 1,000.
The complete report, "World Press Trends," which contains country by country and global analysis of features such as circulation, readership, market penetration, advertising and sales revenue, classified advertising, market reports, advertising expenditures per medium, ad expenditure ratios per product category, VAT and other taxes, regulations on ownership, and public subsidies, is available from the FIEJ office in Paris, France.