Worrying Trend? Many Newspaper Web Sites Losing Eyeballs

By: Jennifer Saba Online newspapers are not attracting eyeballs fast enough, suggests a new report from Outsell Research.

"In online usage, what stands out is that most sites are just treading water," Ken Doctor, an affiliate analyst with Outsell and author of the report, wrote. "A few have managed significant growth year-over-year, but most are somewhere between barely growing and losing audience."

Outsell analyzed unique visitors to 25 newspaper sites, including individual sites like ChicagoTribune.com and group sites such as Tribune Interactive. The data is drawn from comScore and covers the period May-July 2006 compared to May-July 2007.

Outsell found an alarming trend: "We see that many news Web sites actually lost ground year-over-year, welcoming fewer unique visitors," Doctor wrote.

The worst performer on the list was MercuryNews.com, the online arm of the San Jose Mercury News, which lost 30% of visitors during that period. Gannett's network of 100 sites fell 2%. NYTimes.com dropped 12% (it still had its pay TimesSelect still in operation then). LATimes.com was down 3%. USAToday.com declined 9%.

Note: This is just one measurement source and the study ended last July.

Outsell believes the main reason for the falloff is that readers are visiting search aggregators and broadcast news sites particularly in the big cities.

Not all lost. McClatchy and MediaNews Group were big gainers, up 70% and 43% respectively but that has more to do with those companies' recent acquisitions.

Lee comes up the big winner with an increase of 24%. Outsell attributes the rise in readership to a few factors including the company training journalists to "think online" and the build-out of databases.

The washingtonpost.com was up 21% thanks in part to its search engine optimization efforts. The WSJ.com gained 7% in that period. Chron.com (the Houston Chronicle's site) grew 5%. Tribune Interactive increased 4%. AJC.com of The Atlanta Journal-Constitution was up 3%. Boston.com advanced 3% and Hearst's properties inched up 2%.

Outsell also measured online revenue as a percentage of total publishing revenue for the top 10 public companies, including MediaNews Group. Outsell compared 2006 revenue to Q1-Q3 2007.

Three companies on the list passed the "10% threshold" i.e. at least 10% of their total revenue is derived from online. For Dow Jones 13% of its total revenue comes from online, a 19% increase compared to 2006. The Washington Post Co. is at 12%, with a 20% gain, while the New York Times Co. is at 10%, an increase of 15%.

Online revenue in general continues to grow at double-digit rates but Outsell provided some interesting findings. The research firm compared the same top 10 companies and parceled out their share of advertising, circulation, and online revenue for 2006 compared to Q1-Q3 2007. Gannett dominates all three categories in 2007 share.

Outsell also points out who is gaining online revenue share. Lee moved up with its share to 3.7% from 2.7% in 2006. The New York Times Co. gained one share point in 2007 to 19.3% while Dow Jones moved up half a point.

Gannett and Tribune however, lost share. The biggest loser was Gannett, which dropped to 24.7% in 2007 from 26.7%.

"For Gannett, the industry leader, one conclusion is clear. While it's execution is above average in print ad sales, it has a lot of work to do online," according to the report.