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Online media revenues were already down before COVID-19 struck, new stats show
By Chris Cooke | Published on Wednesday 20 May 2020
With several music magazines now facing an uncertain future as they deal with the impact of the COVID-19 shutdown, new stats from the Association Of Online Publishers have confirmed that the media industry in general was already facing a challenging 2020. They also show that those publications able to grow a subscriptions business are in the best position to meet that challenge.
Bauer Media this week confirmed that Q and Planet Rock magazines were among ten publications that faced closure, sale or merger as the company seeks to streamline its portfolio of titles. Meanwhile, independent music mag Loud & Quiet has launched a campaign calling on readers to sign up to a subscription package to help it stay in business.
While those three print titles have all been specifically hit by the distribution challenges and advertising slump caused by COVID-19, they were all already tackling the general challenge facing many newspapers and magazines today: that their print revenues are in decline, but it’s hard to shift everything online in a world where “content is free” and most internet advertising spend goes to the likes of Google and Facebook.
And, of course, we know that those media that are primarily or exclusively online operations – some of which raised loads of investment and went through periods of rapid growth in the early 2010s – are facing the same challenges. Both the general challenge and the COVID-19 challenge. Resulting in layoffs at an assortment of media companies in recent weeks, including Vice and Buzzfeed.
According to the Press Gazette, AOP figures show that digital publishing revenues in the UK were down in the final quarter of 2019, even before the COVID-19 pandemic began.
According to a survey of its members – which includes both consumer-facing and business media – AOP says that the digital revenues of British publishers were down 6.2% year-on-year in that quarter, the slump being caused by a 22% dip in display advertising and 20% slide in job ads. Subscription income and sponsorship monies were both up in the same quarter, 24% and 10% respectively.
Dan Ison at Deloitte, who helped compile the figures, tells the Gazette that that “subscriptions spike” was the highest in a year-and-a-half. He also reckons that subscriptions will become an ever more important part of online media.
He says: “As households and business leaders remain cautious of discretionary spending during COVID-19, communicating the value of subscriptions will be fundamental in ensuring revenue growth in the year ahead. In the longer term, subscription revenue will grow in importance as a solid bedrock for publishers looking to diversify their business models”.
It took a long time for media firms to persuade readers to pay for written journalism online, and even now it’s really only business media and broadsheet newspapers that have launched subscription products that are gaining momentum. If subscriptions are the future of online media, that poses the interesting question of whether people can be persuaded to pay to access music and entertainment journalism.
Very few music media have even dabbled with the subscription approach online, although obviously some print magazines have had a mail-order side to their operations for some time. It will be interesting to see if, as many music mags are taken to the brink by COVID-19, a successful subscriptions model does take hold.
In that domain, independent magazines like Loud & Quiet – with much lower overheads, a loyal following and no corporate parent company grabbing any profits – may find themselves in a better position.
And, in a weird way, COVID-19 could help, in that it provides a crisis around which that loyal following might rally. And if independent titles can rally that audience now, covering their overheads upfront through subscriptions, they might come out of the COVID-19 period with a more future proof business model. We will see, I guess.
Meanwhile, for the more mainstream music press – owned by corporate media firms – it remains to be seen if they too can use the crisis to rally support in this way. If not, how else can these titles generate income? Or will we start to see a flurry of closures in the year ahead?
