Why Online News Revenue will Never Equal Newspaper Revenue

A publisher’s ability to monetize the news ONLINE is different than their ability to monetize the newsPAPER.

According to the Newspaper Association of America data at naa.org, the average user spent 1 minute and 12 seconds with online news last month.  That is 0.6% of the 3 hours and 25 minutes an average user spent online in 2010 according to eMarketer.  And when compared to average time spent with the print newspaper, online news engagement is 4.1% of the reported 29 minutes per day of Nielsen Media Research Study of 2006.

Of course if lost engagement were not bad enough, the Web has both commoditized advertising rates and set an anchor subscription price of free, further crunching the revenue stream for online news. The net impact is online news will never equal the revenues or profits of a newspaper.

Here are the numbers (click image to zoom):