Mid-year forecasts: Digital advertising up, print sales down, subscription curve flattening

By Dr. Merja Myllylahti

Senior Lecturer and Co-Director of Journalism, Media, and Democracy (JMAD) Research Center

Auckland University of Technology (AUT)

Auckland, New Zealand

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Key forecasts for the media and entertainment sector for this year and beyond are out. While the predictions for digital advertising are mainly positive, the outlook for print newspaper sales is less rosy, and the expectations for digital subscription growth are somewhat worrying.

By 2026, digital newspaper advertising revenue in the United States is forecast to be approximately US$5 billion, slightly surpassing print.

Let's start with digital advertising

PwC forecasts digital advertising will grow by 6.6% and Internet advertising revenue by 9.1% through 2026. PwC notes that in 2026, advertising is "projected to be a US$1 trillion market and the largest entertainment and media revenue stream, having surpassed consumer spending and Internet access." Zenith also forecasts strong growth in advertising in North America, predicting 12% growth for the rest of the year.

On the other hand, global media investment and intelligence company MAGNA has lowered its estimates of advertising growth, predicting the global advertising market will grow 9.2% this year instead of 12%.

PwC's Media and Entertainment Outlook 2022-2026 estimates the global newspaper and magazine publishers "face losing another US$15.5 billion in combined revenue through the forecast period." Furthermore, it says that while digital revenues are growing, "they will not make up for the decline in print income."

By 2026, digital newspaper advertising revenue in the United States is forecast to be approximately US$5 billion, slightly surpassing print.

For print, it is not good news

The sale of print newspapers is said to drop by 40 million by 2026, from 451 million in 2021 to 411 million in 2026 "as readers and advertisers seek other media outlets for spending their time and money." However, India continues to be an outlier; it is predicted to become the world's largest market for print newspaper readership in 2025.

While some newspaper markets and some publishers are reporting growth in digital subscriptions, the growth curve for digital subscriptions is flattening. Recently, The Economist reported "robust" subscriber numbers. It now has almost 1.2 million subscribers which had "propelled it to the record revenue." Approximately 55% of the publisher's revenue is digital.

According to the latest Reuters Digital News Report, the number of people paying for digital subscriptions has increased slightly in Australia, Germany, and Sweden. However, the report says "there are signs that overall growth may be levelling off."

Across the basket of 20 countries included in its core payment analysis, the number of people paying for news has remained at 17%. The report notes that persuading young people to pay for digital subscriptions for news "remains a critical issue for the industry, with the average age of a digital news subscriber almost 50."

On a positive note, in some countries such as Australia and the United States, people who are already paying for digital subscriptions have started to pay for more than one news subscription. Additionally, they pay for different kinds of products including political opinions and local news. The growth for digital news payments may be levelling off, but there are some hopeful signs.

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About Dr. Merja Myllylahti

Dr. Merja Myllylahti is a senior lecturer and co-director of the Journalism, Media, and Democracy (JMAD) Research Center at Auckland University of Technology (AUT) and project manager at AUT's Research Centre for Journalism, Media, and Democracy in Auckland, New Zealand. She can be reached at ‎[email protected] or @Myllyme.

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