Mediaboss Marketing

STEVE LADURANTAYE MEDIA REPORTER Published Monday, Mar. 05, 2012 9:59AM EST Last updated Monday, Mar. 05, 2012 10:58AM EST

Newspapers desperate to shift their businesses online are earning $1 in digital advertising revenue for every $7 they are losing in their print products.

The Pew Research Centers Project for Excellence in Journalism studied 38 newspapers in the United States, and cited cultural inertia for the papers inability to seize new revenue opportunities.

The industry is caught in a trap, the report states, where declining print revenues provide most of the money but digital revenue is the only category seeing growth.

Its reflected in their sales forces where print ad reps outnumber digital ad reps 3-to-1.

The shift to replace losses in print ad revenue with new digital revenue is taking longer and proving more difficult than executives want and at the current rate most newspapers continue to contract with alarming speed, the report stated, adding that the executives they interviewed considered replacing print revenue an existential issue.

The biggest challenge, the report stated, is that managers are convinced the old way of doing things will salvage whats left of their ad bases.

Newspaper executives described an industry still caught between the gravitational pull of the legacy tradition and the need to chart a faster digital course, the report stated. A number of them worried that their companies simply had too many people whether it be in the newsroom, the boardroom or on the sales staff who were too attached to the old way of doing things.

The study focused on smaller papers, since most U.S. papers fit in that category 22 have circulations under 25,000, seven have circulations between 25,000 and 50,000, and nine have circulations of 50,000 or more (including three with circulations more than 100,000).

While the study focused on American papers, Canadian newspaper owners face the same challenge.

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U.S. newspapers slow to grow digital ad revenue: survey