Media Flat Rate

In a move that will massively alter the business of newspapers in the United States, the Los Angeles Times and other big name newspaper companies have agreed to charge fees for people to view full-page advertisements. The agreement also appears to mark the start of a wave of similar announcements coming from other major newspapers that, after years of watching advertising revenue drop as newspapers struggled to adapt to the digital age, have decided it is time to rake in some extra revenue. “This agreement will give our advertisers an opportunity to reach and engage our readers while generating more revenue for our newsroom, helping us continue to provide the independent and local news that our readers rely on,” said Orlando Sentinel publisher and editor Kristen M. Utecht in a press release announcing the deal. “It also provides further choice and transparency to our readers by offering the ability to select only the portion of an ad they want to see, reducing their exposure to visual ads that can detract from their reading experience. The agreement demonstrates the willingness of companies of all sizes to provide their advertisers with such flexibility.” Under the agreement, the Los Angeles Times will make all digital advertisements 15% more expensive to view. The LA Times’ deal with Google, currently under review by the Office of the California Attorney General, will reportedly help the newspaper “address its significant revenue shortfall,” in part by charging for full-page advertisements for the first time in almost half a century. According to a memo sent to employees by the Los Angeles Times’ publisher, David Chavern, the newspaper’s average daily circulation fell 15% in the second half of 2014 to 190,810. Meanwhile, ad revenue dropped $17.6 million between August and December of 2014 and is expected to drop $40 million in 2015. The Times’ circulation dropped 14% in the last half of 2014 to 178,897. “[T]he ad revenue declines make it essential that we find new sources of revenue to help offset our overall operating costs,” Chavern wrote. “This is the first step in that process.” “Some newspapers have tried charging for online content or requiring readers to pay for online access to newspapers’ daily content,” writes media columnist Steve Lopez in the LA Times. “But such price structures have mostly done little to stem the steady decline in readership and advertising revenue.” The LA Times is hardly the first major newspaper to embrace the idea of charging for advertising. The Washington Post has run three different pricing models in the past year, charging readers different fees for various ads. The most recent change was to adopt a paywall, with some ads served free and others only if a reader is willing to pay for them. The New York Times already charges online readers to view videos, as well as some online-only advertising. The Washington Post reportedly pays about $70 million a year in so-called “ad page

Leave a Reply

Your email address will not be published. Required fields are marked *