Magazines to End Recent Revenue Declines, PricewaterhouseCoopers Projection Says
Consumer magazines in the United States will put an end to four years of overall revenue declines in 2012, a new report projected.
Total revenue will edge up 0.1% as advertising increases 2% and consumer spending on circulation slips 2.5%, according to the annual Global Entertainment and Media Outlook from PricewaterhouseCoopers, which was released on Tuesday.
"There are now signs that the economy in both the United States and Canada is improving, and we expect an expanding economy to have a positive impact on print advertising in consumer magazines, which will continue to fare much better than print advertising in newspapers," PricewaterhouseCoopers wrote in its report, which was composed before last Friday's discouraging jobs report. "Consumer magazines benefit more from an expanding economy than do newspapers, whose classified advertising -- which would benefit from economic growth -- is migrating to the internet."
Print advertising, which suffered in the first half of the year, will ultimately grow 0.2% in 2012. That would suggest publishers will see the improvement they've been hoping for after monthlies' ad pages dropped 6.1% in the first half of the year, according to the Media Industry Newsletter.
Magazines' digital ad revenue will meanwhile grow another 17%, PricewaterhouseCoopers projected. And digital's pace of expansion will accelerate, to magazine publishers' benefit.
"In the United States, digital consumer magazine advertising will increase at an estimated 18.5% compound annual rate to $2.9 billion in 2016 from $1.2 billion in 2011," the company wrote.
Print continues to represent a much larger proportion of magazine advertising, however. Print advertising in U.S. consumer magazines will grow at an estimated 0.7% annual rate through 2016 to $10.6 billion, the report said.
Publishers will see print circulation revenue ebb 2.7% this year as newsstand declines continue and free digital competition rises, according to the forecast. But their digital circulation revenue will more than double as tablets and paid tablet editions continue to spread.
United States magazines' total revenue will average 1.6% annual growth through 2016, PricewaterhouseCoopers said.