We live in a world increasingly dominated by technology, and while it's implementation touts great benefits in efficiency and effectiveness, the transition hasn't been easy. This is true in every industry, and journalism is no exception. News outlets are fighting for digital dominance, and the oligarchy of tech juggernauts like Google and Facebook cloud revenue opportunities even further. Because of this, news outlets and organizations depend on revenue from advertisement sales. Even though some news sectors offer data on their digital revenue, there are no comprehensive data available for the news industry overall. What is available, however, are broad digital advertising forecasts for the platforms on which news publishers have a presence.
Digital Advertisement Revenue
Digital now accounts for one-third (33%) of all ad spending ($183 billion) on any platform. That represents a slightly greater share for digital than in 2014, when it accounted for 28% of the $175 billion in total ad spending.
Mobile now accounts for slightly more than half of all digital advertising spending (53%) for a total of $31.6 billion, slightly outpacing the $28 billion in desktop spending. Digital advertising can also be divided another way, by the type of ad that is served. Display ads such as banners or videos are typically how news organizations make much of their digital revenue. Display ad spending overall, which includes mobile display, grew 27% in 2015 to $26.8 billion, modestly more than the 20% growth in 2014.2
Total Ad Revenue By Company
Five technology and social media companies (Google, Facebook, Yahoo, Microsoft and Twitter) continue to set the standard for the digital advertising market, boasting 65% of all revenue from digital advertising in 2015. This accounts for $38.5 billion out of $59.6 billion. The trend is slight but telling, totaling bit higher than the share generated by the top five companies in 2014 (61%).
Of these, Facebook and Twitter in particular rely mostly on mobile for their digital ad revenue: 88% of Twitter’s digital ad revenue came from mobile in 2015, as did 77% of Facebook’s. Mobile ads account for smaller shares of digital ad revenue for Google and Yahoo (41% and 35% respectively), but mobile’s share is growing in both cases (these data are not reported for Microsoft).
Are they making Money?
Aforementioned above, no comprehensive data are available for digital revenue going to news companies overall. However, the available data for many high-traffic digital news startups suggest that some are generating tens of millions of dollars annually in display and native advertising, in addition to multiple rounds of funding raised through venture capital:
- Vox Media received a $200 million round of funding from NBC Universal in August 2015, on top of an earlier $100 million from a group of investors including NBC Universal’s parent, Comcast.
- BuzzFeed was reported to have generated at least $100 million in 2014 and raised $200 million in equity from NBC Universal in 2015. News reports in 2016 suggested that BuzzFeed had missed its 2015 financial targets, though representatives of the site denied the specifics of those claims.
- Business Insider received $25 million in early 2015 from a group of investors led by German media conglomerate Axel Springer SE. A few months later, in September, Axel Springer bought a controlling stake in the publication, valuing it at $442 million.
- The Huffington Post was reported to have broken even on $146 million in revenue in 2014.
- Aside from these national publishers, a large number of smaller, often local, websites get by with substantially more modest annual revenue.
- Digital nonprofit news organizations have traditionally relied heavily on foundation funding, but efforts have increased to diversify revenue streams.