Pew - State of Local TV News

Pew has just released its State of the News Media 2015 report, and I'll be sharing some results and comments.

2014 saw local TV station revenues increase (mostly from huge rise in political advertising), and some increased viewing for most local news programs.  Overall revenues increased 7% from the previous year, but still remained below 2012 numbers (when even more political advertising and the Presidential race helped spike local TV revenues).

The year also saw a continuation of the rise in the share of revenues coming from news programs, accounting for 84% of over-the-air revenues.  While good news for potential growth of local news programs and coverage, I'm not convinced that such a level of reliance on one programming source for station revenues is good for the long-term financial health of local broadcast TV.

The study also predicted a substantial growth in retransmission consent fees (from SNL Kagan numbers) over the next few years.  This comes with three big caveats, however;

• Broadcast networks are demanding an increasing share of retransmission consent fees from local broadcasters, so it is unlikely that local stations will benefit that much from projected increases
• It's starting to look like multichannel rights fees are starting to plateau.  Larger MSOs are starting to resist network demands for licensing fees, as the amounts are approaching audience perceptions of value.  This is contributing to cord-cutting and the push for a shift to "a la carte" pricing.
• The economics of "a la carte" are likely to be substantially different than the existing business model, and are unlikely to sustain current revenue levels.  Particularly for local TV broadcasters, which must provide their primary service broadcasts free to the public (by FCC regulations)

As for local TV news, Pew notes that the number of hours of local TV news seems to have reached a plateau.  That's one factor contributing to limited growth in news staff salaries.

(I'm trying Pew's embed function for the graphics - my apologies if it's not working right)

Source - The State of the News Media 2015, Pew Research Center report

Pew - Demographics and Local News Habits

From Pew, some nice graphics on demographic differences in local news use.

Pew: Key Indicators of News Use

The PewResearch American Journalism Project released its State of the News Media report for 2013 last week.  The report suggests a news industry in transition, and news audiences starting to shift their patterns of news use as they discover the value of newer news delivery options.  Here's some highlights-

The decline of print
The newspaper industry has been fighting, unsuccessfully, declining subscription and readership numbers for decades.  Even with liberalized definitions for subscribers and the growth in usage of newspapers digital offerings, they managed only a 3% increase in total readership in the last NAA report.  

The outlook's even worse for News Magazines' print editions.  Newsstand sales have dropped 43% since 2008 (although subscriptions have remained steady). Two of the major US news magazines have abandoned print for online, and even with the significantly lower costs of online are struggling to survive.

Readership also continued to decline for the top alternative weeklies, although at a slower pace.

Broadcast & Cable News
The broadcast networks tended to hang on to their aggregate news audiences, although differences continued to exist among the big three performances.  On aggregate, audiences for both the evening and morning news shows grew slightly, but remained within the range of audience numbers over the last few years.

Cable news network audiences declined slightly in 2013, but were coming off a Presidential election year (so no real surprise there).  2013 was more notable for the continuing fall of CNN, whose ratings have been hitting 20 year lows in recent weeks, leaving CNN in the cable news ratings basement.  MSNBC, lacking a significant Republican to bash, dropped a quarter of its primetime audience in 2013.  Fox News Channel retained its ratings dominance in ratings, and continue to reap the benefits, generating almost twice the revenues of CNN, and four times the revenues of MSNBC.

Local newscasts from broadcast stations started to gain audiences in 2013, building on the growing morning news programming, and greater use of mid-day and afternoon time slots for expanded news offerings.  With more stations doing news programming before the main evening newscast, and extending the time for those shows, employment opportunities in local news improved slightly - one of the few bright spots in traditional journalism.

Digital

The transformation of the news marketplace is being driven by digital. In 2013, 82% of Americans reported getting news on their desktops or laptops, and more than half (54%) reported getting news through their mobile devices.  Online is where most people go first for news.  Digital operations of newspapers saved readership numbers, and many (but not all) outlets found online subscriptions a growing source of revenues in an otherwise declining market. Digital advertising dollars remain the fastest growing segment (soon to surpass TV), although the share earned by traditional news outlets is shrinking and is unlikely to replace print and TV advertising losses.  2013, and the last few years, have seen a surge in the use of commercial online-only news outlets, other online news sources, and social media by audiences.  outlets.

More transformational has been the developing role that social media plays in the news process.  News users are increasingly involved in disseminating news (sharing reports), discussing it with others, and contributing content (primarily photos and videos) to developing stories.

Source: Key Indicators in Media & News, a report of the PewResearch Journalism Project (part of State of the News Media 2014 study)

Trends in Local Media News App Use

Mobile is booming.  Half of U.S. adults have smartphones, and 1 in 4 have installed an app from a local media source.  Overall, that's not an overwhelming number (yet), but its enough to get a look at how these early adopters and utilizing those apps.
StepLeader conducted a large scale survey of mobile users, and for this report looked at the roughly quarter of them that indicated that they had installed and used an app from a local media outlet on their smartphone, a tablet, or on a connected-TV.  It's not a random sample, but good enough to provide an initial look.

Local news apps were overwhelmingly on smartphones (92%), while more than a third (37%) have local news apps on tablets.  (Only 4% have them on connected TVs, but penetration of those sets remains very low).  Demographically, local news app users are well-educated (92% have at least some college) and affluent (71% reported incomes of $50K or more).  When asked their reasons for downloading a local news app, the top responses were that the apps were best for local news and for local weather.  In fact, news, weather & sports account for 97% of app interest.  The apps were used fairly consistently throughout the day (except for overnight (11pm - 6 am) and dinner time (5- 8 pm).  Some 26-36% of respondents reported using local news apps in all  of the other dayparts.  Users were also generally happy with the apps - 60% said they would be Likely or Very Likely to recommend the app to others.

Despite this use, local news app users indicate that local TV broadcast news remains their primary choice for getting local news and information.  In what's got to be a disappointment for traditional newspapers, more of the sample identified local newspaper websites (7%) than local print newspapers (6%) as their primary news choice.  Breaking these down by age, the proportion citing local TV news broadcasts as their primary source increased over age groups - only a third of the 18-29 age group cited broadcasts as their primary source, while 62% of those 60 or older did.  Online sources, apps or websites, trended in the other direction, being cited more frequently by younger respondents.

The survey also asked how frequently respondents used various local media sources.  Here, the proportion that accessed that outlet every day was only slightly higher for local newscasts (36%) than it was for local news apps (32%).  The proportion of occasional users (2 - 5 days a week) were slightly higher for local news apps (10-14%) than for local news broadcasts (8-11%).

Now for the bad news for local news outlets - 82% said they would not be willing to pay for local news apps (primarily because its available free on other outlets, and/or available elsewhere).  Only 4% expressed a willingness to pay (but two-thirds were willing to pay only $1.99 or less).  The other 14% said they might be willing to pay if the app offered something valuable - like no ads (29%), or unique content (63%).  In addition, only 11.9% reported relying only on a local news app rather than also using national or international news apps - and thus faces competition.  The news apps most frequently reported were CNN (40%), Fox News (33.4%), Yahoo News (32.3%), USA Today (22.0%), NY Times (18.2%), and the BBC (16.8%).

Source -  Local Media App Trends, Summer 2013: Survey of Local Media App Users,  StepLeader report.