Anyone doubting the LA Times‘ decision to put its website behind a paywall…er…we mean, launch a new “membership service,” would be wise to check out the latest Pew study regarding online ad revenue. According to the study, for every newspaper dollar earned online, seven are lost in print ad revenue. Over the course of the year-long study, newspapers brought in $11 in print revenue for every $1 they made online. So even though digital revenue for newspapers was up 19% on the year, that number didn’t come close to making up the 9% loss in print revenue.
As we wrote when the news of the Times‘ paywall was announced, the LA Times is allowing full digital access to subscribers of its Sunday print edition. In doing so, the Times is effectively using its website to sell its more profitable print product. Sunday circulation has taken a huge hit in recent years. If the added bonus of full online access can boost those numbers, or at least keep them stable, it prevents the immediate threat of a major revenue hemorrhage. And it will hopefully give the paper some time to figure things out until the 11:1 print to online ad dollar ratio begins to narrow a little.