External sources fuelled €53M in ad revenue for news publishers in Europe in January.
There are many indicators that the platform-publisher-people triad is already successful. We’ve sized the market in our News Ecosystem Report, but, more importantly, we’ve identified the hot spots. Demand for news is strong, and the way people are getting their news seems to be working for them, for the platforms, and for news publishers.
The data also gives us a clear sense of value to each constituent in this partnership. (the full report is here)
Crucially, it appears that referral traffic to news is adding a lot of value for news publishers without requiring their dependence on platforms.
News publishers earned €1.8B in Europe in 2017, or about €152M per month, according to PwC’s Global entertainment and media outlook report 2017–2021.
The value of traffic can then be considered in terms of revenue per session. At €152M per month on 21B total sessions* across news publishers’ digital properties in January we arrive at a figure of €0.007 per session.
While 7 tenths of a cent seems disturbingly small it grows very quickly given the incredible scale publishers are achieving. The idea of reaching tens of millions of readers every month would have been inconceivable to the founders of many of the leading newspapers today.
What is the value to publishers of the referral traffic we’ve measured? With 7B sessions to news initiated by clicks from 3rd party sites that means the total digital ad revenue derived from referral traffic to articles was approximately €53M or 1/3 of total monthly ad revenue.
This is not a dependent or even co-dependent relationship. Traffic generated by 3rd party sites is powerful fuel for a news business, but news can survive without it, too.
These values work in context of other metrics we already understand, too. For example, we estimate the total number of “Views” across news publishers in Europe in January at 80B (21B total sessions* x avg 3.81 views/session). That translates to an average CPM across the market of €1.90, not far off from CPMs in the US, according to eMarketer.
As benchmarks these figures become useful tools for improving the relationship between platforms and publishers.
The numbers suggest the relationship is adding real value. The challenge is working out how to continue building a healthy co-existence.
* “Total sessions” includes Referrals, Direct, Unknown and all other traffic on news publishers’ owned and operated digital properties.