Digital Innovation Digital Publishing
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Optimism shoots up by 31% as revenues from online video and subscriptions grow: AOP/Deloitte report

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Revenue from online video and subscriptions is growing, despite an overall reduction in digital publishing revenues in Q2 2019, according to the latest Digital Publishers Revenue Index (DPRI), a quarterly report on UK publishing from the Association for Online Publishing (AOP) and Deloitte.

DPRI highlights:

  • Online video and subscriptions saw increases of 20% and 14% respectively.
  • Overall digital publishing revenues declined by 3.7%, pushed down by a 15% decrease in display advertising.
  • Multi-platform revenues increased by £15.8m (20%).
  • Optimism among AOP board members regarding their own company’s financial prospects rose to 75%, a 31 percentage points increase.

Digital publishing revenues declined to £113.1m in Q2 2019, a 3.7% fall in comparison to Q2 2018. A 15% decrease in display advertising in Q2 2019 was almost entirely responsible for the negative growth. However, the fall in revenues was partially offset by online video and subscriptions, which saw increases of 20% and 14% respectively, in comparison to Q2 2018.

“Publishers across the board are looking to diversify their revenue sources and move away from solely relying on advertising revenue,” said Richard Reeves, Managing Director, AOP.

Despite the overall decline in revenues, optimism among AOP board members regarding their own company’s financial prospects rose to 75%, a 31 percentage points increase compared to Q2 2018.

The examples of innovation I see every day give me confidence that we are on the path of a better, more secure future for our industry.

Richard Reeves, AOP

When looking across platforms, desktop-only revenues decreased by 58% and revenues from mobile devices (smartphones and tablets) fell by 12% from Q2 2018 to Q2 2019. However, multi-platform revenues (campaigns containing more than one platform) increased by £15.8m (20%), indicating that more campaigns are multi-platform than solely desktop – reflective of responses to changing consumer behaviours.

Investments in developing content for multi-platform purposes are clearly paying off,” commented Dan Ison, Lead Partner for Telecoms, Media and Entertainment at Deloitte.

Organisations have a pressing task ahead of them to create high-quality content that appeals to consumers in a range of formats.

Dan Ison, Deloitte

B2B revenue increased by 4% to £19.8m in Q2 2019, from £19.1m in Q2 2018, driven by a rise in sponsorship (53%) and a modest increase in display revenues (3%) and subscriptions (2%). B2C quarterly revenue declined by 5.2% in Q2 2019 in comparison to the same quarter in 2018, fuelled by a significant decrease in display advertising, dropping from £53.3m to £45.0m (-16%).

Looking ahead to the next 12 months, AOP board members are prioritising diversifying revenue streams, with 88% of respondents reporting non-advertising revenue growth as a high priority focus.

Half (50%) of publishers also reported the introduction of new products and services as a high priority over the next 12 months.