How the subscription model is steadily squeezing online advertising out of the market
In today’s fast-changing web scenario, the traditional role of online advertising as an engine of economic growth and the predominant business model is increasingly under question.
Gone are the days when advertising was the main source of revenue for most companies with an online presence: this is only the case for a few giants in the sector anymore, such as Amazon, Meta and Google, thanks to controversial and questionable practices that have led them to be the subject of mounting scrutiny from regulators on both sides of the pond that has damaged their reputations.
The publication of Q4 2023 results has highlighted the decline in the advertising market. Prominent companies such as The New York Times have reported a fall in their advertising revenue, both in their digital and print formats. The paper is an interesting case, because while its operating profit grew by a very healthy 39%, its advertising revenue, both digital and print, fell by 8.4%. More profit, fewer tedious ads.
The subscription model is positioning itself as an increasingly attractive alternative to compensate for the loss of advertising revenue, capable of supporting sustainable growth, and more attractive not only for consumers, but also for analysts who significantly value…
