Newspaper Revs Sink 6.9%, Auto Ads Brake

Newsstand-AA5The latest figures for the newspaper industry are in, and they show no evidence of a rebound or even stabilization in advertising revenues.

According to the Newspaper Association of America, total ad revenues dropped 6.9% from $5.5 billion in the first quarter of 2011 to nearly $5.2 billion in the first quarter of 2012. This was due to declines in print ad revenues, which fell 8.2% to $4.36 billion over the same period.

Online ad revenues edged up 1% to $816 million.

As in previous quarters, the losses were spread across all the major ad categories. National advertising fell 10% from $924 million to $832 million, retail slumped 6.9% from $2.67 billion to $2.49 billion, and classifieds sank 9.9% from $1.15 billion to $1.04 billion.

Within the classifieds category, automotive slid 9.5% to $241 million, real estate tumbled 17.7% to $163 million, and recruitment slipped 4.2% to $159 million.

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However, online advertising, one of the few bright spots for the newspaper business, has seen growth slow dramatically from an average rate of 6.8% in 2011 and 10.9% in 2010. This is especially ominous because it still remains a fairly small part of the overall business, accounting for 15.7% of total ad revenues in the first quarter of 2012.

It's clear that newspapers are stuck in a long-term, secular decline with little prospect of the trend reversing. The first quarter marks the 23rd straight quarter of year-over-year declines in total newspaper ad revenues, which started to slip in the third quarter of 2006.

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