• by Erik Sass  @eriksass1, July 24, 2008

Sadly, newspapers have found some companions in despair, as magazines and radio are now in the same economic boat. Unfortunately, the boat is sinking. Here's a round-up of the troubled traditional trifecta.

On Wednesday, The New York Times Co. announced another round of dismal second-quarter results, with total ad revenues falling 10.6% compared to the same period in 2007. That contributed to an overall revenue decline of 6%, to $741.9 million.

NYTCO's revenue declines follow similarly dismal second-quarter results from other newspaper publishers like Gannett, where publishing ad revenues fell 13.3% to $1.11 billion, and Media General, with newspaper ad revenues down 17.1%. McClatchy's results--due out Thursday--will not be much better, judging by revenue declines of 14.8% in April and 15.1% in May.

Magazines and radio are not doing quite as badly, but there's no question they are also suffering.

Of 36 weekly magazines tracked by MIN Online, ad pages have fallen at 29, or about 80%, for the year-to-date. Double-digit declines hit 14, or about 39%, including big titles like BusinessWeek, GQ, Entertainment Weekly, The New Yorker, Newsweek, Time and U.S. News and World Report.

Meanwhile, of 169 monthly titles tracked by MIN through June, 121 (about 72%) have seen ad pages fall for the year-to-date, with double-digit declines at 59 (about 35%). Big monthlies that are experiencing double-digit declines include Better Homes and Gardens, Cooking Light, Cosmopolitan, Family Circle, Health, Home, Lucky and Vanity Fair.

According to MIN's figures through June, biweeklies ESPN Magazine, Forbes and Rolling Stone are also suffering double-digit declines.

At this rate, 2008 is certain to see more magazines close. Titles already closed this year include: Golf for Women, Quick and Simple, American Jewish Life, Future Snowboarding, Mass Appeal and Luxury Spa Finder.

The turmoil in magazines is also reflected in the sudden turnover among top executives at a slew of big publishers. These include the surprise resignation of Victor F. Ganzi, who is stepping down as president and CEO of the Hearst Corp. due to "irreconcilable policy differences with the Board of Trustees about the future direction of the company," and the departure of Jack Kliger as CEO of Hachette Filipacchi Media on Sept. 1.

Radio rounds out the traditional crew, with alarming revenue declines for the year-to-date--far in excess of what radio groups or independent analysts predicted. In the first quarter, total revenues fell 5% to about $4.5 billion, followed by monthly declines of 1% in April, 8% in May, and 9% in June (quarterly totals are not yet available).

While all three mainstays of the traditional media have scrambled to adapt to the digital age with more online features and services, their Internet businesses still contribute just a small fraction of total revenues. Even more ominous, the rate of growth in online revenues is slowing, making it unlikely that they will ever be able to offset losses in the core business.

For example, NYTCO's total online revenues grew 12.8% in the second quarter to $91.3 million, contributing about 12% of the total. Meanwhile, the rate of growth is just about half of what it was for the same comparison period in 2006-2007, when it grew 23.4% to $80.9 million.

The amount of dollars added each year also shrank, from $15.3 million last year to $10.4 million this year. Media General's interactive revenues grew 13.7% to $10.6 million--significantly slower than the 44.5% growth rate of second-quarter 2007.

Magazine and radio groups are more secretive about their digital revenue figures, but outside analysts have provided some sobering figures. In a report titled "Global Entertainment and Media Outlook: 2008-2012," PricewaterhouseCoopers predicts online magazine revenues in the U.S. of $560 million, or less than 4% of total ad revenues of $14.56 billion. Even with a robust annual growth rate of 47.7%, that means digital revenues will be $2.4 billion in 2012, or just 13% of a total $18.4 billion.

Most radio groups also guard information about their digital revenues, making it difficult to know whether an individual company is doing better or worse than average. However, looking at the industry as a whole, Wachovia analyst Marci Ryvicker wrote in her roundup after the SNL/Kagan Radio/TV Summit: "We are at least five (if not 10) years away before new media/digital opportunities have any financial significance in the broadcast space." According to Ryvicker and other analysts, online businesses probably contributed just 2% of radio's total revenues in 2007.