• Dow Jones, Friday, December 19, 2008 10 AM

Ad market forecasters have been scaling back their outlooks for months, but media economist Jack Myers has upped the ante with his prediction of an advertising depression. His forecast, which aggregates industry estimates with his own analysis, examines 18 media categories, including new media.

Myers sees an unprecedented three straight years of declines in advertising and marketing spending in the U.S., starting in 2008. To put that in perspective, the industry hasn't suffered even a two-year spending decline in advertising since the 1930s.

The pullback in ad dollars will weigh heavily on the media sector, he says, with ad agencies taking the hardest hit. The issues are not so much economic, but "secular and systemic. It's like moving from an agrarian economy to an industrial economy." The problem is that while the overall marketplace is in crisis, "it's very hard for companies to make the changes that they've needed to make for a decade now in any kind of orderly way."

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