Newspaper revenues plunge again


The Newspaper Association of America (NAA) has posted ad sales figures for Q3 which are nearly as dismal as for Q1 and Q2. Even online ad sales for newspapers posted their sixth straight quarterly decline.

Total revenues were down 27.9% in Q3 (vs Q3 2008) to $6.44 billion. Classified was hardest hit, falling 37.9% to $1.47 billion. National was down 29.8% to $956 million – the first quarter of any year below a billion dollars since Q3 1995. Retail, while still far and away the largest segment, was still down 24% to $3.4 billion. In all, traditional print advertising revenues were down 29% to $5.82 billion.

Newspaper online revenues declined 16.9% to $623 million. So far, 2009 online revenues have been back to levels much like 2006 – except that back then they were still growing by double-digit percentages.

“Given the depressed state of the overall economy, and earlier third quarter financial reporting by publicly traded newspaper companies, the Q3 industry-wide advertising revenue summary should come as no surprise. Rather, these numbers are in line with most expectations, and even show some modest directional improvement in key categories like retail and national. More importantly, this look back at recent history is not where the focus of our industry’s attention lies,” said NAA President and CEO
John Sturm.

“NAA member newspapers are looking to the future – to the broadly noted indications that stability, recovery and growth are on the horizon – and to evidence that important advertising categories are showing signs of renewed vigor. There may not be great visibility into 2010 and beyond, but the broad consensus is that the worst has passed. Throughout the downturn, newspaper companies have made extraordinary progress in transforming their business models, positioning themselves as leading players in a multiplatform media universe where their superior audience engagement, content generation, and value for advertisers will ensure a successful future,” Sturm added.

RBR-TVBR observation: At least the newspaper industry will have easy comps next year. Certainly a lot of the classified business is gone forever, lost to the Internet. For major newspaper chains, the national ad erosion has to be of concern as well. National advertising in newspapers was dropping long before the current recession hit. It has been down now for 19 consecutive quarters. That trend started a year and a half before classified ad revenue trends turned negative. A lot of national advertisers are just no longer interested in using newspapers.

Any recovery for the newspaper business is going to have to be driven by local retail and Internet ad sales. Competition from radio and television is currently intense for local ad dollars and will continue to be in the future. As for the Internet, just about everybody is trying to grab some of that ad spending.