Newspapers Face Ongoing Ad Declines

June 7, 2007

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Newspapers will continue to confront ad declines in 2007 and beyond, according to a new report from Deutsche Bank, writes MediaPost.

Among the key factors that DB analysts point to are the double-digit yearly declines in classified revenues.

DB forecasts real-estate classified revenue to fall about 9%, and job ads about 8.5%, in 2007. The biggest drop is expected to be in automobile classifieds, with a forecast of -17%.

Though online ads hold some promise for newspapers, the “point at which online growth can offset print losses is still years away,” DB is quoted as reporting.

Online revenues for newspapers grew 20% in 1Q07 from 1Q06, but the year-ago revenues were down 35% from 1Q05.

Newspaper sites are also less “sticky,” averaging 41 minutes of viewing per month – much less than for competitors AOL, Yahoo, MSN and Google.

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