March quarterly advertising revenues for US papers have been published on the Newspaper Association of America website and show the lowest revenue figure for any quarter since 1987.
Total print and online ad revenues collapsed a record 28.2% to $US6.619 billion from the March quarter of 2008 when revenues totalled $US9.229 billion. The previous lowest was the $US6.6 billion in the first quarter of 1987.
Every class of ad revenue fell, some by more than 40%. In 2008 the falls were 40% in a year, now it’s that in a quarter. No other quarter reported by the Newspaper Association has seen a fall above 20%: the previous biggest was the 19% fall in the 4th quarter of 2008.
Over the six months from October to March, US newspaper ad revenues have plunged by around 24%. That’s unsustainable.
Get Crikey FREE to your inbox every weekday morning with the Crikey Worm.
The internet is doing some damage, the financial crunch and then the recession have done more, helped by the damage rising oil prices wreaked on US demand for cars, US car companies and car sales.
Forcing people to pay for content — Rupert Murdoch’s current campaign aimed at saving newspapers — won’t change that. Between 2000 and 3000 car dealers in the US are being jettisoned by Chrysler and General Motors. That means lower ad revenues for papers in small towns, suburbs and cities, and lower revenues for local TV stations which are suffering more than newspapers. Replacing that lost revenue with a dollar per click or micro payments will be a drop in the ocean.
Every advertising category, including online fell and the pace of the collapse accelerated. Online tumbled 13.4% to $US690.3 million in the quarter. That was the lowest since the third quarter of 2006 when online ad revenues were growing.
Every area of print advertising fell: Classifieds fell 42.7% to $US1.463 million, national advertising dropped 25.8% to $US1.132 billion and retail ads tumbled 23.6% to $US3.28 billion.
But among classifieds the falls were stunning. Car ads were down 43.2%, retail estate ads were off 45.5%, recruitment was off a massive 67.4% and “others” fell a more modest 16%.
And, if you look further into the breakdown of quarterly national and quarterly retail, you will see every comment saw the absolute dollar amount of spending fall in the quarter.
Given the falls reported for both the December and now the March quarters, its no wonder The Tribune Co and RR Donnelly went busy owing close to $US30 billion between them as ad revenues dried up.
The scenario seems as grim, for UK papers. The Group M buying agency cut its ad revenue forecast for UK media a third time overnight and now seems newspapers as a particular basket case:
“Newspapers are facing the sharpest deterioration, with print industry revenues now expected to fall 26 per cent to £3.65bn. The recession is accelerating a shift of classified advertising to the internet, with regional classifieds expected to fall 40 per cent this year.”