Tuesday, July 10, 2007

Newspapers are the ad spending losers

No great surprise here, but E&P reports that newspapers are the big losers when it comes to cuts in ad spending.

Online is the big gainer, but as Wachovia Equity Research noted, online advertising would have to grow 15 percent a year for a decade to equal the $35 billion spent on newspapers.

(My prediction is that newspaper ad revenues will gradually settle to the $25 billion to $30 billion range, for a while at least. Online will gain significantly, but without the mass aggregation that brought a premium to mass media, its meteoric rise will slow. It's a case of human/business nature. Businesses want efficiency most of all -- they don't want to be tracking thousands and thousands of channels. Of course, this already is giving rise to new kinds of ad aggregator/brokers, those nimble enough to do that tracking and provide the multifaceted reporting that businesses need. But that's additional cost, and it will come out of the downstream ad buys.)

That all, of course, assumes that in a decade we'll actually be able to differentiate among all these media forms.

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