Newspapers went from bad to worse; they experienced a double digit drop in advertising revenue – their primary source of income. Housing markets have slumped, therefore limited real estate advertisements, and fewer classified ads. The internet is a newspapers’ public enemy #1 (with web based advertising revenues growing 20-30% a year).
Overall, ad revenue fell almost 8% last year – this year is forecasted to be over 12%. Newspapers attempt to reduce costs through fewer pages, smaller size newspaper, eliminating distribution routes, lighter weight paper, consolidating plants, and laying off labor but profit margins continue to erode.
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