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Through the first half of 2007, using results of publicly reporting newspaper companies as a proxy for the industry, total revenue was down nearly 5 percent and operating profit was off more than 14 percent.
Newspapers' performance hasn't been this bad since the 2001 recession, when revenue slipped nearly 6 percent and profit was down more than 26 percent. And this year the nation is not in a recession. But the newspaper industry surely is, and it is worthwhile examining why.
Advertising currently contributes 75 percent to 80 percent of most newspaper companies' revenue. Retail advertising from department stores and other merchants accounts for about half of this, and this category has been flat to down a bit in recent years...
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