By: ANDREW VANACORE/The Associated Press
(AP) Newspaper advertising and subscription revenue in North America will continue to drop through 2012, according to a new forecast by PricewaterhouseCoopers.
The accounting firm’s report suggests newspapers still have a painful time ahead of them after spending the last two years or so furiously cutting costs to keep up with shrinking revenue sources.
“We’re still seeing a long-term migration of readers and advertisers to the Internet,” PricewaterhouseCoopers partner Bob Barrett said in an interview.
Though newspapers make money by selling advertising on their Websites, those ads go for much less than printed ones.
The forecast released Tuesday shows print ad revenue for newspapers in North America dropped by nearly 47 percent from 2005 to 2009, from $49.7 billion to $26.4 billion.
Over the same period, digital ad revenue rose by 33 percent but still amounted to just $2.7 billion last year.
Pricewaterhouse does not expect the picture to improve much in the near term. It predicts another 19 percent drop in print advertising revenue and a 9 percent drop in circulation revenue through 2012 before a healthier overall economy starts to stabilize the industry.
Digital ad revenue is expected to rebound faster. Pricewaterhouse projects it will decline about 8 percent between 2009 and 2011 and begin to pick up in 2012. Still, it will only account for about 11 percent of the total by 2014.
Newspapers are still thriving in some places outside North America where broadband Internet access hasn’t spread as far. In Latin America, for instance, print ad revenue has been growing steadily since 2005.
In the U.S., the Web’s effect has been devastating. The American Society of News Editors estimates that U.S. dailies have shed about a quarter of their newsroom personnel since 2001, bringing the total down to 41,500.