Analyst expects 2008 will get worse for newspapers

No big surprise here:

The July-August declines at NYTCO, Media General, Gannett, McClatchy, Lee and Scripps prompted Deutsche Bank analyst David Clark to warn that "industry trends softened across all categories" between the second quarter and the first two months of the third. That points to an even more dismal second half of the year.

"Based on the monthly results for GCI, MNI, NYT and MEG, we believe the trends have weakened for newspapers across the category spectrum" in the third quarter, Clark wrote. His calculations of the medium's overall performance were certainly sobering, with classifieds down 28%in the first two months of the third quarter, retail down 9.4%, and national down 12.9%.

Overall total advertising was down 17.2%--paving the way for the steepest quarterly drop in recent history.

According to the Newspaper Association of America, through the second quarter of 2008, total ad revenue has declined in year-over-year comparisons for eight quarters straight, meaning that current losses are compounding two years of previous losses.

Worse, the declines appear to be accelerating, from a 1.5% drop in the second quarter of 2006 to an 8.6% drop in the same period of 2007, and 15.11% in 2008.