Newspapers Will Be Left Behind As U.S. Ad Spending Recovers

U.S. advertising spending will increase about 3% this year, and it will rise about 35% over the next nine years, according to a report released today. That's the good news for the media industry. The bad news is that the increase will flow mostly to new media and not to newspapers and other, older forms of advertising.

Advertisers will spend $210.5 billion in 2010, up 2.8% from 2009, research firm SNL Kagan said in a report. U.S. advertising will increase next year to $214.3 billion, and it will surpass $275 billion in 2019, SNL Kagan said.

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The advertising recovery won't apply to the newspaper industry, however. Newspaper advertising will be $23 billion next year, down from $46.3 billion in 1999, and it should change little through the rest of the decade, according to SNL Kagan.

Such advertising trends have forced newspapers to cut staff and production runs to stem losses. For example, the Newark Star-Ledger, New Jersey's largest newspaper, is offering more buyouts for full-time employees after its publisher said its 2010 loss would widen to about $10 million, an increase from about $9 million last year, the Associated Press reported today, citing a staff memo from publisher Richard Vezza. Vezza hasn't set an estimate for cutbacks, the wire service said, citing an interview with the publisher.

Other forms of media are likely to benefit from the advertising recovery, however. Internet advertising will surge to $60.1 billion in 2019 from $4.7 billion in 1999, while cable-television advertising will more than quadruple to $55.1 billion between 1999 and 2019, SNL Kagan said.