Digital advertising revenue at U.S. newspapers rose just one percent from a year ago, the fifth consecutive quarter that growth has declined, according to the Newspaper Association of America.
A flood of excess advertising space, the rise of electronic advertising exchanges that sell ads at cut-rate prices, and the weak U.S. economy are all contributing to the slowdown, publishing executives and observers say.
For an industry savaged by the erosion of print advertising dollars, significantly boosting digital revenue is necessary for survival. But the double-digit online growth rates that many newspapers used to enjoy -- and on which their hopes for a prosperous future rest -- could be a thing of the past.
At the New York Times Co digital ad revenue at its news sites, including nytimes.com and bostonglobe.com, fell 2.3 percent to $48.5 million in the first quarter from a year earlier. At the Washington Post Co, the decline was even worse, with revenue dropping 7 percent to $24.2 million, mainly at the website of its namesake newspaper and online magazine Slate.