News on Newspapers: They're Fading

Updated from Saturday, Mar. 8, 9:47 a.m. EST.

I write this with a heavy heart, because as a reader and writer I have a boundless love for newspapers. But as I've pointed out a number of times now, the business media, which also obviously loves newspapers too, needs to stop writing about them informed by little but wishful thought.

I feel your pain. But you have to stop seeing so much pleasure where there is none.

Here's the latest: Did you see the monthly sales number for The New York Times(NYT Quote), released this week? You see those terrible classified advertising numbers? How about the primary force of the coming collapse: the single-digit online growth numbers? Yes, folks, the same anemic online numbers that have been trending ever downward but were written up once again as the saving grace.

Here's how it all went down, and the operative word is "down."

Total ad revenue fell nearly 10%, a top-line benchmark that tends to signal a deeper level of decay from many troubled companies. Sure enough, Moody's(MCO Quote) and Standard and Poor's were soon on the scene, saying they would review the company's debt rating, which puts it on the fast-track toward junk and higher interest costs, part of the whole sad but steady process.

Some areas of classified advertising were down in the 30s, some in the 20s, but the Kings of Wishful Thinking from The Associated Press and National Public Radio weighed in on a figure that was, at least in absolute terms, up:

Here's AP: "One bright spot was Internet ad sales for the group, which climbed 8.6% as display advertising increased."

And NPR spoke about how the numbers, which "rose nearly 9%" were "good news" and "driving much of the push" toward dedicating even more of the company's increasingly precious remaining resources.

Let us be clear on this.

Online advertising numbers for newspapers have been trumpeted as the oxidizer for these companies, their lifeblood and savior in light of steep declines on the print side. Let's forget for a moment that, in reality, they are in large part just cannibalizing from the print side.

(Though the issue is often written in terms of that blessed moment in time when online will surpass print, neglecting to mention that the moment might only come because online is grabbing from print -- you try selling the same product through one distribution method for $600 and give it away through another and tell me the giveaway is merely additive.)

The point is: It's hardly even additive anymore.

It was not too long ago that the growth rate online for newspapers was in the 40% range. Coming off such a small base, it needed to stay there ... and for years. But it quickly dropped into the 30s. Then the 20s. Then we hit high teens and now this: single digits.

Though having a growth rate that registers in positive land obviously impresses some journalists, hoping for the best, the fact that the growth rate, in sequential terms, is going down without letup is terrible, no horrible news.

You can read all about it here, but it wasn't even two years ago that the leaders of newspaper companies were talking about the "transformational change" that would come about, what with online revenues growing by leaps and bounds many times what it is now. From leaps and bounds -- less than two years later -- we may have entered into what is the final bind for any dedicated newspaper company wanting to remain solvent and independent.

In terms of the coverage celebrating these single-digit gains, which received The Business Press Maven's dreaded "Back of the Hand" award, it was part of a long trend.