Reduced Housing Ads Claim More Newspaper Victims

Starting Dec. 31, The Washington Post will cost 50...

Starting Dec. 31, The Washington Post will cost 50 cents–an increase from the 35-cent price it has been sold for since 2001.

The hike doesn’t necessarily mean the news is getting more costly to produce–but it does mean yet another U.S. paper is seeing the effects of the housing decline, which has been dragging down classified ad revenue for months.

Citing reduced advertising and circulation, the Post‘s newspaper operations revenue dropped 1.1 percent to $72.5 million in the third quarter ended Sept. 30. A 22 percent revenue increase at its Kaplan education division was the Post‘s saving grace, offsetting some of the damage, according to the Washington Business Journal.

Yet the Post is not alone in its ad troubles.

The Chicago Tribune–which is the second largest newspaper publisher in the U.S.–reported last month that its October revenue had fallen 9.3 percent because of lower classified ad sales.

On Tuesday, newspaper publisher Gannett Co. Inc.–the largest newspaper publisher in the country–reported pro forma newspaper advertising revenue dropped 3.9 percent to $420.4 million from $437.6 million in the same period last year, reports.

The reason? Lower interest in classified and national advertising sales. Classified revenue was down 11.2 percent compared with November 2006; real estate ad revenue plummeted 17 percent because of the slump, according to

Even The New York Times–which reported a slight rise in November continuing operations revenue compared to 2006–saw a drop in ad revenues. They fell 0.2 percent as circulation revenues rose 3.7 percent.

And–predictably–real estate, help-wanted and automotive ad revenues were down.

The company’s News Media Group saw ad revenue drop 1.6 percent–classified revenue dropped 19.5 percent, which counteracted national and digital ad growth, CNN reports.

And now, the Post is raising its price for the first time in almost seven years.

Will other papers follow suit? Will papers need to look for a new source of ad funding to supplement real estate listings, which will undoubtedly be low throughout much of next year? Will ad revenues ever return to their previous levels?

The outcome will be big news to consumers–and possibly also to the news industry.