The New York Times saw a shocking fall-off in advertising spending in December and says the weakness has continued into January. This follows comments by Yahoo that economic weakness hurt spending in some verticals in Q4. We believe this is the start of the advertising recession we have expected since last summer, and at the NYT, anyway, the speed of the fall-off was shocking (down 12% year over year, after being up in November).
We do not believe any advertising-driven companies will be immune from this fall-off. Internet companies are likely to be less-affected than traditional media companies, and pay-per-click revenue will likely be the least affected. But at the very least we expect to see a slowdown in the growth of all advertising spending, including on Google.
Companies likely to be affected include:
Time Warner TWX
Washington Post WPO
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