Total U.S. advertising expenditures declined 0.3 percent to $72.5 billion in the first half of 2007, the first time that ad spending has fallen for two consecutive quarters since 2001, according to TNS Media Intelligence.

"While the protracted downturn in automotive spending has been a prime contributor, the overall results reflect weakness across a wide range of industries and advertisers. Given the uncertainties about near-term economic growth and consumer spending, we expect core ad spending will continue to face challenges during the second half of the year," Steven Fredericks, president and CEO of TNS Media Intelligence, said in a statement.

According to TNS data, newspapers dropped most seriously in ad spending compared to other media. Overall, ad expenditures dropped 5.8 percent to $12.9 billion. Local newspapers declined by 5.8 percent to $11 billion, while national ad expenditures were down 6.4 percent to $1.6 billion. In Spanish-language papers, ad spending fell 4.4 percent to $172 million.

Meanwhile, online ad spending soared 17.7 percent to $5.5 billion.

According to the report, newspapers lost share as well. This year, 17.8 percent of advertising was spent in newspapers, down from 18.8 percent from the same period a year ago. Online advertising increased its share in overall advertising breakdowns, edging out radio. Ad spending online is growing at 7.6 percent, compared to 6.4 percent for the same period a year ago. Radio's share dropped to 7.1 percent from 7.3 percent.