(MADRID) The global financial crisis poses a major threat to free newspapers worldwide, industry officials said at the first-ever world conference of the industry on Tuesday.

The sector, which is made up of 230 free newspapers in 58 nations with a total daily distribution of 43 million copies, is 'extremely vulnerable to a recession', said University of Amsterdam media specialist Piet Bakker.

'It will be particularly hard for free newspapers with no operations in other sectors, who are not part of companies with other activities. If you only have advertising, you really have a big problem,' he said.

The most vulnerable free newspapers are those that publish in the afternoon, those that focus on sports and those which only started printing recently just as the global economy began to sour, said Mr Bakker.

The challenges faced by the sector were underscored earlier last month when one of the four free dailies published in the Netherlands, DAG, closed down after less than a year and a half in operation.

The paper was one of 12 free dailies to close down so far this year, after 23 stopped publishing in 2007, said Mr Bakker.

'We are going through a period of crisis and the days to come are black,' said Fernando Martinez-Vallvey, a communications professor at Spain's Salamanca University.

In July, the world's largest publisher of freesheets, Swedish-owned Metro International, reported a bigger-than-expected 83 per cent drop in second-quarter operating profit due to weak advertising sales.

Arsenio Escolar, the director of one of Spain's four free dailies, 20 minutos, which is also the country's most read newspaper, said revenues at his paper had dropped by less than 20 per cent. He said free newspapers must band together and form an international federation that can lobby for favourable conditions.

'Paid newspapers are organised, the free ones must do the same,' said Mr Escolar, who is also head of the Spanish Association of Periodical Publications' Editors.

Free newspapers have redrawn the media landscape since they emerged on a large scale in the 1990s, especially in Europe where they account for 23 per cent of the market with 120 titles in 32 countries.

Roughly 350 participants from 26 countries took part in the three-day gathering in Madrid. -- AFP