Study: Online Newspaper Revenue Outpacing Overall Ad Growth

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By: Lesley Messer

Revenue for online newspapers grew faster than the overall online ad market in 2004 and they’re on a pace to do it again this year, according to a new report by eMarketer Online Publishing.

Online newspaper publishers saw revenue rise 38% last year and numbers from the first-half of 2005 indicate similar gains.

For the study, eMarketer examined yearly financial reports of 12 publicly traded publishing companies dating back to 2002. These publishers included: Gannett, Tribune Co., Knight Ridder, The New York Times Co., Dow Jones, Washington Post, McClatchy, Belo Online, E.W. Scripps, Media General, Lee Enterprises, and Journal Register.

One key factor behind publishers’ online gains is that Internet users are increasing their consumption of online content, particularly online news. Also, advertisers are beginning to take notice of online channels, bringing in more money.

As more companies — both advertisers and publishers — turn their attention to online, Ezra Palmer, eMarketer’s editorial director and the author of the report, said similar studies will be made more difficult.

?It’s going to get harder because a number of companies are doing a lot to converge their online and publishing operations,? Palmer said. ?It becomes difficult to say where one ends and the other begins.?

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