• by Wendy Davis  @wendyndavis, June 1, 2005

Internet powerhouses Google and Yahoo! have "rewritten the information industry playbook," according to a recent report by research firm Outsell, Inc.

The study, an analysis of 2004 revenues of 100 publicly traded information companies, stated that sponsored search listings from Google and Yahoo! are "sucking the financial air out of the room."

Google and Yahoo! combined generated $6.5 billion in total revenue last year, compared to a total of $60 billion by the 10 largest companies (Reed Elsevier, Thomson, Gannett, Pearson, Tribune, Reuters, McGraw-Hill, VNU, Wolters Kluwer, and the Daily Mail and General Trust) according to Outsell's analysis. But when it comes to new revenue, Google and Yahoo! also have generated $4 billion--the same amount as the 10 largest companies combined.

Outsell wrote that Google and Yahoo! are "clearly diverting advertising revenue" directly from the newspapers and magazines owned by the 10 largest information companies. In fact, Outsell found that the newspapers owned by the New York Times Co. are struggling as the industry in general tries to "recapture ad revenue growth and young audiences."

Additionally, Outsell determined that four other information companies--Ask Jeeves, FindWhat.com, eCollege.com, and T&F Informa--more than doubled their growth in 2004.