Advertising revenue for newspapers' online operations grew 21% in the third quarter to $773 million, according to figures released Tuesday by the Newspaper Association of America. Overall, online now
accounts for 7.1% of total advertising revenue in the newspaper industry--up from 5.4% in the third quarter of 2006.
The caveat: the strong online performance was more than offset
by a substantial 7.4% drop in overall ad revenue during the third quarter, to $10.9 billion. Considered separately, print ad revenues tumbled 9% to $10.1 billion. Continuing a trend from the last
several years, many of the losses came in print classified advertising, down 17% to $3.4 billion. The weak real estate market contributed to the 24.4% drop in the real estate category, while
recruitment dropped 19.7% and automotive was down 17.7%.
As in recent quarters, the drops in classified were joined by decreases in retail and national ad revenue--which fell 4.9% and 2.5%,
respectively, for a total $6.8 billion.
The good news about online revenue growth was also tempered somewhat by the fact that the rate of growth continues to slow on a year-over-year basis. In
2006, online revenues grew 31.5%, while in the first three quarters of 2007, the growth rates have been 22.3%, 19.2%, and 21%, respectively. This represents a slight decrease in absolute dollar
amounts.
In the first three quarters of 2007, online revenue added $400 million overall, as opposed to growth of $430 million in the same period of 2006.