Newspaper Web site revenue continues to surge as on the print side it continues to plunge, says the Newspaper Association of America in a year-end estimate.
On the Internet side, it increased to almost $2.7 billion, a 31.5 percent increase. On the print side it dropped to $13.2 billion, or a 3.7 percent decrease for 2006.
The good news for the fourth-quarter is that it reached $745.5 million which was an estimated 35 percent increase in ad revenue online, the 11th straight quarter that's happened.
Even with the numbers increasing online, the overall newspaper advertising industry isn't looking good. The combination of online and print ads fell by 2.2 percent in the fourth quarter to $14 billion.
Merrill Lynch analyst Lauren Rich Fine said in a report this week, "when will the gains online offset the declines in print ... In fairness, we do not believe there is an answer to that question yet."
I agree with her. The various forces in play may it impossible to project within this industry now. Even within the categories themselves there is change that is impossible to know how it will end.
For example, the classified sector is in turmoil as in some spaces it's been increasing and other declining in huge ways. The automotive industry dropped by 12.8 percent to 4 billion, along with job recruiting, which plunged by 7.5 percent. On the other hand, real estate grew by 11 percent. The overall classified sector dropped by 1.9 percent to $17 billion.
This is going to go on for a long time as growth continues online and increasing competitive forces get their piece of the advertising pie. The industry will be unpredictable for years to come.
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