RealTime IT News

Online Advertising Outdoes The Pack

Even amid rising concerns over near-term economic growth and consumer spending, Internet display advertising expenditures from January to June this year grew to $5.6 million, up 17.7 percent from the same period a year ago, according to a report from TNS Media Intelligence.

"For the first time since 2001, media advertising expenditures have declined for two consecutive quarters," president and CEO of TNS Media Intelligence Steven Fredericks said in a statement.

"Given the uncertainties about near-term economic growth and consumer spending, we expect core ad spending will continue to face challenges during the second half of the year."

The sobering prognostication doesn't bode well for ad spending in offline media if their 2007 numbers thus far are any indication.

Television ads decreased 2.4 percent to $31.6 billion. Newspapers dropped 5.8 percent to $12.9 billion. And radio decreased 2.7 percent to $5.1 billion, a drop that matches an eMarketer report earlier this month that, for the first time, online advertising will surpass radio advertising spending in the U.S.

Newspapers are losing revenue to online advertising, too. Industry watchers typically blame online classifieds sites such as Craigslist and eBay, as well as search marketing.

However, online advertising dollars haven't pinched everyone out of revenue. Magazine ad spends rose 4.6 percent, as growth in Spanish-language magazines, consumer magazines and Sunday magazines offset a downturn in spending on business-to-business, as well as local magazines.

The numbers also seem to suggest that television's loss, about $769 million in ad spending, is an Internet advertising gain of about $829 million. But that might be an over-simplification.

About.com CEO Scott Meyer, whose site runs its share of ad-supported videos, recently told InternetNews.com that the broadcast television model for video content production isn't broken yet.