Internet Ad Revenue Grows! Really?

The Wall Street Journal quotes a study  in an article published on June 15 that states flatly, the “Internet is set to overtake newspapers in ad revenue.” Another nail in old media’s coffin?

“The Internet is poised to overtake newspapers as the second-largest U.S. advertising medium by revenue behind television, according to PricewaterhouseCoopers’ Global Entertainment and Media Outlook for 2010 to 2014. […] The online ad business, excluding mobile ads, is set to expand to $34.4 billion in 2014 from $24.2 billion in 2009, according to the report. Newspapers, meanwhile, continue to suffer from a decline in advertising revenue. According to numbers released by the Newspaper Association of America earlier this year, print advertising revenue dropped 28.6% in 2009 to $24.82 billion. The PwC report estimates that print advertising in newspapers will hit $22.3 billion by 2014.”

Yet, The Economist recently wrote,

“Between 2004 and 2007, online advertising revenues doubled from $1.5 billion to $3.2 billion, according to The Newspaper Association of America. But in the second quarter of 2008, they began to fall, just as the loss of print and classified advertisements accelerated.” (The Economist, May 16, 2010)

On June 16, The Economist revisited that claim, stating:

“The Newspaper Association of America reports that print and [my emphasis] online advertising has fallen by 35% since the first quarter of 2008. Circulation has dropped alarmingly too. Yet almost all newspapers have survived, albeit with occasional help from the bankruptcy courts.”

Still, print performs much worse when it comes to advertisement, as written in this June 15 blog post by Reflections of a Newsosaur “Make No Mistake: Newspapers Are Still in Trouble“:

“American publishers missed out on the broad advertising recovery that took place in the first three months of this year.[…] The only positive growth posted by newspapers in the first period of 2010 — which also happened to be the first advance in any category in 24 months — was an increase of 4.9% in online advertising. But this pales in comparison to the over-all industry improvement of 7.5% in the same period, suggesting that newspapers are continuing to lose ground in even the vital interactive marketplace.”

I think nobody really knows what’s going on, and publishing a speculative assessment of what’s to come in online media in the next 4 years as PricewaterhouseCoopers has done, seems utterly useless to put it mildly.

Four years is a life time on the web.