Tuesday, May 08, 2007

Newspaper Sites Growing Faster Than Web Overall

Newspaper Sites Growing Faster Than Web Overall
by Erik Sass, Tuesday, May 8, 2007 6:00 AM ET

THE AUDIENCE FOR NEWSPAPER WEB sites is growing faster percentage-wise than the Internet audience at large, according to a study commissioned by the Newspaper Association of America and released on Monday.

The study, done by Nielsen//NetRatings, found a monthly average of 59 million people visiting Web sites in the first quarter of 2007--representing 5.3% growth over the same period of 2006. Meanwhile, the pool of total Internet users in the United States grew about 2.7%.
These numbers "validate the industry's investment in digital innovation, and the ongoing attraction consumers have to newspapers online," said NAA president and CEO John F. Sturm in a statement. "Newspaper publishers have aggressively transformed their business models, continually providing ground-breaking content to consumers with their expanding digital portfolios."

What's more, the NAA data paints an appealing portrait of newspaper's Web audiences from an advertiser perspective, with the average user having a higher household income than the norm, according to Nielsen//NetRatings: 11.9% of Web users who visited a newspaper Web site have an income of $150,000 or more, compared to 9.3% of the overall Web population. Users of newspaper Web sites show a greater propensity to shop online, with 88.1% making an online purchase in the last six months versus 78.9% on average. They are more likely to hold a professional or managerial-level job, with 41% falling into this category versus 32.7% of the general Web population. In terms of Web behavior patterns, 73% are daily Web users versus 57.8% overall, while 42% have viewed streaming video on the Web in the last 20 days, versus just 27.4% for the average Web user.

All that is good news for newspapers, according to Shawn Riegsecker, chief executive officer of Centro, a leading ad network for online newspaper sites: "As newspapers continue to invest in their digital properties and produce world-class content, I predict they will capture a much larger percentage of the overall online pie."

Although their online audiences are still growing at impressive rates, newspaper companies are having a hard time monetizing those audiences at levels high enough to offset losses from print advertising declines. Worse, the rate of revenue and income growth at many newspaper Web sites appears to have slowed in the first quarter. Internet revenue rose 21.6% at the New York Times Company, down from 39% average growth in 2006. At the Tribune Company, interactive revenues rose 17% to $60 million--down from a 29% growth increase in 2006. And the Washington Post saw revenues rise just 10%, compared to 34% for the first quarter of 2006, on a year-over-year basis.

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