Online Publishers See Gathering Ad Momentum

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News publishers reported growing revenue and strong demand for advertising at their online arms in the fourth quarter, continuing a gathering online advertising recovery.


New York Times Digital, which publishes NYTimes.com and Boston.com, said this week that its sales grew 27 percent in the quarter to $25 million. The online unit's operating profit doubled to $7.2 million from the year-ago period.


Likewise, the Washington Post Co. said its online publishing arm increased revenue 34 percent to $14.2 million. The Post said it saw strong demand for its local and national advertising, which grew 54 percent. The company does not break out profits from the online division.


The results underscore an online ad recovery that began last year and should continue in 2004, analysts say. Investment bank U.S. Bancorp Piper Jaffray expects online advertising to grow 21 percent in 2004 to $8.1 billion.


On Jan. 28, ad technology provider DoubleClick said it saw huge increases in ad-serving volume for the fourth quarter, which helped it post strong profits. Its rival ad server aQuantive similarly reported growing volume of ads served through its Atlas DMT unit.


At NYTD, CEO Martin Nisenholtz said it continued to expand its client base, attracting advertisers through special packages such as NYTimes.com's movie section.


Nisenholtz also credited NYTD's half-page ads, which have drawn big-name advertisers like Cadillac and Tiffany. NYTD said the half-page units brought in $1.2 million from their launch in April until the end of 2003. NYTD also said its "surround sessions," in which an advertiser can buy ad space for a user's entire visit, took in $1.7 million in 2003.


"We have definitely attracted new categories and new advertisers to the mix," he said.


Nisenholtz predicted NYTD would look for further ad opportunities through search and multimedia. He said the NYTD's sites might even run short Web commercials.


Other news publishers reported solid advertiser demand. Tribune Co., publisher of the Los Angeles Times and Chicago Tribune, said its interactive unit's revenue rose 37 percent to $26 million, reflecting growth in both classified and display advertising.


Last week, Knight Ridder Digital, which publishes the Web sites for newspapers like The Philadelphia Inquirer and San Jose Mercury News, said its sales increased 44.2 percent in 2003 and returned a $15.2 million profit. Knight Ridder CEO Tony Ridder called KRD's performance "absolutely splendid."


MarketWatch.com, publisher of CBS MarketWatch, saw its ad revenue grow 40 percent in the fourth quarter to $7.6 million. In addition to more business from tech, finance and travel advertisers, the company said it profited from its paid search links.


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