Posted May 20, 2008 8:04 am by with 4 comments

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Online advertising in general is fairing well in a slow economy. However, display advertising revenue, especially for bigger websites, is not doing as well. (Marketing Pilgrim runs display ads – Andy how are they doing – notice any downturn?).

Web sites, newspaper publishers, and news media companies like CBS make money by selling display ads. Remember all the new ad networks that have popped up in the last few years? Publishers are getting less for the ads they run through those networks.

PubMatic’s online pricing index showed that the price for ads purchased through an ad network dropped 23 percent from March to April. It’s worst for the largest sites – the prices for that segment dropped 52 percent. Ad networks are responding by more precise targeting of ads.

The New York Times Company saw quarterly revenue for Internet ads, but not as much as last year. Revenues increased 16 percent compared to 20 percent last year.

The market is showing more cautious buyers. WebMD Health lowered their expectations as they saw advertisers commit to shorter commitments., noted how new advertisers want to test their ads to see how they perform, before committing.

Search engine advertising is up and the leader for those ads is Google. Its United States revenue was up 30 percent from last year. Marketers often prefer online advertising to print ads because the results are usually better and more measurable.

Yahoo’s first quarter results beat the average analyst expectations, and saw revenues rise 9 percent but they didn’t note how much was display compared to search engine ads.

How about Microsoft? “Microsoft’s advertising revenue, excluding its acquisition of aQuantive, an online-advertising company that Microsoft bought for $6 billion a year ago, grew by 29 percent, up from 23 percent in the quarter a year earlier. However, overall profit dropped by 11 percent, to $4.39 billion.”