Internet ads seen surpassing print newspaper ads in 2010

NEW YORK -- A study finds that U.S. consumers are increasingly shifting their attention away from traditional, advertising-supported media in favor of entertainment such as the Internet, video games and cable TV, which consumers pay for.

As a result, the boom in online advertising is expected to continue, with all Internet advertising spending -- including ads on Web sites of traditional media outlets -- overtaking print newspaper advertising in 2010 as the largest advertising category, according to a report released Tuesday by Veronis Suhler Stevenson, a media investment firm.

From 2001 to 2006, the average amount of time spent by the typical consumer on paid media jumped 19.8 percent. In the same period, overall time spent with traditional or ad-supported media -- such as broadcast television, radio and newspapers -- fell 6.3 percent, the study found.

The study predicted that total Internet advertising will grow an average of 21 percent through 2011, including online-only outlets such as Yahoo Inc. and Google Inc. as well as digital revenue from traditional media outlets such as newspaper publishers and TV broadcasters.

In 2010, that would put overall online ad spending at $54 billion, overtaking print-only newspaper advertising as the largest category, which is expected to stand at $51.5 billion that year.

At the same time, the study also predicted rapid growth in the amount of digital advertising that newspapers would take in, jumping from $3.2 billion last year to $7.7 billion in 2010.

As of 2006, ad-supported media still had a 53.8 percent share of the total amount of time people spent with media, versus 46.2 percent on for-pay media, which include the Internet, cable and satellite TV, movies seen in theaters, books and recorded music.

At the same time, the study found that the total amount of time spent on all types of media actually declined slightly last year for the first time since 1997, dipping 0.5 percent to an annual total of 3,530 hours.

Leo Kivijarv, vice president of research at PQ Media, a media research consulting firm that worked on the report, said the slight decline came after several years of growth amid rapid adoption of new kinds of hardware and services such as high-speed Internet connections, satellite TV and digital video recorders.

With many of those services now already purchased by those who want them, Kivijarv said that time spent with media had reached a saturation point.

Also, researchers found that users generally spent less time with online media than they did with traditional media such as newspapers. Since people are online more often, that has led to an overall decline in total time spent consuming all media.