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IN THE past few years, Web publishers have made a big bet on booming online advertising revenues.

But the economic slowdown may be throwing a wrench into those plans.
While search advertising remains strong, there are signs that the growth in online advertising-particularly in more elaborate display ads-is slowing down.

In the past few weeks, major online-advertising players, like Yahoo and Time Warner, have posted mixed results.


And online publishers may be getting less money for the ad space they do sell. The prices paid for online ads bought through ad networks dropped 23 per cent from March to April, according to PubMatic, an advertising technology company in Palo Alto, Calif, that runs an online-pricing index.

Large Web publishers fared the worst in PubMatic's study, with the prices they received through networks dropping 52 per cent.
These are only preliminary results, and the economy could turn around more quickly than anyone expected even a month ago.

But, these numbers must be worrisome for Web portals, newspaper publishers and news media companies like CBS (which announced a $1.8 billion deal last week to buy CNet Networks) looking to expand their revenues from high-priced display advertising, like graphics heavy banners and column ads.


Display advertising at the network AOL declined 18 per cent, to $191 million. AOL is owned by Time Warner, which reported results last month.


"We were not satisfied with the performance of display advertising on our owned and operated inventory, which declined compared to last year's first quarter," said Jeffrey L Bewkes, the chief executive of Time Warner.


The growth in online advertising is also slowing at The New York Times Company In the most recent quarter, . internet ad revenues increased 16 per cent.

A year earlier, though, they were increasing at 20 per cent.
One area that remains strong is search ads. They are considered cheap and effective among marketers even in a potential recession - and they are how google makes the majority of its money In the most recent quarter, Google had a profit of $1.31 billion on revenues of $5.19 billion.

Its United States revenue was up 30 percent from last year.
Yahoo, which last year revised its guidance because of a weakening display market, had a first quarter that beat the average analyst expectations, with revenues rising 9 percent, to $1.82 billion.