Study finds few profitable online publishers

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Fewer than 20% of publishing companies surveyed by the Magazine Publishers of America are realizing profits from their online activities. But surprisingly, advertising is a much smaller source of revenues for online publishers than may have been thought. For the 47 publishers surveyed, advertising generates 53% of revenue. Online production for advertisers or customers contributes a sizable 22% of revenue. Subscription fees account for only 5% of revenue. On average, publishers invest more than $2.5 million per year in their online efforts, and they expect online expenditures will increase significantly during the next two years. The study was conducted for the MPA by Ernst & Young's Technology, Communications and Entertainment practice. Excerpts are available at Ernst's Web site.

Copyright March 1997, Crain Communications Inc.

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