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Newspaper publishers have always believed they have a 'lifeline' to help them stay in business in the face of Internet competition. They have through that if they move their content away from print and onto the Web, while bringing their advertisers along with them, their companies could be saved. However, this lifeline may be fraying. The New York Times Company issued a warning that online advertising growth for 2007 will not be as strong as predicted. The same day, Tribune Company said the growth rate for its first-quarter 2007 revenue was much lower than that obtained in the previous year. Additionally, Gannett Company said its online revenue growth slowed during the first quarter compared to the same period a year earlier. Dow Jones & Company, which publishes the 'Wall Street Journal,' reported first-quarter growth in online advertising revenue increased by 30 percent in 2007, up from 26 percent in 2006. However, the Dow Jones business model differs from that of other publishing companies, since much of the paper's website is available by subscription only. This reduces the amount of traffic to the site, but lets the paper charge high advertising rates because paying subscribers are considered to be more committed. Industry analysts say that the results reported by the Times and Tribune firms illustrate a broader trend in which slower growth dominates. Newspapers tend to believe things will get better, but that is not always the case, says Kip Cassino, vice president of research at media-research firm, Borrell Associates.
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