Interest in online advertising high, but revenue lags

Borrell Associates, a research firm that crunches numbers on local advertising trends, today hosted Day 1 of a two-day, sold-out conference in New York City focused on online advertising.

The company predicted last fall that local interactive advertising would grow by a "relatively paltry" 5.6 percent this year, to $14.9 billion, and begin to level off by 2011. That's compared to annual growth rates in double digits over the past five years -- a worrisome development for legacy media hoping online sales might offset the precipitous drop seen in print ad revenue.

And while CEO Gordon Borrell -- a onetime newspaperman -- says he's "highly skeptical" that hyperlocal news on the Web can generate enough advertising to sustain itself, he's willing to keep an open mind.

Indeed, he posted on his company blog an interview with Jeff Jarvis, head of the interactive journalism program at the City University of New York’s Graduate School of Journalism, whose passion for the industry he praises.

Borrell says he has that passion, too, but is concerned a sustainable business model for local news on the Web hasn't been found yet. Jarvis led the Borrell panel today on "Turning Hyperlocal into Hyperprofit."

Here's the interview with Jarvis that Borrell Associates posted to YouTube. It's a bit long, but, yes, you can hear the resolve for keeping journalism alive.