Online Spending Up 16 Percent

Driven largely by the growth in legal music services, U.S. spending on online content grew 16 percent to nearly $1 billion in the first half of the year.

Spending was at $853 million in the first six months of 2004, according to the Online Publishers Association.

Its study also finds that spending in entertainment and lifestyles services has surpassed the previous leader, personals and dating. People spent 45 percent more on music and other entertainment, compared with a 7.6 percent growth in finding love.

"We see an increasing appetite for consumers to turn to the Web not just for functionality but for fun," said Michael Zimbalist (search), the association's president.

Much of that results from increased availability of high-speed Internet connections, he said.

The study was based on tracking by comScore Networks and excludes some types of content including pornography, gambling and software.

Although the study did not break out figures for music, researchers credited that for most of the growth in entertainment. In that category, single-purchase sales (search) — a song, an album — reached $115 million in the first half, compared with $126 million for all of last year. Subscriptions still dominate, accounting for 57 percent of entertainment spending.

Business and investment services registered a modest gain after five consecutive quarters of decline, while spending on news services dropped 14 percent.

"There is so much free news on the Web that it's a challenge for news organizations," Zimbalist said.