Dot-com money may be drying up, but its advertising runoff seems like it will keep flowing.

Internet companies' newfound religion favoring profit over buzz has inspired advertising spending cuts. Those cuts, however, look like they'll have minimal effect on the non-Internet advertising market. And the online ad market, facing frugality for sure, is more likely to see slowing growth than a total wash-out.

Bob Coen, the director of forecasting for

Universal McCann

and a longtime tracker of advertising spending, on Tuesday estimated that the Olympics and the political season would take anywhere from $2 billion to $4 billion off the U.S. ad business table for 2001.

Coen finds it a lot tougher, however, to forecast the effect of dot-com dollars on the advertising business. "We know they're out there, and we know they're spending, and we know there's an extra stimulus," he says. But he doesn't see clear evidence of what people have talked about -- that there is indeed an advertising pullback. "I haven't seen any authoritative documentation that that's true at all, that these companies have pulled back," he says.

As for the state of the overall ad market, it likely will see some "moderation" in the third quarter, Coen says. The ad market is unlikely to return to the heady days of the first quarter of this year. "The fourth quarter might be, but I'm not too sure," he says. Next year, the U.S. ad market will grow, he predicted Tuesday, but not as fast as it did this year over last.

Old Media Malaise

Television and radio firms face a bigger problem than a dot-com money shortage in 2001, says Harold Vogel of

Vogel Capital Management

, a venture capital investor and hedge fund operator. That's mostly because of the missing revenue from 2000's special circumstances.

A company as large as

Viacom

(VIA) - Get Report

, isn't quite so vulnerable, Vogel says, partly because of its global operations and high ratings for its properties. (The media giant recently completed its acquisition of

CBS

.)

For smaller broadcasters such as

Sinclair Broadcast Group

(SBGI) - Get Report

and

Clear Channel Communications

(CCU) - Get Report

, however, the strength of the 2001 market still isn't clear.

"They are good companies," Vogel says, but adds, "I certainly wouldn't want to be aggressive about buying them. This is not the time to do that." Vogel doesn't own stock in these companies.

One participant in the online advertising market maps out a similar road map for Internet advertising over the rest of the year. Rich LeFurgy, general partner of the

WaldenVC

venture capital firm and chairman of the

Internet Advertising Bureau

trade association, says a steady influx of traditional advertisers to the Web is offsetting the loss of dot-com advertisers. He also says dot-com firms are pulling money they have traditionally spent off-line and putting it online.

"What we're going to see is a little bit slower growth rate," he says, as opposed to a decline in Internet advertising in the third quarter. About the fourth quarter, he is more optimistic. "My expectation is it will be a very strong quarter," he says, adding, "I don't necessarily want to use the word 'rebound.'"

For the most part, the weak advertising market is already priced into the stocks of companies that depend on online advertising, LeFurgy says. "If they make the estimates, they'll be fine. I think the ones that don't make the estimates will get spanked," he says.

The Big Get Bigger

Over time, LeFurgy says, the big companies in the online ad business will continue to be the big winners, he says. The latest figures collected by

PricewaterhouseCoopers

for the IAB indicate that the top-10 online media companies accounted for 74% of advertising revenue, and the top 50 accounted for 94%. "Gone are $10,000 to $20,000 test budgets, that were sprinkled around a number of sites," LeFurgy says.

Derek Brown, analyst at

W.R. Hambrecht

, sees a similar dichotomy in Web advertising dollars, adding that no company has been immune to the softness in the market. The primary driver, he says, is a tightening in funds for Internet-based companies. He says

Yahoo!

(YHOO)

,

CNET

(CNET) - Get Report

and

About.com

(BOUT) - Get Report

, three companies he follows, likely will meet or exceed earnings for the second quarter.

But, he noted in recent research -- in which he cut target prices for About.com and CNET -- that for the first time in recent memory, he doesn't expect to be raising earnings estimates for online advertising companies. In other words, optimism is hitting a ceiling. W.R. Hambrecht hasn't done underwriting for these firms.

Perry Boyle of

Thomas Weisel Partners

agrees. "I think the dot-com weakness has taken out a lot of the upside that people have been looking for," he says.

All eyes, he says, are on Yahoo!'s second-quarter earnings, due to be released July 11. "This is the gorilla stock," Boyle says. "If Yahoo! as a stock doesn't work, it's going to be very hard for other stocks to work in the sector."