Online advertising in Australia continued to march ahead in the first quarter this year, albeit at a slower pace than over the previous four years, The Australian reported.

The total Internet ad market grew 30.8 percent to AU$385 million in the first three months. Compared with the same period last year, it dropped from a 51-percent increase in 2007.

Classified advertising was the star performer, up 34 percent to $106.5 million, The Australian reported.

General display advertising grew 26 percent to $95 million, slightly better than market expectations. However, a slowdown is expected because of stock market woes in financial services advertising could draw growth down later this year.

Anthony Saines, general manager of Sensis Digital Marketing Services, said he expects a market growth in the high 20 percent range during the second half of this year despite the possible slowdown.

Kerry Field, MindShare Interaction chief, said the growth rate was positive, given that total online advertising exceeded $1.35 billion last year.

"There are still some big growth opportunities," she said, according to The Australian. "I just think it's a natural slowdown."

The classified sector made up 27.7 percent of the online ad market, stealing ground from general display advertising, which fell in share to 24.6 percent, The Australian reported.

Search and directories advertising rose 31.5 percent to $184 million. Its share also grew slightly to 47.7 percent of the market.