This morning, print and online media giant News Corp (ASX: NWS) posted adjusted earnings of US$280 million on revenues of US$2.16 billion for the quarter ending 31 December 2015. On a currency adjusted basis total revenues were up 2% over the prior year, while adjusted earnings slumped 17% compared to the prior year.

Print keeps declining

The earnings slump is mainly a result of its print, book publishing, and cable network television offerings continuing to suffer from the fast-growing online competition.

News Corp’s results provide a clear insight into the digital future of the media as print advertising revenues declined, while digital advertising revenues grew across its news information services businesses and consumer-facing classified advertising businesses.

The company also flagged print volume declines at The Sun newspaper, while digital advertising revenues across its Dow Jones news services now account for around one third of advertising revenues in its news and information services businesses.

Foxtel facing growing competition

News Corp’s affiliated Foxtel business also posted a big decline in earnings due to higher costs across the board and likely increased competition from the likes of online rival Netflix. The increased competition for Foxtel means many customers are no longer willing to pay the relatively high subscription fees, when the internet is giving a new generation of consumers much more choice as to what they want to watch, when, and for what cost.

Digital real estate growing strongly

The best strategic decision of News Corp’s management team over the recent past has been to invest heavily in the growth of online real estate advertising as classified advertising revenue continues to migrate from print to online around the world.

The group’s key growth drivers are its investments in the fast-growing digital real estate services businesses REA Group Limited (ASX: REA) and US website Realtor.com. This as digital real estate services revenues grew 35% over the prior corresponding quarter.

News Corp has long been investing heavily in this space and its part-owned Australian business REA Group has also been spending heavily over the prior quarter to grow its global presence via the $751 million acquisition of Asia-focused digital property operator iProperty.

News Corp’s main rival in Australia, Fairfax Media Limited (ASX: FXJ), has also been investing heavily in its digital property asset Domain.com, but remains light years behind News Corp in the race to grow market share in the lucrative global real estate online advertising space.

News Corp shares have plunged 5.5% to a 52-week low of $17.02 on this morning’s news and despite its market-leading strength the rise of the internet continues to prove more of a headwind than tailwind as it attempts to adjust to the new reality of the digital economy.

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Motley Fool contributor Tom Richardson owns shares of REA Group Limited.

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Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.