Tags: Internet | Revenue | Hits | Record | Billion

Internet Ad Revenue Hits Record $8 Billion

Monday, 25 September 2006 12:00 AM

NEW YORK -- U.S. Internet advertising revenue rose 37 percent in the first six months of the year, hitting a record of nearly $8 billion, according to a study released Monday.

The study, released by the Interactive Advertising Bureau and PricewaterhouseCoopers, comes just days after a revenue warning by Yahoo Inc. raised concerns that ad spending in new media could be slowing.

In warning about its revenue, Yahoo pointed to weakness in advertising from automobile and financial firms, two key sectors in marketing. Since the disclosure, analysts have been divided over whether the issue is solely Yahoo's or signals a wider slowdown in online ad spending.

Until now, signs have pointed to strong growth for online ads, largely at the expense of newspapers and radio. Monday's figures suggest that at least through the second quarter, Internet advertising revenue continued to surge.

For the second quarter, Internet advertising revenue totaled nearly $4.1 billion, a 36 percent increase over the same period in 2005, and up 5.5 percent over the first quarter of 2006.

Search-related advertising rose 40 percent in the first half of the year, while classified rose 20 percent, according to the study, released during a week of advertising industry presentations in New York.

"With the seventh consecutive quarter of growth behind us we are confident that the Internet will continue to reconcile the imbalances between its share of media consumption versus its relative share of total advertising spend," said Pete Petrusky, director, Entertainment & Media Practice at PricewaterhouseCoopers.

A group of media companies, meanwhile, forecast Monday that online advertising growth should rise in the third quarter.

The Online Publishers Association, which includes CNET Networks Inc., iVillage, Reuters and Tribune Interactive, said its members expect online ad revenue to grow about 28 percent for the third quarter.

The group said most members are seeing strength in all advertising categories with no areas appearing to slow down.

(c) Reuters 2006. All rights reserved.

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NEW YORK -- U.S. Internet advertising revenue rose 37 percent in the first six months of the year, hitting a record of nearly $8 billion, according to a study released Monday. The study, released by the Interactive Advertising Bureau and PricewaterhouseCoopers, comes...
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2006-00-25
Monday, 25 September 2006 12:00 AM
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