Internet ad revenue tops $21B, but growth is slower February 26, 2008
So while reaching the $21 billion plateau for the first time sounds great, the growth of internet ad revenues is also slowing down.
The data, collected by the Interactive Advertising Bureau, suggests revenues grew an estimated 25 percent last year, up from $16.9 billion in 2006. That’s a whole 10 percentage points lower than the previous year’s growth. Even the dollar figure was lower, with a $4.2 billion increase compared to $4.3 billion in 2005.
The increasingly torpid growth was forecasted by many analysts though. As the internet continues to soak up more of the advertising stream, this has meant less money for traditional outlets like newspapers. Still, the internet only occupies about 10 percent of all American ad spending, which means plenty of room for growth, albeit slower.
There are some variables that may contribute to the slowdown in growth not accounted for IAB's figures. We’re arguably in a recession, and one of the first things companies do when the pockets get thin is cut ad spending. Some of the big boys like MSN, Yahoo!, and AOL are even having a rough go of it lately.
A full breakdown of the numbers is expected to be released by the Interactive Advertising Bureau in May.
