New information has come out that confirms what we talke about here at the alphamarketer, that online ad spend is growing fast than expected, according to a report by Business Week.
Citing a eMarketer study, the research company has now increased its estimate for 2006 by another $500 million, now standing at $16.4 billion overall for online ad spending. The two industries most affected by this will be the radio and newspaper.
The new estimate places online advertising at around 5.8% of the total advertising spend for the year. Amazing, when you consider the time radio has been around and it takes in 6.9% of overall advertising spending. Sometime next year online spend is now expected to pass radio ad spend for the first time. By 2008 it is expected to reach 8.1%, exploding past radio.
Forrester Research is even more aggressive saying that internet advertising will reach 417.4 billion this year - a full billion more than eMarketer says. If that's true, the percentage of online ad spending is growing far greater than anyone has suspected; i'ts not going to end any time soon.
This also confirms that some of Yahoo's (YHOO) slowdown is connected specifically to them and not the overall industry. The increasing competition from other like AOL (TWX), News Corp. (NWS) and Google (GOOG), along with thousands of newspaper and content sites is diluting their revenue specifically.
Ad supported sites should grow great for a long time to come.
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