Online advertising to grow 50 per cent annually

Online advertising, besides being 'smart and sexy' also spells big money. It was worth Rs1,000 crore in India in 2010 and is expected to witness a 50 per cent jump this year, according to Rajan Anandan, managing director, Google India.
 
Sharing his thoughts on the future of online advertising, Anandan told participants at GoaFest 2011 – India's biggest ad festival – when it comes to the internet, India has reached an inflection point.
 
In 2010, there were 100 million internet users in India, of which 40 per cent accessed the net from their homes and another 40 per cent from the workplace.
 
While the online advertising business was erroneously termed a 'cottage industry,' he said it would witness a 50 per cent growth in 2011, with billings adding up to a hefty Rs1,500 crore. While online advertising accounted for a mere four per cent of total advertising spends, the figure is expected to rise sharply over the coming years, he added.
 
And with mobile penetration also increasing in India – it was up by 20.2 million subscribers in February, touching 791.38 million; (See India's mobile phone subscriber base up by 20.2 million in February) – an increasing number of users access the net through their cell phones.
 
According to the Telecom Regulatory Authority of India (TRAI), broadband subscription rose to 11.47 million towards the end of February 2011, from 11.21 million a month earlier. The broadband internet base is expected to reach the 100 million-mark by 2014.
 
Telecom operators who won the 3G licenses last year plan to roll-out their services over the coming months, boosting the net subscriber base.
 
Anandan said by 2014, online advertising would be worth a billion-dollars in India. About 40 million users accessed the net from their mobile phones already and the numbers will keep increasing with the roll-out of 3G services. ''People think mobile is still nascent, but look at the numbers – mobile is quite established in this country,'' he said. ''Today, you can do rich media and video advertising on the mobile phones.''
 
The theme for GoaFest 2011 – the sixth edition of the festival – was 'Ideas are all around us – can you spot one?' The event is being organised by the Advertising Agencies Association of India and the Advertising Club Bombay.