Ahmedabad:
The global online advertising industry appears to be
breaking the shackles at last.
If
the figures released by Interactive Advertising Bureau
(IAB) and PricewaterhouseCoopers (PwC) are any indication,
the revenues generated by this industry are on an upward
swing.
Worldwide,
the industry has recorded a quarterly increase in revenues
for the second successive year. According to another
study, Internet advertising revenues have gone up by
7 per cent to $1.7 billion in the first three months
of 2003 as compared to the last quarter of 2002. The
concomitant increase in revenues is 11 per cent.
The
success of the search engine advertising model that
accounted for 15 per cent of the online ad revenues
in 2002 has been a major contributor towards the overall
growth in revenues.
According
to PwC, paid search will account for 20 to 25 per cent
of the total online advertising sales. Growing adoption
of broadband Internet in the home segment is also expected
to boost online ad revenues.
Tom
Hyland, head of PricewaterhouseCooper's new media group,
has reportedly said the early results show that the
future for interactive advertising appears to be on
a strong footing and is poised for gradual and sustained
growth. "Many of the factors contributing to the
last quarter's up-tick seem to have held momentum, including
improved data for advertisers to analyse as they have
now been engaged in the market for a longer period of
time."
Obviously,
Internet advertising has gained significant momentum
across the world and has become a part of the media
mix that is being considered by advertisers. Research
predicts that worldwide, $33 billion will be spent on
online advertising by 2004. The Asia/Pacific region
will spend $3.3 billion, representing 5.9 per cent of
the region's advertising budget for that year.
According
to studies conducted on the penetration of the Internet,
it took the Internet under five years to attract a critical
mass of 25 per cent of US households, compared to seven
years for TV, eight years for radio and 28 years for
cable.
As
for the global entertainment and media industry spending,
it has been estimated that it will surpass $1.1 trillion
by the end of this year, up 3.7 per cent from its 2002
level, says PwC. Global entertainment and media spending
is expected to touch $1.4 trillion in 2007, for a 4.8
per cent compound annual growth rate over the next five
years.
Significantly,
PwC forecasts that by 2003-end, Asia-Pacific will have
surpassed the US as the world's largest broadband market
and by 2007, there will be 50-million broadband households
there. Globally speaking, new products and services
generated by digital technology and broadband will drive
market growth. Sums up PwC: "In the near term,
digitisation will cannibalise existing revenues."
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