13.2.07

Online ad spend tops $1 billion

by Asher Moses

Australia's online advertising market grew 61.5 per cent last year, with the full year spend just topping the $1 billion milestone.

The stellar growth rate suggests it will not be long before advertising spending online exceeds that of all other mediums.

The figures were released today by the Audit Bureau of Verification Services - part of the Audit Bureau of Circulations - and greatly surpass the 40.3 per cent growth rate projections made by PricewaterhouseCoopers in its 2006 report titled Australian Entertainment and Media Outlook: 2006 - 2010.

Comparative figures showing last year's advertising spend for competing mediums, such as newspapers, were due to be released next month, PwC partner Steven Bosiljevac said.
In 2005, advertisers spent $620 million on online advertising, which was markedly lower than the newspaper, magazine, radio and free-to-air television spends of $3.79 billion, $978 million, $898 million and $3.216 billion, respectively.


But behind the high dollar figures were flat 2004-2005 growth rates of 5.1, 9.3, 6.6 and 2.4 per cent respectively, the PwC report said.

These pale in comparison to the 61.5 per cent growth enjoyed by the online market last year (up from a 2005 growth figure of 59.6 per cent), suggesting it won't be long before online is the dominant medium.

"Now that the $1 billion mark has been broached, we expect to see 2007 figures soar," Internet Advertising Bureau general manager Patty Keegan said.

Jack Herman, executive secretary of the Australian Press Council, played down concerns that so-called "old media" newspaper publishers were being driven out by new online players.
"What we are seeing is a proliferation of media rather than the new media driving the old media out," Herman said.


He said the "established", larger media players still enjoyed the lion's share of online advertising revenue, so the threat posed by the internet was not as pronounced as some have speculated.

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