Internet Advertising Revenues Top $21 Billion in '07, Reaching Record High : Q4 '07 Revenues Total $5.9 Billion; Unabated Growth Defies Other Economic Trends

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The Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers LLP (PwC) today announced that the 2007 Internet Advertising Revenue Report shows Internet advertising revenues in the U.S. continued their upward climb.

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This achievement is a testament to the continued vitality of interactive

For the full year 2007, revenues totaled $21.2 billion, exceeding 2006 performance by 26%, itself the former record year. Q4 2007 Internet advertising revenues hit $5.9 billion, representing historic revenues for a single quarter and a 24% increase over the same period in 2006. This is the fourth consecutive year and 13th consecutive quarter of record results. "This achievement is a testament to the continued vitality of interactive," said Randall Rothenberg, president and CEO of the IAB. "Explosive innovation in the industry is providing marketers with new and unique ways to reach consumers—it's a very exciting time."

Search, display, classifieds and lead generation all continued growing at a healthy rate, according to the report. Consumer advertisers remained the largest category of Internet advertising spending, at 55% of 2007 full-year revenues, up from 52% from the full year 2006.

"Despite the current state of economic uncertainty, 2007 was another record year and the 13th consecutive record quarter. Interactive advertising is not just the future, it is the here and now, as it represents a meaningful and growing component of U.S. advertising and marketing spend," said David Silverman, partner, Assurance, PricewaterhouseCoopers.

ADVERTISING FORMATS   2007   2006 Type of Advertising   $   % share

of market

  $   % share

of market

Display Advertising 4,455   21% 3,685   22% Sponsorship 636 3% 496 3% Rich Media (06 including Broadband Video) 1,657 8% 1,192 7% Digital Video (07 only) 324 2% All Display 7,072 34% 5,373 32% Keyword Search 8,805 41% 6,799 40% Classifieds 3,321 16% 3,059 18% E-mail 424 2% 338 2% Lead Generation*   1,584   7%   1,310   8% TOTALS:   21,206   100%   16,879   100% INDUSTRY CONCENTRATION         FY 2007   FY 2006 Top 10 69% ($14,632)   69% ($11,647) Top 25 80% ($16,965) 82% ($13,841) Top 50   89% ($18,873)   92% ($15,529) PRICING MODELS             FY 2007   FY 2006 CPM or Impression 45% ($9,492)   48% ($8,102) Performance Deals 51% ($10,817) 47% ($7,933) Hybrid   4% ($897)   5% ($844) Conducted by the New Media Group of PricewaterhouseCoopers, the Internet Advertising Revenue Report was launched in 1996 by the IAB, and aggregates data from all companies that report meaningful online advertising revenues. The results are considered the most accurate measurement of interactive advertising revenues with the data compiled directly from information supplied by companies selling advertising on the Internet. The survey includes data concerning online advertising revenues from Web sites, commercial online services, free e-mail providers, and all other companies selling online advertising. First and third quarter revenue reports are estimates, with the actual figures being released along with second and fourth quarter data respectively. PwC does not audit the information and provides no opinion or other form of assurance with respect to the information.

For a copy of the full report click here.

The IAB sponsors the Internet Advertising Revenue Report, which is conducted independently by the New Media Group of PwC. The full report is issued twice yearly for full and half-year data, and top-line quarterly figures are issued for the first and third quarters.

About PricewaterhouseCoopers:

PricewaterhouseCoopers (http://www.pwc.com) provides industry-focused assurance, tax and advisory services to build public trust and enhance value for its clients and their stakeholders. More than 146,000 people in 150 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice.

PricewaterhouseCoopers" refers to PricewaterhouseCoopers LLP or, as the context requires, the PricewaterhouseCoopers global network or other member firms of the network, each of which is a separate and independent legal entity.

About the IAB:

Founded in 1996, the Interactive Advertising Bureau (http://www.iab.net) represents over 375 leading interactive companies that actively engage in and support the sale of interactive advertising. IAB members are responsible for selling over 86% of online advertising in the United States. On behalf of its members, the IAB is dedicated to the growth of the interactive advertising marketplace, of interactive's share of total marketing spend, and of its members' share of total marketing spend. The IAB evaluates and recommends standards and practices, fields interactive effectiveness research, and educates marketers, agencies, and media companies, as well as the wider business community, about the value of interactive advertising.

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