Online Ad Spending

Numbers released on Tuesday by the Interactive Advertising Bureau (IAB) showed that online ad revenue continued to grow at a quick pace in Q4 2006, reaching nearly $4.8 billion, the highest reporte quarter for the industry. The revenue from Q4 2006 was up 32% from the same quarter in 2005. The report anticipates total 2006 revenues, to be revealed next month, to clock in at $16.8 billion, a 34 percent increase from 2005.

While spending continues to increase, the rate of growth has slowed slightly. At $4.8 billion, revenues in Q4 2006 represent an increase of 15 percent over Q3 2006, when spending on online advertising hit $4.2 billion. In Q4 2005, Internet ad revenues were up 34 percent over the same period in '04, reaching $3.6 billion.

The report determined that the increase in spending was a result of more spending by more marketers. In addition, the revenue increase was affected by the increase in the cost of online advertising and accompanying services.

The fourth quarter figures and full 2006 estimates, sponsored by the IAB, were calculated by PricewaterhouseCoopers based on surveys and aggregated data from the top 15 online advertising sellers.