] HipMojo.com » Online Advertising to be $32 Billion Market by 2010

Online Advertising to be $32 Billion Market by 2010

In the report, Morgan Stanley’s Mary Meeker predicted the Internet could grab 13 percent of about $243 billion in total U.S. ad spending in 2010, compared with 7 percent, or $13 billion, of $192 billion in 2005 ad spending. Internet advertising will continue to take dollars from traditional media, as spending triples online but grows slower or stagnates on television and in newspapers.

The growth will be supported by increasing crowds of American Web surfers — rising at 3 percent a year, to an estimated 229 million by 2010. As online advertising targets those users more effectively with better, more measurable returns, advertiser budgets will migrate in greater numbers to the Web.

By category, Meeker sees search advertising growing 25 percent a year to $15.8 billion, accounting for 50 percent of total U.S. online ad spend, compared with $6.7 billion, or 42 percent, today. The analyst’s figures assume Yahoo’s much-anticipated upgrade to its search and advertising platform performs as expected.

Display ads will make up 20 percent of ad spending, or $6.2 billion, compared with 26 percent, or $3.1 billion today.

The analyst predicted rich media advertising will grow 26 percent each year to $3.2 billion in 2010, and account for 10 percent of ad spending. (Advertisers will spend $1.1 billion, or 7 percent of their budgets, in the nascent medium in 2006.)

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Posted By: Ashkan Karbasfrooshan | Oct 13th

3 Responses to “Online Advertising to be $32 Billion Market by 2010”

  1. HipMojo.com - IT, Video, Web, Technology, Gadgets » Google To Boast Larger Market Capitalization than Microsoft in 2010 Says:
    October 22nd, 2006 at 10:32 pm

    […] What’s more, Google currently makes 99.9% of its revenues from paid search.  So this all assumes that paid search continues to grow.  Of course, paid search is growing, as are other areas of online advertising.  Just this past month, Morgan Stanley’s Mary Meeker came out and boasted that the US online ad market would be a $32 billion one by 2010, upping eMarketer’s $25 billion estimate.  Mind you, both eMarketer and Mary Meeker have a lot to gain by pumping these numbers, that’s how the system works.  And admittedly, I am certainly not drinking the Google koolaid and implying that Google will be making $32 billion in revenues by 2010 or that it will be worth more than Microsoft in 2010, I am trying to show that numbers can be played with.  When I’m not writing on this site, I’m busy building a company where interested parties ask me to define the market we’re going after, formulate a valuation for our company and what not, I do it as a fun exercise but am the first one to show how laughable such models are… just as crazy as RBC’s Jordan Rohan to come out and say that MySpace could be worth $15 billion in a few years.  The problem is that he’s paid to come up with such models, I’m not.  Point is: if Myspace and its social sexual predators can be worth $15 billion, heck, why can’t Google be worth more than MSFT?  I’ve argued that Google is well on its way to become the Standard Oil or MSFT-esque monopoly of the 21st Century. […]

  2. HipMojo.com - IT, Video, Web, Technology, Gadgets » Take Yahoo! Private, Triple Your Money in Four Years? Says:
    October 30th, 2006 at 3:05 pm

    […] If US online advertising becomes a $25 to $32 billion industry (eMarketer projects the former, Morgan Stanley the latter).  For simplicity’s sake, we’ll say the US online advertising industry will generate $30 billion in 2010.  […]

  3. HipMojo.com - IT, Video, Web, Technology, Gadgets » Asian Online Advertising Figures in 2010: $110 Billion Marketplace Says:
    November 3rd, 2006 at 4:28 pm

    […] I would like to call time-out and point out that this is the first time I’ve seen the $60 billion figure for the US though.  I’ve seen eMarketer peg the US ad market at $25 billion while Morgan Stanley pegs it at $32 billion.  Regardless, even at half of PWC’s projection for Asia, the “smart people in the room” seem to think that Asia will easily be a market 2 to 3 times larger than the US for online advertising, and they are probably right, when you consider the boom in China, India, South Korea and the entire region (suddenly, all of that ad inventory we have in India seems more and more valuable every day!). […]

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