U.S. Internet Advertising Hits $25.5 BillionBy: Mike Sachoff - February 12, 2008
U.S. Internet ad spending in the fourth quarter of 2007 grew nearly 28 percent over the same quarter in 2006 to $7.3 billion, said analyst firm IDC.
For the entire year 2007, online ad revenue grew 27 percent year over year to $25.5 billion.
IDC said that Google’s net U.S. market share dropped for the first time in two years because of a slow down in growth in domestic fourth quarter sales. Google’s net U.S. advertising market share decreased 0.5 percentage points to 23.7 percent last quarter compared to 3Q07.
The estimated net U.S. Internet advertising sales for Google (excluding the traffic acquisition costs they pay out to the partners in their networks) grew by just over 40 percent in 4Q07, but its year-on-year growth rate in the quarter before had been 50 percent.
"If a merger between Microsoft’s new media business and Yahoo! would come to pass, the combined entity would have a net U.S. advertising market share of about 17% based on our 4Q07 data," says Karsten Weide, program director for IDC’s Digital Marketplace: Media and Entertainment service.
"It would not quite bring Microsoft-Yahoo! to where Google is in online advertising in the U. S., but it would give them a much better fighting chance than if they went it alone."