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Technology Stocks : NetGravity [NETG] -- Ignore unavailable to you. Want to Upgrade?

To: go_bucks who wrote (451)	5/3/1999 6:46:00 AM
From: Brian K. Winchell	Read Replies (1) \| Respond to of 589

Monday May 3, 12:19 am Eastern Time Internet ad spending up 112 percent in 1998 By Yukari Iwatani SAN FRANCISCO, May 3 (Reuters) - Internet advertising revenues more than doubled to $1.92 billion in 1998, the Internet Advertising Bureau (IAB) announced on Monday. The IAB Internet Advertising Report said ad spending on the Internet grew 112 percent last year, surpassing the $1.58 billion spent on outdoor advertising. Online spending in 1997 was $906.5 million. ''Internet advertising is ratcheting up the ladder, so it is taking market share from other segments,'' said Pete Petrusky, director of new media for Price Waterhouse Coopers, which conducted the study. Petrusky said that in the fourth quarter alone, online advertising revenue increased by 34 percent, to $655.6 million. Just two years earlier, in 1996, Internet advertising annual revenue was only $267 million -- the equivalent of the total from only one month -- December -- in 1998. Started in 1996, the IAB report compiles data from more than 200 companies representing over 1,200 Web sites. It is considered a leading indicator of trends in online advertising. ''It is easy for us to forget that the Internet, as a viable advertising medium, is barely four years old,'' Rich LeFurgy, chairman of the IAB, said in a news release. ''It is astounding, that in such a relatively short period of time, its growth is now measured in billions of dollars.'' Both Petrusky and LeFurgy expect a sustained growth period in coming years due to increasing online ad budgets and greater commitments by large traditional advertisers. The report, which was to be announced at a news conference in San Francisco to coincide with @d:tech, an online advertising industry conference, also showed that consumer-related advertisements in 1998 continued to lead spending, at 31 percent, ahead of computer-related ads, at 28 percent, and financial services, at 19 percent. ''The gap between consumer-related and computing is beginning to widen,'' Petrusky said. ''Although computer-related ads primarily led spending prior to 1998, it is safe to say consumer-related advertisers will continue to lead the charge and the growth. Advertisers are recognizing the Internet as a branding and direct marketing tool,'' he added. The percentage share of consumer-related ads, which include retail, automotive and travel categories, was unchanged last year from 1997. But Petrusky said it was still significant because the total revenue was much higher. IAB also found that banner ads continued to be the predominant form of advertising, at 56 percent, followed by sponsorships, at 30 percent, television commercial-like interstitials at 5 percent and e-mail at 1 percent. Increasing numbers of Web publishers are also offering advertisers hybrid revenue models that combine an upfront CPM, or cost-per-thousand rate, and a performance-based revenue sharing rate. The report found that 40 percent of ad spending was based on straight CPM pricing, and 6 percent was based on straight performance deals. Fifty-four percent were hybrid deals. ''It is a win-win situation because the publisher continues to get an upfront valuation and they get a back-end revenue share. The advertiser gets a discounted CPM rate and placement,'' Petrusky said. (San Francisco Advertising Desk, 415-392-8813 or New York Advertising Desk 212-859-1886)) Related News Categories: computers, publishing, US Market News --------------------------------------------------------------------------------