IDC Report: The Internet to be the #2 Ad Medium in Five Years

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According to a recently released study by  IDC, , Internet advertising revenue will double from $25.5 billion in 2007 to $51.1 billion in 2012. During this period Internet advertising will grow about eight times as fast as advertising at large.

In this five year period the report says that The Internet will go in the next 5 years from the number 5 advertising medium all the way to the number 2, making it bigger than newspapers, bigger than cable TV, bigger even than broadcast TV, and second only to direct marketing.

The report states that Video advertising will be the principal disruptor of Internet advertising during this time, as its revenue grows sevenfold from $0.5 billion in 2007 to $3.8 billion in 2012 at a compound annual growth rate of 49.4%. Brand advertisers will shift significant amounts of money into video commercials, primarily from broadcast television and to a lesser extent from cable television.

IDC concludes that

  • Search ads will remain as the top Internet ad generator with revenues of $10.4 billion last year, reaching almost $18 billion in 2012. IDC believes search, now having almost 41 percent of the market share, will have just above 34 percent by 2012.
  • Online video ad spending will grow from about $500 million in 2007 to $3.8 billion in 2012 and its Internet advertising share will expand from 2 percent to 7.4 percent.
  • Referral and lead-generation services will see the second strongest market share gain, says IDC. Revenue from referral and lead generation services will grow from $2.3 billion in 2007 to $5.9 billion in 2012.
  • Mobile advertising will also show robust growth but the segment will still have “just shy” of 1 percent of the overall online ad market by 2012.

About Michael Berkens

Michael Berkens, Esq. is the founder and Editor-in-Chief of TheDomains.com. Michael is also the co-founder of Worldwide Media Inc. which sold around 70K domain to Godaddy.com in December 2015 and now owns around 8K domain names . Michael was also one of the 5 Judges selected for the the Verisign 30th Anniversary .Com contest.

Comments

  3. Tony Lam, DMD says

    Steve Ballmer said in an interview recently that in 10 years everything will be digital and distributed over an IP (interactive). Not that any MSFT person has been right about predicting the future in the last decade but that’s also promising.

    I still scratch my head when it comes to Microsoft. They can be the world’s biggest (quantity and quality) domain holder and they have yet to “get it”. CNET and its portfolio for $2B, Marchex for another $1-2B, Dark Blue Sea for $100M, etc. All for under $5B total which is a fraction of what Yahoo would’ve cost. Redirect all those domains and build it around CNET’s search.com instead of live.com. They can use that new leverage to be a gorilla in the domain parking industry and maybe even their own registrar and give godaddy a run for its money. I don’t get why why they don’t get it still.

  5. jblack says

    Tony is exactly right. Common sense yet to be applied. I wonder if Frank has not sold out. His last post was rather cryptic that “everyone sells” (a), he has not posted or been to a conference recently (b), he has not been actively buying as far I as know (c). A company like Microsoft should be buying his portfolio, maybe they did.

  6. Tony Lam, DMD says

    I am by no means a fan of Microsoft but they have the money, the people and resources to really not only compete with Google in search but maybe be in a position to shape the internet in the future.

    It’s been said that McDonald’s is so successful not because of it’s burgers but because of its prime real estate locations. If Ballmer thinks everything will go through the web in 10 years, how big a leap of logic is it to think that whoever owns those prime web real estate locations will control how business and everything else will be done on the internet.

    It makes no sense to try to beat a Lamborghini by getting a Mustang while you already have a Buick. Buy the whole race track and it doesn’t matter if the Lamborghini wins.

  8. jblack says

    Well said analyzed again Tony, you have very good insights.
    Tim, yes that blogged uncompleted deal prior to the 2004 hurricane Ivan mention meant something to me too.