Internet Ad Market Suffers Second Straight Decline In 2Q
August 05 2009 - 2:18PM
Dow Jones News
Worldwide spending on Internet advertising fell 5% in the most
recent quarter, the second consecutive period in which the
once-booming online ad market has shrunk, market-research group IDC
said Wednesday.
IDC expects to see declines in the third and fourth quarters and
predicts that spending on Internet search, display and classified
ads may not significantly rebound until mid 2010.
"The good news: It seems like things are not going to get any
worse anymore in the Internet ad industry," said IDC analyst
Karsten Weide in a statement.
For the second quarter, IDC said worldwide ad spending was down
5% to $13.9 billion from $14.7 billion in the same period a year
ago. The results are included in IDC's forthcoming Worldwide and
U.S. Internet Ad Spend Report 2Q09.
The downturn hit most areas of the world, with the exception of
the Asia Pacific region, including Japan, which saw slight gains in
the most recent quarter.
U.S. Internet ad spending also declined for the second time in a
row, down about 7% to $6.2 billion from $6.6 billion a year
earlier. The pain was felt across all major formats, with search
ads being least affected, display ads losing 12%, and classifieds
shrinking 17%, the research group said.
IDC said ad sales for all major publishers declined, mostly at a
double-digit rate, with search market leader Google Inc. (GOOG) the
only exception. It posted low single-digit growth.
Worst affected were Monster Worldwide Inc. (MWW) owing to its
exposure to the heavily hit classifieds business, and Time Warner
Inc.'s (TWX) AOL unit, which suffered from weakness in display ads
as well as internal sales problems.
In recent trading Wednesday, shares in Google were down 1% at
$449.39, Monster was off 4.5% to $13.21, and Time Warner was down
2.7% at $27.32.
-By Scott Morrison, Dow Jones Newswires; 415-765-6118;
scott.morrison@dowjones.com