31 May 2006

Internet advertising will have overtaken newspaper advertising by the end of 2006, according to the media buying company Group M.

In a report to be published next month, it predicts that the Internet will account for 13.3 per cent of the £12.2 billion UK advertising market this year, outdoing national newspapers with a share of 13.2 per cent.

And the web advertising figure could be even bigger than this, Group M says, because the report does not include the estimated £1 billion a year spent on affiliate advertising, which involves adverts placed on smaller websites.

Internet advertising has taken off dramatically over a short period of time. The growth in broadband uptake has been cited as one of the driving forces behind the migration from print to Internet, and the decline of newspaper circulation has also played a significant role.

"Reach is what advertisers want most," report says. "National newspapers still have lots of it, but less reach means less ad money."

With more sophisticated mobile technology coming onto the market, Group M also expects advertising on mobile platforms to grow, further threatening the print medium.

"Mobile advertising is at the start of a growth curve like that of the Internet, which initially grew at annual rates of up to 200 per cent," the report states.

© Adfero Ltd

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