Online Ad Spend to Rise 38%

NEW YORK Internet ad spending hasn’t slowed down yet, according to data compiled by the Interactive Advertising Bureau.

The IAB estimates record first-quarter online ad spending of $3.9 billion, a 38 percent increase from the same period in 2005, and a 6 percent rise from the previous quarter.

In Q1 2005, Internet ad spending rose 26 percent from the same period in 2004, and 4 percent from the previous quarter, according to the IAB.

Those growth figures suggest that the industry is continuing to sharply expand, despite recent alliances, such as last week’s agreement allowing Yahoo to sell all graphical ads on eBay, which could point to a maturing industry.

The IAB, through PricewaterhouseCoopers, estimates ad-spending figures for the first and third quarters, using information from the top sellers of ad space. It provides actual results for the first half and full year.

While the numbers released Tuesday show fast-paced growth, online ad revenue is still dwarfed by traditional media, which earned $125 billion in 2005, per Nielsen Monitor-Plus.

Tuesday’s survey culled data from companies that report “meaningful online advertising revenues,” according to a statement from IAB. It includes data from Web sites, commercial online services, free e-mail providers and other companies selling online advertising.