Third-Straight Quarter of Increased Revenue

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NEW YORK ( -- Buoyed by keyword search advertising, online ad revenues rose for the third consecutive quarter to $1.66 billion, according to a report issued today by the Interactive Advertising Bureau and PricewaterhouseCoopers.

First six months
Interactive ad revenues in the U.S. for the first six months of 2003 reached $3.29 billion, representing a 10.5% increase over the same period a year ago.

"Recent revenue results strongly suggest the industry has rebounded," said Pete Petrusky, director for new media at PricewaterhouseCoopers. Fewer non-cash ad deals, increased broadband usage and pay-for-performance Internet searches were cited as factors in the recovery.

The findings
Among the report's findings:

  • Keyword search accounted for 31% of total ad revenues for the second quarter, up nearly 13% over the first quarter.

  • Rich Media interactive ad formats doubled their share from 3% in second quarter of 2002, to 6% in the second quarter of 2003.

  • Search advertising grabbed 35% of second quarter 2003 revenues, up 15% from the same period in 2002, while hybrid deals, a mix of cost-per-thousand (CPM) viewers and performance, declined to 20% compared to 39% in second quarter 2002.

  • Ad deals done through the CPM pricing model accounted for 45% of all interactive revenues for the second quarter, virtually unchanged from last year.

    Top consumer categories
    The report found that the top consumer categories using online advertising are:

    Consumer: 35% in second quarter 2003 vs. 32% in the year-ago period
    Computing: 20% vs. 19%
    Financial Services: 13% vs. 14%
    Media: 12% vs. 12%
    Business Services: 10% vs. 6%

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