Net advertising up 37 percent in 2006's first half

Spending in online ads grew 37 percent in the first half of 2006 in the US.

U.S. companies spent 37 percent more in online advertising in the first half of the year, compared with the same period in 2005, according to a new study.

Online ad spending reached US$7.9 billion, as ads delivered in a search-engine context accounted for 40 percent of the total, ranking first among ad formats, according to a report from the Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PWC).

This search format makes up most of Google's revenue, which has been growing at an impressive clip in recent years. The growth in search advertising has prompted companies like Yahoo and Microsoft to invest heavily in building their own search engines and accompanying ad networks. However, Google remains by far the most popular search engine.

The display format, which includes multimedia, banner and sponsorship ads, generated 31 percent of the total. Within this category, video ads are expected to grow quickly, helped by the broad availability of broadband. The third largest format was classified listings with 20 percent of ad spending.

The overall growth reflects the continued importance of Internet marketing for U.S. advertisers, the IAB and PWC said in a statement. The second quarter of 2006 was the seventh consecutive growth quarter for online advertising revenue.

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