U.S. Online Ad Revenue Down 16% in 2002, IAB Says

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The Interactive Advertising Bureau and PricewaterhouseCoopers yesterday released the Internet Ad Revenue Report that included final totals for the fourth-quarter and full-year 2002.


U.S. Internet ad revenue totaled $6 billion last year, down 16 percent from the prior year. However, Internet ad revenue reached $1.6 billion for last year's fourth quarter, an improvement from an earlier fourth-quarter estimate of $1.5 billion and up 9 percent from the third-quarter 2002 amount.


The 2001 and 2000 revenue data have been adjusted to reflect revenue restatements reported in public filings by several companies. Historical revenue totals have been adjusted to $7.13 billion in 2001 and $8.09 billion in 2000.


Fourth-quarter 2002 keyword search revenue share represented 21 percent of total ad format revenues. Internet ad revenues by ad formats for 2002 full year revenue include: banners, 29 percent (down from 36 percent in 2001); sponsorships, 18 percent (down from 26 percent); classifieds, 15 percent (down from 16 percent); keyword search, 15 percent (up from 4 percent); and slotting fees remained at 8 percent year to year.


The CPM pricing model accounted for 45 percent of all deal revenues last year, down from 48 percent, while straight performance deals were at 21 percent, up from 12 percent. Hybrid deals, a combination of CPM and performance, declined to 34 percent, down from 40 percent.


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