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Internet advertising revenue reaches $17 billion

October 11, 2012|By Dawn C. Chmielewski
  • Facebook Chief Operating Officer Sheryl Sandberg, center, speaks during an interview with Charlie Rose, left, and venture capitalist Marc Andreessen at the Interactive Advertising Bureau conference.
Facebook Chief Operating Officer Sheryl Sandberg, center, speaks during… (Victor J. Blue / Bloomberg )

Spending for Internet advertising reached $17 billion in the first half of the year, up 14% from the same time in 2011, as marketers seem to grow increasingly comfortable with using mobile devices and digital video to communicate brand messages.

Search-related advertising still dominates online spending, accounting for 48% of revenues for the first half of 2012, according to a newly released report from the Interactive Advertising Bureau. However, mobile was the area of fastest growth, with spending nearly doubling year over year, to reach $1.2 billion in the first six months of the year, the report said.

"Bringing the power of the Internet to mobile devices has opened up a world of possibilities to both consumers and marketers," said David Silverman, a partner at PricewaterhouseCoopers, which prepared the report.

Digital video ads -- the Internet equivalent of television commercials -- rose to a little over $1 billion in revenue in the first two quarters of 2012, an 18% gain from a year ago, the report said.

Retailers cut spending for the first half of the year to about $3.4 billion, a 4% decline from a year ago. Despite the decrease, this category of marketers remain the biggest online spenders, accounting for 20% of revenue.

Telecommunications, financial services and automotive businesses also advertise heavily online, with each group spending in excess of $2 billion in the first half of 2012, the report said.

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