Jupiter Predicts 27% Ad Growth For Web Video

Media Life, Wednesday, July 26, 2006 11:31 AM
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From MySpace to online gaming to streaming "Desperate Housewives," online video is all the rage on the Web. You'd think that means years of stellar ad growth, similar to the search-marketing boom a few years ago. But a new forecast from JupiterResearch says the amount spent on Web video will grow at a more modest clip--27 percent per year between 2006 and 2011, reports Media Life. That's less than Internet advertising overall in the last few years. Keep a few things in mind: a 27 percent CAG is quite robust, especially for an ad format that costs considerably more than others. Search exploded because so many small- to mid-size advertisers were willing to spend money on customer acquisition they could easily measure. Video isn't for everybody. Moreover, the economy is expected to slow down soon, as a result of oil problems, uncertainty in the Mideast, inflation, and higher interest rates. And no one can predict how long that will last. It's nice to know that this time around, Internet ad budgets won't be the first to be slashed, but they will definitely feel the effects of a slower economy. In fact, 27 percent per year starts to look rather good. But as always with forecasts, caution is advised. Who knows what will happen between now and 2011?

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