• by Gavin O'Malley  @mp_gavin, June 1, 2010

Rebounding rapidly from the global downturn, China saw media advertising revenue jump 11.7% during the first quarter of the year, according to new data from Mediabrands' MAGNAGlobal.

For the full year, total ad revenues should rise by 14.4% -- up from 8.2% last year -- to $21.2 billion, forecasts MAGNAGlobal.

"With a resurgence of foreign investment and employment, China's greatest challenge is not around recovery, but preventing hyper growth and speculation," according to the MAGNAGlobal report. "Exponential increases in real estate pricing have skeptics pointing to a bubble, and China is increasingly facing pressure to moderate growth of exports through a lift on its currency peg."

While TV continues to dominate the nation in terms of media share, growth is most pronounced in digital in China, with strong activity happening around emerging media.

Magazines, newspapers, radio and outdoor are expected to continue their double-digit growth, MAGNAGlobal forecasts. As a result, by 2013, China's media economy will be the world's second-largest.

Growth in TV -- up by 12.7% in 2010 to $8.4 billion -- is fueled by the rising popularity of regional satellite channels catering to niche tastes. However, increasing regulations and restrictions are restraining that growth.

However, TV faces increasing pressure from online entertainment sources -- while totals for television continue to rise, the medium loses share as a part of the advertising-supported media sector as growth is limited by the government's tight control over the medium.

Within digital -- the fastest-growing sector of China's media industry -- search is expected to grow 30.9% in 2010 to $1.6 billion.

Google's exit from China solidified Baidu's dominance over the Chinese search market, allowing the search giant to post 59.6% growth in the first quarter of the year.

"While the lack of competition created by Google's departure may hinder expansion of the medium in the short term, the Chinese government's own search engine initiative may prove to be a competitor greater than Google," according to the MAGNAGlobal report.

While other governments around the world have attempted to create competing search engines in the past without commercial success, the Chinese government is more likely to succeed given the vast resources and clout that its state-owned enterprises currently hold.

Separately on Monday, MAGNAGlobal predicted that German media suppliers will collectively generate 3% growth to about $20 billion this year -- a better-than-average "new normal" year based on unprecedented government intervention and easier comparisons to last, during which German media supplier advertising revenue declined 9%.

As in many countries, search will continue to dominate display as the primary online ad platform in Germany with about $2 billion in revenue this year. Overall, online is Germany's fastest-growing medium, and MAGNAGlobal estimates it will continue to grow at above market rates through the year. As a result, online will likely account for 20% of total supplier revenues.