• by Joe Mandese  @mp_joemandese, June 16, 2010

Interpublic's Magna Global unit this morning issued a revised outlook for the global ad economy, calling for an increase of 4.2% in 2010, nearly double the 2.4% rate of growth the agency estimated in its last published estimate at the end of 2009.

"This follows 2009's downturn, which caused a contraction of 11.3% compared to 2008's totals," Magna writes in the new report. "Long term growth rates are also upgraded modestly, reflecting stronger expectations of global economic recovery through 2015."

The agency projects that the global ad economy will expand at an average annual rate of 5.1% over the next five years, an upgrade from 4.8% in its previous forecast.

Magna said video advertising - primarily TV - would remain the dominant source of advertising budgets, account for $151 billion, or more than 40% of the $377 billion global ad economy.

"Notably TV's share is lower in Europe given the pronounced role of public service broadcasters (restrictions on PSBs' advertising efforts limit TV inventory), but in all regions television is growing, up 5.4% on average through 2015," the agency noted.

Online advertising, meanwhile, is projected to overtake newspapers as the second largest advertising medium by 2013, and will surpass the $100 billion mark, totaling $103 billion in 2015.

"This will occur largely due to market expansion as new advertisers have become the backbone of that medium," the report reads. "But newspapers will continue to grow modestly - up 1.8% in constant currency terms over the next five years - despite sustained declines in many markets. In many countries, newspapers represent a viable means of distributing content to emerging consumer classes and do not face meaningful cannibalization from online competition."

Magazines" face worse conditions with respect to online competition," Magna predicted, estimating that the print medium would fall by 0.3% each year through 2015.

Radio and out-of-home will grow on a global basis, although out-of-home "faces more favorable circumstances," according to the agency.