Ads Up: Online Spending Climb 26% from Last Year

By: U.S. spending on Internet ads hit a new high for the 10th consecutive quarter during the first three months of the year, a trend that has enriched online powerhouses like Google Inc. and has distressed other more established media like newspapers.

The first quarter's Internet ad volume totaled $4.9 billion, a 26 percent increase from the same time last year, according to figures released Wednesday by the Interactive Advertising Bureau and PricewaterhouseCoopers.

Advertisers have been accelerating their online spending since 2003's final quarter in an effort to reach consumers who are increasingly surfing the Web instead of reading newspapers, watching television and listening to the radio.

The shift has been a boon for Google, the owner of the Web's largest ad network and already one of the country's most profitable companies after less than nine years in business. Meanwhile, other media outlets are trimming their staffs and cutting other costs as they try to offset recent other revenue losses and brace for even more financial pain.

Online advertising is expected to become an even more attractive option as Google and other Web sites develop better marketing platforms for video. U.S. online ad revenue is expected to climb to about $20 billion this year, up from $16.9 billion last year.


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