Reports related to companies interested in acquiring a stake in Time Warner's America Online unit and rising Internet advertising figure this year are indicating that online advertising is suddenly hot, according

Published: 19 Oct 2005

Reports related to companies interested in acquiring a stake in Time Warner's America Online unit and rising Internet advertising figure this year are indicating that online advertising is suddenly hot, according

Microsoft, Google, Yahoo and Comcast all have their own reasons for
pursuing a minority stake in Time Warner's America Online unit, says
MSNBC report.

The report adds: "But one thing is clear from the frenzy of speculation
over the future of the Internet property: After years of disappointment
that followed the dot-com collapse, online advertising is suddenly hot.
Internet advertising, which slumped to just $6 billion in 2002 from more
than $8 billion in 2000, has rebounded dramatically and is expected to
grow 34 percent this year to nearly $13 billion, according to eMarketer,
a research firm. The market is tightly concentrated, with more than half
the sales going to just four players: Microsoft's MSN, Yahoo, AOL and
Google."

David Hallerman, a senior analyst at eMarketer, was quoted as saying:
"Over the last couple of years it has become clear to everyone that the
Internet is here to stay and there is a lot of audience there. There is
no longer a boom-and-bust mentality."

In the same report, James Rutherford, executive vice president of
Veronis Suhler Stevenson, an investment bank, estimates Internet
advertising will grow at an average 24 percent a year over the next five
years, compared with just 7 percent for the advertising industry overall
and 4 percent for network television. By 2009 online advertisers will
pay $28 billion nationwide, more than consumer magazines will generate
from advertising and circulation combined, Rutherford said.

"Keyword search has been the key driver of the resurgence in online
advertising," Jeff Lanctot, a vice president at Avenue A/Razorfish
reportedly said.

"From Amazon.com and eBay to online travel agents like Travelocity and
Expedia, plenty of multibillion-dollar businesses have been built
through online advertising, marketing and sales. The difference now is
that major brand-name advertisers including car makers and
consumer-product companies are now jumping onto the Internet bandwagon
in droves," says the report.