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No online ad recession yet – apparently

Posted by John Horniblow on May 12, 2009 in Online Media |

In a recent article by eMarketer there was 1st true indications that there’s “No Online Ad Recession, Yet” and interestingly their calculations do not indicate that online advertising has entered a recession. The numbers speak for themselves.

The net US revenues at the four major search portals, which account for by far the majority of online ad revenues, all showed quarter-over-quarter growth in Q4 2008 and fell in Q1 2009. But that represents only one quarter of falling growth—and it follows the traditionally oversized Q4.

US Online Advertising Revenue* Quarter-over-Quarter Growth at Top Four Portals, Q1 2008-Q1 2009 (% change)

There’s no index on other smaller publishers , but what is resounding clear is while ad spends in traditional channels are severely down there is groundswell on

eMarketer postulates that ” based on the total year-over-year revenues from the four portals, the picture is less bleak. Growth was positive for all four quarters in 2008 (AOL being the exception to the rule). The single negative-growth quarter, thus far, was Q1 2009.

US Online Advertising Revenue* Year-over-Year Growth at Top Four Portals, Q1 2008-Q1 2009 (% change)

For context, here is the picture in dollars.

US Online Advertising Revenues* at Top Four Portals, Q1 2008-Q1 2009 (millions)

“The imbalance between Google and its competition in both Q4 2008 and Q1 2009 highlights a fundamental weakness in the overall US online ad market,” added Mr. Hallerman. “Consider that US display ad spending, such as for banners, will drop by nearly 5% this year—and then consider how that trend will likely be reflected not only for Web portals but many other publishers as well.”

Obviously, Q2 2009 is critical. If revenue growth at the four major search portals continues to fall, online advertising will “officially” enter recession.”

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