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Ofcom have recently announced that UK broadband speeds increased by 22% last year. In addition, they plan to cut the cost of line rentals and broadband connections. Simultaneously, there is also huge growth in online advertising from some of the largest firms in the UK. So can we assume then that as broadband speeds quicken, more money will be spent by firms advertising online?
Internet advertising in the UK increased by 13.5% in the first half of 2011 according to a survey conducted by the Internet Advertising Bureau (IAB), which puts spend for the first half of the year at £2.26 billion. When this is compared to overall UK advertising spend, the rise is particularly significant; there was a year-on-year growth of 1.4% to £8.27 billion between January and June 2011.
Now imagine your surprise as an employee of the National Republican Senatorial Committee, when you visit a political website and see an advert for Democratic President Obama on a brand new platform. Not immediately remarkable, but when you contact Google to enquire a little further, you might be surprised to learn that it is a pre-alpha test and that it appears your rivals are getting preferential treatment.
Google are on course to make another huge acquisition, this time it’s the ad optimisation platform Admeld that have caught the search engine’s eye. But Google will have to part with a reported $400 million and get it through the usual regulatory approval.
The news was first reported by Tech Crunch and has since been covered by multiple sources. The acquisition sees Google attempting to tackle display advertising, something they have struggled with in the past.
As a business in transition, it probably won’t come as too much of a surprise that AOL has once again seen revenue and profits slipping. The good news though comes in the form of income from display ads, which saw global growth of 4 percent [see: AOL’s Q1: Display Ad Revenues Finally Going Up, But Profits Are Down 86 Percent | TechCrunch].
However, as reported yesterday, this comes off the back of some pretty shaky figures in the last couple of quarters, which saw back to back reductions of 26% in overall revenue [see: AOL to Develop Larger Display Ads in Profits Push]. It also masks a huge drop of some 86% in profits, although this can largely be explained away by the significant investments made during this period – most notably the Huffington Post for $350 million.