SOURCE: eMarketer

March 20, 2006 18:00 ET

Google Revenue to Exceed $10 Billion in 2007

A New eMarketer Report Analyzes Google's Search Marketing Business

NEW YORK, NY -- (MARKET WIRE) -- March 20, 2006 -- Google's worldwide gross revenue will total $11.8 billion in 2007, up from an estimated $9.3 billion in 2006, according to a new report from Internet research firm eMarketer.

Search Marketing: Players and Problems presents an in-depth examination of the paid search advertising business and looks at prospects for Google, the sector's driving force. The report details eMarketer's projection that Google will account for more than 57% of all US spending on paid search advertising in 2006, as well as predicting Google's total revenue this year and next in the context of eMarketer's expectations for the whole industry.

The search marketing industry, including Google's own business, faces a number of constraints. David Hallerman, eMarketer senior analyst and author of Search Marketing: Players and Problems notes, "with its revenue stream essentially flowing from this single source, Google will increasingly require alternative channels to maintain its spectacular revenue growth. Marketers might very well be the beneficiaries of these alternatives, especially when it comes to still-to-be-realized potential growth areas such as local search, video marketing and classified ads."

The report also describes how paid search advertising, which will continue growing for several years, is constrained by the threat of click fraud, consumer privacy concerns and the sheer complexity of creating and managing a successful campaign.

Looking beyond 2007, Mr Hallerman says "No doubt about it -- all is not rosy in the search business...concerns about click fraud and privacy are two sticking points that will potentially chip away at, if not halt, the growth of search engine marketing."

Search Marketing: Players and Problems presents a range of exclusive eMarketer forecasts, including:

--  57.2%: Google's share of total US paid search ad spending in 2006, up
    from 32.9% in 2004.
--  27.0%: Yahoo!'s share of total US paid search ad spending in 2006, up
    only 4 percentage points since 2004.
--  144.5 million: the number of US search engine users in 2006, rising to
    166.2 million by 2010.
--  50.5%: share of total US population (age 3+) that use search engines
    in 2006; will reach 56.1% in 2010.
    
The report also answers these key questions:
--  Why is Google so dominant among search engines (and will that
    continue)?
--  Are more individuals searching online (and how can marketers reach
    them)?
--  How should users' shopping behavior affect search marketers?
--  Is click fraud as big a problem as some reports make it out to be?
--  When is privacy a legitimate concern for search engines and marketers?
--  And many more...
    
Visit eMarketer for more information on Search Marketing: Players and Problems.

About eMarketer

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