SOURCE: eMarketer

September 04, 2007 09:00 ET

Online Advertising Will Surpass Radio Spend by Year End

But the Internet Can Help Radio, According to eMarketer Report

NEW YORK, NY--(Marketwire - September 4, 2007) - Radio has lagged behind both television and newspapers in adapting to the digital world. This year is a watershed: For the first time, online advertising will surpass radio advertising spending in the US.

But this does not signal the death of the radio, according to eMarketer's report "Radio Trends: On Air and Online." There are many synergies between radio and the Internet and, for the most part, they complement rather than compete with each other.

eMarketer expects US radio advertising spending to grow 1.5% during 2007 to $20.4 billion. Although the forecasted growth rate is hardly spectacular between 2006 and 2011, an additional $2.5 billion will be spent on radio advertising. Radio station Web sites and in-stream Internet audio advertising will be the principal drivers of this growth.

Media such as the Internet, satellite radio, HD radio, podcasting and mobile devices are potential enhancers.

"While advertising spending is growing rapidly online, it is not necessarily at the expense of radio," says Ben Macklin, senior analyst and author of the report. "There seems to be no reason why this market cannot find a new lease on life and benefit from the growth in the online sector. Advertisers should not abandon radio in favor of the Web, but combine the two to take advantage of the unique attributes of each."

In the report:

--  How can the radio industry take advantage of new media?
--  What are the growth prospects for Internet, satellite and high-
    definition radio?
--  Can Internet radio sustain the imposition of new royalty charges?
--  How big is the podcast audience and what are their demographics?

About eMarketer

eMarketer is "The First Place to Look" for market research information related to the Internet, e-business, online marketing and emerging technologies. eMarketer aggregates and analyzes e-business research from over 2,800 sources, and brings it together in analyst reports, daily research articles and the "eStat Database" -- the most comprehensive database of e-business and online marketing statistics in the world.

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