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Facebook to best Yahoo as #1 display ad seller

After two successive years of triple-digit boosts, Facebook revenue growth is slowing

Financial trends and news by Ronny Kerr
June 20, 2011 | Comments
Short URL: http://vator.tv/n/1bb9

As the date for a Facebook IPO seems less like a dream and more of a possibility than ever before, all investor eyes are on the company’s revenues, which come in large part from display advertising.

Facebook’s display revenues in the U.S. will grow this year by an estimated 80.9 percent to $2.19 billion, according to eMarketer.

This latest boost, which follows two years of triple-digit growth, will help Facebook boot Yahoo from the title of number one display ad seller in the country. Next year, eMarketer estimates display advertising revenues on the social site to grow, but slowly, by just 31.3 percent.

Google’s display revenue is expected to grow about 34.4 percent this year, after more than doubling revenues in 2010. And while Microsoft, Yahoo and AOL all experienced negative growth in 2009, all are expected to hit double-digit growth this year.

“Facebook’s supreme popularity—both in terms of numbers of people and amount of time they spend there—creates a plethora of display ad impressions, mainly for its unique form of banners,” said David Hallerman, eMarketer principal analyst. “And that popularity is also boosting what advertisers will pay for its display ads.”

The new data from eMarketer is interesting because comScore reported last month that Facebook makes up the most display ad impressions in the U.S., accounting for 31.2 percent of the market. Hardly approaching Facebook’s 346 billion display ad impressions for the first quarter of 2011 were Yahoo! Sites with 112 billion impressions (10.1 percent share), Microsoft Sites with 54 billion impressions (4.8 percent), and AOL, Inc. with 33 billion impressions (3.0 percent share.

Though Google doesn’t rank as highly as the rest, the company has increasingly invested its time and money in building a comprehensive ad network. Most recently, this has been evident through its $400 million purchase of AdMeld, which is just one in a long line of product developments and acquisitions in the advertising space.


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