While some might hold out hope that the economy could stabilize in the second half of the year, Cowen & Co. have lowered their revenue forecast for U.S. online ads to a 6% decline in 2009 to $22 billion.
The financial analyst firm, which tends to offer more pessimistic forecasts compared to other prognosticators, had previously anticipated that online ad spend would drop 3%. Online share of the ad market will continue to rise, but only slightly, ending this year 9.4% of total U.S. ad budgets over last year’s 8.7%.
—Facebook beats portals: In keeping with eMarketer’s expectation that Facebook’s revs will grow 9% this year, Cowen remains as bullish as ever on the social net. Though eMarketer said that Facebook will end the year with $230 million in revenues, Cowen concludes that Facebook will generate roughly $500 million in sales, mostly through display advertising.
Cowen also estimates that Facebook’s advertising growth rates will be up around 70%, the highest on its list of 22 other major online media properties. By comparison, News Corp. ( NWS - news - people )'s WSJ.com has the next highest growth rates at 20%.
And of that list, the only other sites that saw gains in Q1 are WebMD ( HLTH - news - people ) (16%), Google ( GOOG - news - people ) worldwide (7%), Google U.S. (4%), and Yahoo ( YHOO - news - people ) U.S. search (3%).
The financial analyst firm, which tends to offer more pessimistic forecasts compared to other prognosticators, had previously anticipated that online ad spend would drop 3%. Online share of the ad market will continue to rise, but only slightly, ending this year 9.4% of total U.S. ad budgets over last year’s 8.7%.
—Facebook beats portals: In keeping with eMarketer’s expectation that Facebook’s revs will grow 9% this year, Cowen remains as bullish as ever on the social net. Though eMarketer said that Facebook will end the year with $230 million in revenues, Cowen concludes that Facebook will generate roughly $500 million in sales, mostly through display advertising.
Cowen also estimates that Facebook’s advertising growth rates will be up around 70%, the highest on its list of 22 other major online media properties. By comparison, News Corp. ( NWS - news - people )'s WSJ.com has the next highest growth rates at 20%.
And of that list, the only other sites that saw gains in Q1 are WebMD ( HLTH - news - people ) (16%), Google ( GOOG - news - people ) worldwide (7%), Google U.S. (4%), and Yahoo ( YHOO - news - people ) U.S. search (3%).
On the other end of the list, Yahoo display was down 13%, Microsoft ( MSFT - news - people ) dropped 16% and Time Warner ( TWX - news - people )'s AOL display fell 17%.
Cowen finds a direct connection between Facebook’s successful growth and the portals’ downward trends, even as the companies exit the recession. The basic trend is that users are spending more time with Facebook—an average of 3 hours per month on the site—than with portals. Facebook had 200 million active users in April, up from 150 million in January. If that growth trend continues, Facebook’s user base will be larger than Yahoo’s in about two years. More after the jump
—Yahoo beats AOL, MSN: That said, within the portal group, Yahoo is pegged to come out on top. Cowen expects Yahoo’s display business is $1.6 billion.
Cowen finds a direct connection between Facebook’s successful growth and the portals’ downward trends, even as the companies exit the recession. The basic trend is that users are spending more time with Facebook—an average of 3 hours per month on the site—than with portals. Facebook had 200 million active users in April, up from 150 million in January. If that growth trend continues, Facebook’s user base will be larger than Yahoo’s in about two years. More after the jump
—Yahoo beats AOL, MSN: That said, within the portal group, Yahoo is pegged to come out on top. Cowen expects Yahoo’s display business is $1.6 billion.
Source: forbes.com
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