Online-ad industry grows up

Web-advertising leaders back new measurement standards for online ads as the industry reports record sales.

Web-advertising leaders are backing new measurement standards for online ads as the industry reports record sales.

Major online publishers and industry organizations said Monday that they've approved standards for counting online-advertising impressions, clearing a major hurdle to mainstream adoption of the medium after almost 10 years.

The move should go a long way to promote ongoing growth in ad sales by simplifying the buying and selling process, according the Interactive Advertising Bureau, a trade group that championed the standards.

On Monday, the IAB reported the industry's eighth consecutive quarter of ad sales growth. Web-ad sales totaled about $2.43 billion in the third quarter, a 35.3 percent lift from the comparable period of 2003 and a 2.4 percent rise over the second quarter. Search-related advertising boosted the industry's upward trend, bolstering revenues of companies such as Google and Yahoo.

After years of doldrums, the Web-ad industry has finally returned to consistent growth. Online-ad revenue for the first nine months of the year was an estimated $7 billion, compared with $7.3 billion reported for all of 2003, according to IAB's half-year survey, which was conducted by PricewaterhouseCoopers. If the trend continues, 2004 could end up surpassing the previous record high of $8 billion in revenue reported in 2000.

"Single-digit, sequential growth demonstrates the industry has left behind the large revenue spikes that characterized the early years," Tom Hyland, head of the new media group at PricewaterhouseCoopers, said in a statement. "We're now looking at a maturing, stable industry that inspires further investment by large, traditional marketers."

One of the major steps on the road to maturity has been to establish guidelines for counting online ads--and gain widespread industry participation. The issue has been on the table for years and has inspired heated arguments between publishers and advertising agencies. Each side has wanted to maintain control over the way ad numbers are counted because it directly affects billing and revenue.

Publishers often count an ad impression when a line of code requesting the advertisement from a third-party ad server is sent with the delivered Web page. For a number of reasons, a requested line of code may not be displayed on a computer screen. Advertisers, or their third-party ad networks, often count the impression only when the image itself is delivered.

The new ad-measurement standards require that online publishers and advertisers count an "impression" or ad when it reaches the Web page, as opposed to counting it when it leaves the ad server--a rule favorable to

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