Tech Industry

Web sites lean on their own ads, report says

Despite the growth in the number of Net advertisers, most firms are filling space by promoting their own products or services.

Although the number of ads on the Web continues to surge, most Internet companies are just tooting their horns on their own Web sites, according to a new study.

About 65 percent of Web companies fill advertising space on their sites with banner ads promoting their own products or services, according to a report released yesterday by AdRelevance, a division of Media Metrix.

New York-based Media Metrix tracks the popularity of Web sites.

The growth in advertising sales is fueled by the increasing number of Internet users worldwide. According to research firm Jupiter Communications, nearly 800 million people across the globe are expected to log on to the Web by 2005, compared to the 300 million today.

The AdRelevance report found that so-called house ads--advertisements by companies on their own sites--account for almost 20 percent of all available online ad inventory.

AdRelevance, which reviewed house advertising on 500 Web sites with the most traffic volume from January through April, also found that compared with other Web site genres, vertical sites such as online employment services led the group with the most house ads.

Roughly 45 percent of all ads on employment-focused sites were devoted to house ads. Other vertical sites, such as community portals, ran an average of 12 percent house ads.

The report said 63 Web sites carry more than 20 percent house ads. And 15 sites with content geared toward children and family, games, movies and television run more than 50 percent house ads.

Last week, New York-based Jupiter Communications released a report that said online advertising revenue is expected to reach $28 billion worldwide by 2005, from $7 billion this year. The Web is expected to account for almost 6 percent of all global advertising revenue by 2005.