IAB: Online ad revenue hits record $16.9B in 2006
The huge internet advertising revenue growth shows no sign of abating. In 2006 ad spending on the medium grew 35 percent to finish at a record high of $16.9 billion in the U.S., according to figures released yesterday from the Interactive Advertising Bureau and PricewaterhouseCoopers. This growth rate is faster than in 2005, when ad revenue on the web grew at 30 percent to hit $12.5 billion. The major categories of search, display and classified all continue to rise at healthy rates. Spending on search grew by 32.2 percent to hit $6.8 billion in 2006. Search advertising continues to have the highest market share at 40 percent, although that is down from a 41 percent market share in 2005. Meanwhile, display advertising took 32 percent of the internet advertising revenue market last year, compared to 34 percent the year before. Classifieds accounted for 18 percent of spending in 2006 compared to 17 percent the year before. The IAB also released figures for the fourth quarter of 2006, which experienced year-over-year growth of 35 percent to hit a record $4.8 billion.

Internet radio stations reject royalties compromise
Internet radio stations are saying no to a compromise proposal from the U.S. music industry that would allow small stations to keep the old fee structure but force larger digital stations to pay the controversial new royalty fees. SaveNetRadio, which represents internet radio stations, said in a statement Tuesday that the proposal by SoundExchange, which collects royalties on behalf of the labels, would decimate the internet radio industry. “Under this proposal, internet radio would become a lousy long-term business, unable to compete effectively against big broadcast and big satellite radio-- artists, web casters, and listeners be damned,” says SaveNetRadio spokesman Jake Ward. The U.S. Copyright Royalties Board (CRB) is set to implement higher charges for online radio music licenses on July 15, retroactive to January 1, 2006. Net radio stations say that the increases will put them out of business.

Bud wiser: A-B says failed TV site will fade away
Bud.TV isn’t generating the buzz Anheuser-Busch anticipated among the 20-something crowd. The company said during a conference with analysts this week that it will allow the $20 million project to fade away by year’s end if visits to the web site don’t pick up. Bud.TV averaged just 253,000 visitors in February, its first month online. By March, that number had dropped to 153,000, according to web traffic measurement company ComScore, and early results for April indicate a continued downturn. Apparently, A-B’s effort to avoid charges of promoting underage drinking did the most damage to the site’s success. A complicated age verification, among other things, was required to register and enter the site. Nonetheless, the company hopes to use Bud.TV’s content as part of a broader digital effort. Bud.TV features more than 2,000 minutes of proprietary video including stand-up comedy clips, a guys' makeover show and “The Joe Buck Show,” in which the Fox play-by-play man interviews celebrities in a New York City cab.

Study: Web's the place to build buzz on entertainment
More young people are turning to the web to learn about new artists and buy related products, according to a report by research firm Media-Screen, and the new trend in entertainment consumption is affecting conventional marketing dramatically. According to the report, released earlier this month, 48 percent of younger users say they learn about new entertainment through blogs, community, review and video sharing sites. Only 25 percent say they learn about new entertainment through television. “Many broadband consumers go online for entertainment, and to talk about entertainment with other fans,” Josh Crandall, managing director of Media-Screen, said in a statement. “Marketers need to leverage that interest and focus on catalyzing a conversation now, instead of just talking to their fans via traditional advertising channels.” The report, entitled Netpop|Play, also revealed that broadband users in general are spending 48 percent of their spare time online in a typical day. That equates to about one hour and 40 minutes.