Sunday, July 08, 2007

DCCI: Web Advertising to Reach 7.6 Billion Yuan in 2007

July 9, Beijing

Under the guidance of Internet Society of China, DCCI (Data Center of the Chinese Internet) published market data of Chinese internet for the first half of 2007.

Major findings:

1. Internet market is prospering. During the first half, average monthly personal consumption reached 186 yuan and will be as high as 196 yuan at end of the year. Annual consumption will average 3,641 yuan. With increasing of about 20 million users annually, the yearly total consumption will double that of 2005. First half total consumption came in at 162 billion yuan. Second half total consumption expected to reach 202 billion yuan, more than the total amount recorded in the whole year of 2005.

2. Web advertising performed better than expected. Whole year advertising revenue will reach 7.6 billion yuan. The figure dose not include search advertising. First half online advertising revenue reached 3.27 billion yuan, similar to the total amount of 2005. Year over year growth expected to be about 53%. Previous expectation had been about 50%.

3. Search marketing grew rapidly with huge potential. First half revenue grew almost 73%. Total search market was 1.15 billion yuan and already higher than that of whole year of 2005. Second half revenue expected to take another jump of 35.6% over the first half. Network search advertising estimate to grow 45.8% over the first half and higher than the growth rate of keyword advertising.

4. Online video surpassed TV by 17% and becoming major source of video. The new DCCI data revealed that 77.95% users downloaded video from the internet comparing with 60.59% viewed them on TV.

5. Online video faces fierce competition with unsettled market position. The data surprisingly found that over 70% viewers willing to accept advertising as long as it does not interferes with viewing the videos. The most tolerable length is about 10 second-clips.

6. More challenge than growth is the changing landscape of online advertising. Video ads is already taking off due to innovations from key market players. Second half growth will be as high as 90.5%.


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