IDC Forecasts Online Advertising In Asia/Pacific Will Exceed $1B By 2004.

Online advertising in Asia/Pacific (excluding Japan) is gaining momentum and is expected to exceed $1 billion by 2004, according to a new report released by IDC. IDC found that companies are increasingly beginning to view the Internet as a viable means to reach new audiences and advertise more effectively. "As it stands now, companies in Asia are taking a wait-and-see approach to advertising online," says Matthew McGarvey, Internet analyst for IDC Asia/Pacific. "However, as the Internet becomes more pervasive, companies are recognizing the tremendous amount of potential that advertising online offers."

The report found that online advertising in Asia/Pacific (excluding Japan) accounted for less than 0.5 percent of total advertising revenue in the region during 1999. IDC forecasts Asian online advertising to generate $1.15 billion in revenue in 2004 and grow at a 76 percent compound annual growth rate (CAGR) from $67 million in 1999."

Advertising agencies, ad networks, and portals will need to focus on educating the general public on the effectiveness of online advertising and the possibilities that it offers," McGarvey said. Much of the growth in online advertising in Asia/Pacific will occur between 2002 and 2004. "Currently, IT companies, telecommunications providers, financial institutions, and dot-coms are the leading advertisers online."

The report found that over the next four years, online advertising in all Asia/Pacific countries would experience bullish growth. Market competition is also expected to grow increasingly fierce and fragmented. The majority of regional Internet content providers are learning they cannot survive on advertisement revenue alone and will have to seek alternative forms of revenue. To fill this void, online advertising networks and traditional advertising agencies will need to focus on working past the standard banner advertisement and create more effective forms of advertisement.