When it comes to market share gains in advertising dollars, Google outstripped every other media company in 2007, whether you look at the Web, TV, print, or radio. Earlier this morning, Henry Blodget compared the advertising revenues of 17 major media businesses (including News Corp, Time Warner Cable, Viacom, Google, Yahoo, Microsoft, AOL,, the New York Times, and CBS Radio). He left out Disney for some reason, but otherwise it’s a pretty good set of data (see the spreadsheet here). According to his calculations, total online ad revenues across these 17 companies grew 9% last year, online revenues grew 28% (versus 3% for offline ad revenues), and Google’s online ad revenues grew 44% (versus 15% for the combined online ad revenues of Yahoo, Microsoft, and AOL).
But let’s take a deeper dive into these numbers. Google added $2.6 billion in advertising revenues last year. Next in line and far behind was News Corp., which grew its ad revenues by $915 million. To better visualize how much Google is creaming every other media company, I put together the charts above and below (click on them to see a larger version). And here’s a table with each company’s ad-revenue gains (or declines), in descending order:
Now, what about absolute market share? Google does pretty well there too, with 14.9% of the total $58 billion represented by all 17 businesses. That is up from an 11.3% market share in 2006, and makes Google No. 2 behind News Corp’s 16.5% market share. (No.3, actually, behind Time Warner, but Blodget separated Time Warner Cable, Time Inc., and AOL, which combined would have a 15.2% market share).
Looking at the absolute numbers in the pie chart and table below really helps you put these businesses in perspective. For instance, check out Yahoo in the No. 4 spot, with $4.7 billion in ad revenues last year. It is right behind newspaper company Gannett, which is still a cash cow, but saw its advertising dollars decline by $338 million last year. Yahoo, in contrast gained $361 million in ad revenues. That’s still a fraction of Google’s growth, but looking at the absolute numbers let’s you see why Microsoft wants to buy it. A combined Yahoo-Microsoft would be No. 3 on this list.
And here are the underlying numbers:
Nice analytics!
Thanks Erick.
Mind boggling. Do you know how much of the News Corp ad revenue growth is tied to the Myspace/Google deal? Could tilt the chart further.
At first I was like, uh you forgot to add the charts. Then I realized you probably named them “ad-xyz.gif” or something along those lines and adblock was getting them. Checked your source and I was right!
Oh well… I think I’d rather not see the charts than be blasted by the 15 billion ads on TC. Recently I was at someone else’s computer who only has IE and I loaded up TC and nearly vomited from how many ads there were. It’s a bit out of control.
Interesting though its not much surprising..
Speaking for another ad supported site, we’ve got to pay the bills somehow…B
Bart I have no problem with advertising as long as it is within reason, hey I have ads on my site, so I know the feeling. I just loaded this page up in IE, there are 5 advertising areas throughout which there are a total of 14 unique ads. That’s just too much.
When a site have ads like Sean mention (or even too much ads), I basically can’t see them anymore. What maybe say something on CPM (Can the adverister really know if you look at them or not).
On the other hand, CPC is no better. I guess the one who clicks on ads you don’t really want to click at all…
The ads on the internet feels a lot like an internal bubble. (Too much… When it is a good site – well it might be reasonable to have some but like on TV when the site is crap I really would like to move to another channel)…
Okay. Leave out Disney. The one traditional media company that *kinda* gets it. Seems like a totally fair analysis.
Please note that the number for Gannett only includes print revenue. Gannett revenues were more than $7.4b for 2007. On-line revenue is growing. Lies, damn lies and incorrect information.
Okay. This data is wrong. Much as we like to think of AOL as an independent company it is not. AOL’s revenue should be included under Time Warner. By the way the last time I checked both Time Warner Cable and Time were part of TW too. Before you analyze a company’s revenues you must first realize what the company is. AOL, TIME Inc., and Time Warner Cable are corporate divisions and are apart on ONE company’s online operations (Until the unit is sold off). Breaking revenue apart only serves to analyze how each division contributed to the corporate whole.
I have a feeling that if the traditional companies release all of their produce into the net via ad supported platform a la hulu.com they will regain their ‘mojo’ in a very short time indeed.
Good analysis. Nice chart.
you forgot the chart which shows the 0.000001% of Google ads that people actually pay attention to or generate any revenue for the advertiser.
Great chart and nice review!
These charts are not really explained well. Are the charts total or online only ad revenue? I’m assuming all the numbers are in millions?
“you forgot the chart which shows the 0.000001% of Google ads that people actually pay attention to or generate any revenue for the advertiser.”
What??? It’s been well documented for years that relevant text based ad generate much higher click troughs than image based non relevant ads. Your claim is absurd. Did Google beat you up in high school or something?
I agree with Tom. And Joe. These charts are not explained well and are flawed. In fact, you admit they are flawed in your article – with major errors like leaving out Disney and erroneously fragmenting huge companies like Time Warner, what else is wrong with these numbers?
When you’ve got errors that big in a study, why use it at all? It’s just plain wrong.
But the charts ARE pretty. Too bad that doesn’t count for more.
There seems to be some confusion about the data in these charts. As I note in the post, these are not comprehensive. They are from an analysis Henry Blodget did of 17 media businesses. I link to the spreadsheet with the underlying data in the post.
The reason AOL, Time Inc., etc are separated out is because Henry was originally trying to show the advertising gains/losses in Web vs TV vs print vs radio.
So the data is not wrong. It is what it is. And while not perfect it is instructive nonetheless.
If anyone wants to play around with the data, add Disney, and create a more comprehensive chart, send it to me (erick at techcrunch), and I’ll add it to the post.
I really expected more from Yahoo. As for Google, that’s no new news.
Erick: this is really excellent info & analysis. thanks for the article.
(Mike: once again, awesome scoop getting Erick on the TC team
Disney had ~700 million last year in what Iger called “Online Revenue” and predicted 1billion for this year. That includes itunes which made them a couple of hundred million.
I imagine he left them out, as their breakouts and business model make it difficult to compare them to the other media companies listed. ESPN.com for example has a substantially higher threshold for advertiser quality than any of the sources listed in the graph. Go to ESPN.com and look for yourself, count the external ads on any page. They also advertise a lot of their own properties on the site.
ESPN gets $3 from every cable subscriber and only signs contracts that put the channel on the basic tier, if cable companies balk, they pull the channel and sports fans convince the cable co to bring it back.
The CPM has to be pretty high for online ads for it to be more profitable than advertising their own high margin goods and services.
thanks for your information.
but i am wondering where google’s ad revenue number comes from?
google’s financial reports says it made 16 bil from ad.
am waiting for your explaination.
cheers.
Good charts.
But the sample of the 17 companies is not a fully representative sample though. If you look at the ad spend by medium, you will notice that Internet ads is only 7.8% of the total ad spend. http://www.mark...mber-2007-3764/
With the data in this sample, it seems like online ad spend is much higher than it really is. Of course Google is eating everybody’s lunch. But maybe not 4% of total ad spend budget as this sample lets us believe.
Erick,
Is there a way to delineate what Ad revenue is related to the sports industry? I’d like to see how that is broken down.