Canadian Online Advertising Grows Dramatically in 2004, 2005

Online Revenues will exceed $500 million dollars
in 2005, according to the annual revenue survey by the Interactive Advertising
Bureau of Canada (IAB).
The survey estimates that the year-end total for Online advertising in
Canada in 2005 will be $519 million, a full 43 percent more than the 2004
figure.
Driven by growth in Display and Search advertising, actual Online
advertising revenue in Canada for 2004 was confirmed at 364 million - a full
54 percent higher than the 2003 actual revenue of $237 million. And, of the
$364 million, approximately $65.5 million or 18 percent of ad dollars were
allocated to the French Canadian market.
Display advertising continues to garner the largest portion of the Online
advertising pie at 45 percent of total revenues, while Search advertising grew
dollars to a 30 percent share of all online advertising in 2004. The remaining
2004 Online ad categories include Classified/Directories/Direct Response at 22
percent of total revenue, and E-mail at 3 percent.
"These numbers confirm what we have been feeling in the market for some
time now," says Brent Lowe-Bernie, Chair of the IAB. "Investment in the Online
channel is increasing at an explosive rate as advertisers and their agencies
follow the movement of consumers, and take in learning from research such as
the IAB's publisher-supported Canadian Media Optimization Studies (CMOST)."
"And, there's still plenty of room for growth in 2005 and beyond," says
Paula Gignac, Executive Director of the IAB. "Recent research by Ipsos-Reid's
shows that the Internet has eclipsed Radio in popularity among all wired
Canadians, and actually trumps TV in the 18-34 demographic. In the U.S.,
Online's share is already at 8 percent, and growing steadily in response to
similar media consumption shifts. Yet at the 2004 level of $364 million,
Online advertising still represents just 4 percent of the total advertising
dollars spent in Canada. Clearly, a wealth of opportunities still exist for
advertisers to tap into the channel in order to build their businesses."

About the Internet Advertising Revenue Report
A copy of the full report is available for download at
http://www.iabcanada.com. The 2004 actual revenues and the 2005 projected
revenues were reached after a comprehensive survey of all major Online
publishers in Canada. The top 100 sites selling advertising in Canada were
surveyed, with the study benefitting from a 43% response rate. Revenue data
was compiled by Ernst & Young in conjunction with analysis by Faulkner
Consulting.
A second revenue survey will be conducted in 2005 near the end of the
year, to confirm 2005 estimates and provide an early snapshot of projected
growth in 2006.

The Interactive Advertising Bureau of Canada is the national voice of the
Canadian Interactive marketing and advertising industry, and is a not-for-
profit association representing a membership composed of publishers, agencies,
advertisers and interactive service associates.

For further information: Paula Gignac, Executive Director, IAB Canada,
(416) 845-6994, IABCANADA.COM

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