Q3: As Traditional Ad Economy Sinks, Web Ads Still in Growth Mode

(MoneyWatch)  More evidence is emerging that the online advertising economy is separating from the traditional ad economy. Numbers out for Q3 adspend in both the U.S. and the U.K. show total ad expenditure declining, but spend on the web still increasing (albeit modestly). The IAB reported:

Internet advertising revenues reached almost $5.9 billion for the third quarter of 2008, representing an 11 percent increase over the same period in 2007. While double-digit annual growth continues, the quarter-to-quarter curve remains relatively flat compared to recent past performance. The Q3 2008 figures ... are 2 percent higher than the Q2 2008 results.

It's a similar situation across the pond:

Total advertising revenues will fall by 4.8 per cent in 2008 and 11.9 per cent in 2009 - the largest single-year fall since 1975.

Online advertising, which was growing at 39.5 per cent in 2007 and is expected to rise 19.5 per cent this year, will gain just 2.1 per cent in 2009. That growth is only because of search advertising, with online display revenues set to fall 5.5 per cent next year.

Mediaweek raises the interesting possibility that the recession may kill off the web banner ad, that long-hated purveyor of slow load times, browser crashes and lousy animation. Search will replace them, experts reckon:

Whether traditional banner ads, skyscrapers or 350x200 rich media units, Web ads are eminently ignorable, and rarely move one to laugh or cry.

The separate paths of the still-growing web ad environment and its collapsing traditional sibling were predicted on BNET after Q2 spend results were released.