UK online ad spend beat forecasts through 2007, growing 38 percent to £2.81 billion, according to the Internet Advertising Bureau’s latest annual survey with PwC. It grew nine times faster than a “relatively buoyant” UK ad market overall, which grew 4.3 percent to £18.4 billion.

The net increased its share of the ad market 3.9 percent to 15.3 percent, making it the third biggest destination for ad spend, ahead of press clasifieds and regional news display ads (just five years ago, it was the smallest). To put it another way - in the last three years, the market has grown by £2 billion.

-- Specifics: Web display ads grew 31 percent - most of it going to portals and the big publishers, but an increased 40 percent going to ad networks. Spend on banners, skyscrapers and rich media grew 45 percent to £592 million. Search marketing spend grew 39 percent to £1.6 billion though its share of spend was largely flat at 57.6 percent. Classified ads were up 54 percent to £585.2 million, with recruitment leading cars, technology and finance.

-- TV: IAB UK said UK online ad spend would overtake that on TV to become the top ad medium by the end of 2009 - a little later than forecast by January’s Group M study on the issue

Those in the business are bullish. PwC media manager Nicki Lynas: “Internet advertising is big business, and it’s not going to stop growing anytime soon.” They credited cheap laptops, broadband connections and catch-up TV services for the growth and expect high-CPM social networks to drive growth in 2008.

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