Internet advertising in the US dropped 5 percent in the first quarter, marking the marketing medium’s first downturn since 2002, when the Web was still recovering from the dot-com bust.
The data released on Friday by the Interactive Advertising Bureau and PricewaterhouseCoopers LLP provided another reminder of the widespread pain wrought by the longest US recession since World War II.
But the Internet’s financial backbone isn’t sagging as badly as that of more established media like newspapers and broadcasters, where far more severe advertising losses have triggered massive layoffs, bankruptcy filings and doubts about whether their businesses will ever be the same again.
By contrast, the setback for ad-driven Web sites and services is considered temporary.
“We’re confident that growth will resume as the US economic climate improves,” said Randall Rothenberg, the Interactive Advertising Bureau’s chief executive.
Advertising revenue has been drying up as more companies clamp down on their marketing budgets to save money during tough times.
The drought has gotten worse during the past year as traditionally big spenders like banks, automobile makers and dealers, department stores and real estate developers have been grappling with major crises that have forced some of them to merge with rivals or simply close their doors.
Even before the Internet recorded the first-quarter decline in ad revenue, sales have been slowing down after years of rapid growth.
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