Piper Jaffray Predicts Global Online Advertising Revenue to Reach $81.1 Billion by 2011 in New Report: 'The User Revolution'
February 23 2007 - 9:29AM
PR Newswire (US)
PALO ALTO, Calif., Feb. 23 /PRNewswire-FirstCall/ -- Piper Jaffray
& Co. Internet Media and Marketing research team today
published an in-depth, comprehensive research report titled, "The
User Revolution," discussing the new advertising ecosystem and the
rise of the Internet as a mass medium. In the report, the team
outlines its expectations that global online advertising revenue
will reach $81.1 billion by 2011, representing a 21 percent
compound-annual-growth-rate (2006-2011). The report defines user
revolution as a major trend that is happening primarily with
consumers, who are taking control of content consumption and
branding. "The historically passive consumer is changing rapidly,
not only becoming more informed and confident about purchase
decisions, but also increasingly taking control of the consumption
of information and content that used to be distributed by networks,
studios, publishers and retailers," said Safa Rashtchy, senior
research analyst at Piper Jaffray. "We believe this will cause a
significant rise in prominence of the Internet as a major content
consumption and marketing medium." There are 12 key themes
discussed in "The User Revolution" report: 1. Global online
advertising revenue to reach $81.1 billion by 2011. 2.
Communitainment: Internet has increasingly become a principal
medium for community, communication and entertainment -- three
areas that have collided and are impacting each other's growth --
generating a new type of activity: communitainment. Communitainment
is taking time away from other, traditional, types of content
consumption on the Internet. 3. Usites -- The increasing popular
category of user generated sites, which we are calling Usites, are
driving traffic away from other destinations and pose a challenge
to the advertisers and publishers. 4. The Internet is now a
mainstream medium: The web is the leading medium at work and the
second leading medium at home behind television. 5. Internet usage
patterns are changing, favoring Usites, communitainment sites,
search, and away from traditional portals. 6. User Generated
Brands. The consumers are taking control of content consumption and
branding. 7. Media Fragmentation: Advertisers increasingly will
need to buy more inventory, from nearly all types of media,
especially the Internet, to have the desired impact. 8. The Golden
Search: search has become the new portal. 9. Google's dominance is
likely to expand, partly fueled by a wide variety of non-search
related products that create a virtuous cycle of brand affinity for
Google. 10. Video ads will be the driver of the next major growth
in brand advertising and getting additional dollars shifted from
traditional media to online. 11. Ad networks are experiencing
increased demand due to increasing Internet fragmentation, desire
for more targeted inventory, increasing usage of networks for
branding and increased site visibility. 12. Agencies are rapidly
evolving into more sophisticated, technology-savvy entities that
combine best of breed offerings. The report also lists the most
important companies to watch during this revolution, companies that
are likely to benefit most, or be highly impacted by these trends.
These companies include: Google (and YouTube), Yahoo!, Disney, News
Corp., Time Warner, Microsoft, InterActive, Facebook, Craigslist,
Brightcove, Yelp, SINA Corp., Baidu, aQuantive, ValueClick, 24/7
Media, Netflix, Wikipedia, MobiTV, Digg and Hakia. "Like many major
social trends, the changes will not happen overnight and we expect
the User Revolution, which has just begun, to last several years
before the new regime is fully established and the old statues have
all been toppled over," said Rashtchy. About Piper Jaffray Piper
Jaffray Companies is a leading, international middle market
investment bank and institutional securities firm, serving the
needs of middle market corporations, private equity groups, public
entities, nonprofit clients and institutional investors. Founded in
1895, Piper Jaffray provides a comprehensive set of products and
services, including equity and debt capital markets products;
public finance services; mergers and acquisitions advisory
services; high-yield and structured products; institutional equity
and fixed-income sales and trading; and equity and high-yield
research. With headquarters in Minneapolis, Piper Jaffray has 25
offices across the United States and international locations in
London and Shanghai. The firm's UK operating subsidiary, Piper
Jaffray Ltd., is authorized and regulated by the Financial Services
Authority and is a member of the London Stock Exchange. Piper
Jaffray & Co. is the firm's principal operating subsidiary.
(NYSE:PJC) ( http://www.piperjaffray.com/ ) Since 1895. Member SIPC
and NYSE. Disclaimers Piper Jaffray does and seeks to do business
with companies covered in its research reports. As a result,
investors should be aware that the firm may have a conflict of
interest that could affect the objectivity of this report.
Investors should consider this report as only a single factor in
making their investment decisions. This report should be read in
conjunction with important disclosure information at the following
site: http://www.piperjaffray.com/researchdisclosures . DATASOURCE:
Piper Jaffray & Co. CONTACT: Susan Beatty, Public Relations and
Communications of Piper Jaffray, +1-612-303-5680 Web site:
http://www.piperjaffray.com/
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