Internet ad spending down in U.S.

First quarter slops 5% compared with last year

Even online advertising isn't recession proof.

U.S. Internet ad spending slid in the first quarter of this year by 5% compared with the same period last year, netting out at $5.5 billion, according to the latest report issued by Interactive Advertising Bureau and PricewaterhouseCoopers LLP.

That figure represents the lowest ad spend level in nearly two years, and a decline of roughly 10% versus the fourth quarter -- when the industry's long period of nearly uninterrupted growth showed signs of stalling.

The 5% decline is hardly surprising, given the widespread talk in the online ad industry of a weak display ad market. Recently, eMarketer revised its 2009 online ad spending growth projection from 8.9% to 4.5% -- predicting that spending for the year would net out at $24.5 billion.

However, IAB and PwC officials said that considering the impact of the recession, the Web was still fairing better than other media. "Current economic conditions are clearly challenging," said David Silverman, PwC Assurance partner. "Nonetheless, interactive media continues to consume a larger piece of the overall advertising pie."