Facebook's advertising business is booming

Facebook nearly owns a quarter of online display ads in the US
Facebook nearly owns a quarter of online display ads in the US

Facebook's online advertising business is booming, with Mark Zuckerberg's social network running nearly one in four online display ads in the US.

Facebook now owns a healthy 23.1 per cent share of display ad impressions in the US, up from 17.7 per cent in the last quarter of 2010.

Facebook races ahead

It puts Facebook at nearly double the number two ranked company, Yahoo, which has an 11 per cent share of America's online display ads right now.

The latest figures showing Facebook's growing slice of the online advertising pie come from a new report by Web analytics firm comScore, showing that Facebook's website totalled more ad impressions than Yahoo, Microsoft, Google and Fox Interactive media combined.

Facebook delivered 297 billion impressions of display ads in the US in the third quarter of 2010, according to comScore.

Evercore Partners analyst Ken Sena's estimates that the effective CPM (cost per thousand impressions) for Facebook's US display ads is around $1, compared with a $3 CPM for display ads on Yahoo's sites.

"It certainly is an issue for the portal sites," said Sena. "While you still have the sort of traditional display players benefiting from strong growth trends in display (advertising), social is probably taking a disproportionate share of that growth."

The US online display ad market is expected to grow by around 13 per cent to $8.56 billion in 2010, according to eMarketer.

Via Reuters

Adam Hartley