A new report from US e-business research company eMarketer suggests that online advertising will reach a new high by the end of the year.

With online ad spending growing at its fastest ever rate of 25%, this sector of the industry looks set to top what is predicted to be a bumper year for overall US adspend.

The political elections, 2004 Olympic games and strong economy are behind the 'one-two-three' boost to total adspend seen in the rise from $245.5bn in 2003 to $264.5bn this year.

Prior to the dotcom crash, online ad revenues were $8.1 billion (€6.6bn; £4.4bn). The eMarketer Ad Spending in the US, Online & Offline report, based on data from the Interactive Advertising Bureau and PricewaterhouseCoopers, forecasts this year's revenues will exceed this at $9.1bn.

The author of the report, David Hallerman explains the reasons behind the 'maturing' online ad industry as a result of a move towards online advertising by large companies, more paid-search ad campaigns, increased use of rich media such as online video by marketers and a rise in consumer broadband usage.

Although many marketers use paid-search formats (40% of all online adspend), rich media is expected to surge ahead this year with predicted growth at 64%.

Industry leaders suggest the funding behind the rise in online adpend will derive from increased total ad budgets and a shift away from newspaper and TV advertising expenditure.

For more information on the report, click here

Data sourced from: AdAge.com; additional content by WARC staff