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Spending for sponsored search will increase 47 percent in 2005, reaching $5.1 billion from last year's $3.5 billion, forecasts investment firm Merrill Lynch in a report on internet advertising issued Thursday, MediaPost writes.
Paid search and paid inclusion together are forecast to reach $5.5 billion - or 45 percent of the total online ad market in 2005. Much of the growth will be driven by broadband adoption, which will drive an increase in queries, according to Merrill Lynch.
The firm predicted a 20 percent increase in query volume for the year. It said the volume of queries per user grew between 16 and 18 percent in the first quarter, compared with 0-4 percent a year ago. Overall, Merrill Lynch continued to predict that online advertising would reach $12.4 billion this year and $25 billion by 2009.