Online constituted 3.6 percent of worldwide ad spending in 2004, up form 3.2 percent in 2003, and is expected to reach 4.4 percent by 2007, according to Publicis media agency ZenithOptimedia Group, reports MediaPost. In the U.S., online advertising has a 5.4 percent share of the market (Sweden - at 7.7 percent - has the highest share).

Zenith said it increased its predictions for overall ad spending for every year it had already forecast through 2007. However, it foresees that the TV advertising market will peak in 2006 as ad budgets begin shifting to other media, particularly the Internet.

Meanwhile, a Merrill Lynch analyst indicated that the shift is positive for ad agencies: "We are seeing shifts from traditional media to newer media such as local cable and the Internet. Agencies are compensated increasingly on fees rather than commissions so this is not really an issue for them; in fact, complexity is their friend."