Google and Facebook lead digital ad industry to revenue record

[SAN FRANCISCO] Google and Facebook Inc claimed the largest share of the booming US digital advertising market in 2015, pulling away from smaller rivals, according to two industry reports Thursday.

Online advertising revenue in the US reached a record of US$59.6 billion last year, up 20 per cent from 2014, the Interactive Advertising Bureau said in its annual report on the business.

Google, the leading Internet search provider, and Facebook, the biggest social network operator, claimed 64 per cent of that revenue, according to Pivotal Research analyst Brian Wieser. Google scooped up US$30 billion and Facebook gathered US$8 billion, while other smaller companies lost market share, the analyst noted.

"Smaller companies will continue to operate in the shadows of the industry's two dominant players," Mr Wieser wrote in a note to investors.

Late Thursday, Google parent Alphabet Inc reported a 20 per cent jump in first-quarter revenue from its own websites, including Google.com and YouTube. Facebook is scheduled to report results on April 27.

The rest of the industry saw growth in the low double digits in 2015 after a relatively flat 2014, according to Mr Wieser's report, which cited IAB's data along with his own analysis. The growth was driven by a niche players such as Pandora Media Inc, LinkedIn Corp and Twitter Inc, offset by weaker older Web players like Yahoo! Inc, the analyst said.

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