15% is a Magic Number

Posted: November 7, 2005 in Uncategorized
I saw Mary Meeker of Morgan Stanley at a conference a while back and I asked her what percent of traditional advertising sales could online chew into this decade. 
I’ve often said that 10% was reasonable.
But, her response was an emphatic, "15%, falling off a log."
Was just reading a Motley Fool piece (the most excellent financial reporting anywhere) where it mentioned that Ford was going to spend 15% of its ad budget on the Internet to move more F-150 trucks.

Could the 15% number be real… and happening faster than any of us could really imagine?

I certainly think so.
Which would mean a worldwide online advertising market of $60-$90 billion (15% of $400-$600 billion).
Given online advertising was only $10 billion in 2004, this would mean this industry could really 6x-9x before the end of the decade.
All split primarily between GOOG, YHOO, and MSN.  (I’m assuming AOL gets swallowed up by one of those three.) 
That’s why MSN has jumped into this market with both feet — and GOOG and YHOO will become $20 billion companies before anyone realizes it.
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