For the second time this year, online ad industry authority eMarketer has lowered its spending estimate for social-networking advertising for 2008 to $1.2 billion, down from the $1.4 billion benchmark set in May -- which itself was down from an earlier spend estimate of $1.6 billion.
Officials at eMarketer said the decision to lower its spending estimates for the segment was driven by the overall poor ad economy and weak performance by MySpace, which saw its revenue projection for 2008 drop by $170 million (from $755 million to $585 million) versus the company’s May numbers. Rival social network Facebook’s revenue estimate also dropped from $265 million to $210 million, indicating that the still unproven ad medium is gaining traction at a slower rate than once expected. Overall, MySpace and Facebook account for 70 percent of social media ad dollars, according to eMarketer.
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