This article titled “Facebook effect lifts UK online advertising past £4bn” was written by Mark Sweney, for guardian.co.uk on Tuesday 29th March 2011 06.10 UTC

Facebook helped the UK online display advertising market grow by more than a quarter to almost £1bn last year.

The Internet Advertising Bureau’s annual report, compiled with PricewaterhouseCoopers, attributed a 27.5% year-on-year surge in online display advertising to £945m to advertisers moving into social media.

In total the UK ad market grew by 12.8% year on year in 2010 to pass £4bn for the first time, with £1 in every £4 spent on marketing and advertising by British companies now spent online.

According to industry sources, Facebook UK made about £100m in ad revenue last year. The IAB said that the spend on social media accounted for 14%, or £132m, of the online display advertising market – a year-on-year rise of 200%.

In 2009 the online display advertising market was worth £709m, meaning growth last year of £236m or 33%, but the IAB has stripped out “new media entrants” in the online display sector to give a like-for-like growth figure of 27.5%.

The online display market also benefited from the rise of video advertising, which almost doubled to £54m. Online display now accounts for 23% of all internet advertising.

Advertisers’ appetite for social media reduced the proportion of the total £4bn internet ad spend going to paid-for search – effectively money spent on Google – from 61% to 57%. The paid-for search market grew by 8% year on year to £2.35bn.

To put this in perspective, the total UK TV ad market was worth about £3.5bn last year.

However, TV advertising bounced back strongly from the 2009 recession, with 15% year-on-year growth in 2010, outstripping the growth rate for internet advertising for the first time since it was first measured more than a decade ago.

Bucking the trend seen in print advertising, the online classified market grew 9.7% year-on-year in 2010 to £751m. Mobile advertising grew 116% to £83m.

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