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The subprime mortgage implosion is spreading its radioactive dust on everything from homeowners to ratings agencies. One industry that may be forgotten is online advertising. Yes, online ads, that hot growth business that has shot Google into the stock market stratosphere may be next to report the mortgage industry fallout.
Oppenheimer Co. analyst Sandeep Aggarwall figures the financial industry accounted for $2.7 billion or 16% of all internet advertising last year. And while he still expects that number to climb in 2007 and 2008 he has lately trimmed his estimates of that growth. He estimates the mortgage sector in particular accounted for 3% of Google’s revenues, 4% of Yahoo and 45% at Bankrate Inc. Bad news too for Barry Diller’s InterActive Corp., which owns mortgage site Lendingtree.com.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.