Until recently, the advertising industry was reeling from the slump it entered in 2001 when the bursting of the tech bubble and 9-11 brought about an abrupt collapse in ad spending. Some advertisers abandoned traditional ads for other forms of marketing, such as in-store promotions, direct mail or outdoor posters. Others turned to the Internet and paid-search sites such as Google. Now, however, advertising is bouncing back, even if it is still far from business as usual.

The ad market in 2004 was boosted by some special factors, such as a presidential election in America and the Olympics, and analysts expect ad spending to grow by around 6% in 2005, especially as firms become more aggressive in their battles for market share.

Television remains the most-powerful advertising medium, with a 38% global share of spending on major media in 2004. But things are changing. Many people nowadays watch cable or satellite channels rather than the main networks. Television is expected to retain its overall share of the market through 2007, although it is uncertain what effect TiVo and other ad-skipping technologies may have.

Spending will also shift in other areas. The Internet is the fastest-growing advertising medium, especially due to the fact that young men now spend more time surfing the Internet than watching TV. The Web currently accounts for $8.7 billion (5.4%) of America's ad spending. And while that number is still relatively small, the Internet, with its rapid growth, is set to earn more ad revenue worldwide than outdoor advertising by the end of this decade.