Spending on search engine marketing will remain strong this year and next despite a lower forecast for the broader online ad industry, according to JPMorgan.

Analyst for the firm Imran Khan has slashed his forecast for the overall internet advertising sector, but has said that spending on search ads will rise by 27 per cent this year and by 26 per cent in 2009.

This is primarily down to businesses opting for more performance-based forms of marketing as the economy continues to slow, he said.

Mr Khan explained: "As advertisers become more conservative with their ad spend, we think that the long-tail advertisers will shift toward performance-based advertising forms."

A recent E-consultancy report predicted that spending on search will continue to rise in the UK, although growth will not reach the high levels experienced in previous years.

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