The compound annual growth rate is estimated at 33% which is higher than most other forms of digital media. Currently mobile is the unprecedented behemoth with a realized 100% growth rate in 2007 after an increase last year of 80% as reported in Jack Meyers Media Business Report.

U.S. ad expenditures per gamer household came in below 50 cents in 2006, compared with $37 for broadcast television according to Michael Cai, director of broadband and gaming for Parks Associates and the lead analyst of the report. He said, “The potential I definitely there. If the industry does the right thing, if they collaborate with each other instead of throwing dirt on each other, we definitely have a good story to tell.”

The biggest portion of game-based advertising is attributed to display ads and advergames on Web-based gaming portals. Those components along with smaller areas of virtual worlds marketing and sponsored game tournaments and gaming sessions have accounted for $315 million of the $370 million in ad spending on games in 2006.

In-game ad placements, both dynamic and static brought in about $55 million, which Parks Associates expects to grow to $805 million or 40% over the next six years. Simultaneously dynamic in-game ad serving in PC, console, mobile and casual games will grow from 27% of the in-game market to 84% in 2012.

Cai approximates that marketers spent $15 million on virtual worlds marketing projects last year, which doesn’t include branded virtual worlds efforts.

Parks Associates interviewed 25 companies in in-game ad space for the report and incorporated resulting data with industry predictions and the firm’s own survey data from consumers.