The amount of cash spent on Internet advertising in Europe is set to rise a massive 70 per cent this year, according to Forrester Research.

It reckons online ad spending is set to touch E1.2 billion (£757 million) this year - up from E690 million (£435 million) last year.

Forrester predicts that the first half of 2001 will be relatively quiet but that it should pick up during the second half of the year.

Forrester's Marc Cohen said in a statement: "Although dotcoms are tightening their belts, traditional advertisers are expected to step further into the market.

"In general, there is this virtuous circle going on. More people are going online, more people are getting comfortable with spending money online and more companies are getting money via online channels, so they can spend more on online marketing," he said.

Today's research was released on the same day the FT reported that Walt Disney could be about to ditch its portal, Go.com, because of plummeting ad revenue.

The FT reports Michael Eisner, group chairman and CE of Disney, as saying: "The advertising community has abandoned the internet."

In December, online ad spend across all of Europe's major markets hit E38.8 million (£24.5 million). Spending on online advertising in the UK fell slightly to E17.3 million (£11 million) in December, while in Germany spending fell a smidge to E12.6 million (£8 million). In France, Net advertising spending rose slightly to E8.6 million (£5.4 million).

In Britain, Virgin Group spent the most in December forking out some E349,000 (£222,000) in online advertising. ®