Last year, 2006, was hailed as the year of local search. After 2005, where local online ad spend increased year over year by almost 80%, the sector was expected to continue it’s meteoric rise. It didn’t, the rate of year on year growth for 2006 dropped to 19%. Still a nice rise, but down quite a bit from the meteoric growth of the year before. 2007 was then hailed as the year of widgets, and local was been shunted off to a side rail, while everyone continued to try to figure out exactly how to leverage their knowledge and take over that space.

In a report released today by Borrell (executive summary available for free), local online ad spending for 2007 is anticipated to rise by 31.6% to $7.5 billion. A nice increase, especially when you consider that the overall national ad spend is only expected to increase by about 20%.

So who controls this market? Is it Google? Is it the local yellow pages? No, it’s still the newspapers, who control 35.9% of the market (although that’s down from 45.6% last year), while the pure play internet companies such as Google, have a 33.2% market share. What about the Yellow Page Publishers? Well, they’re the next largest group with 11.7%.

So local is hot once again. I would expect that by next year the pure play internet companies will be in the top spot. They have home field advantage over the medium, which obviously seems to count for more than the actual home field advantage that the local papers and yellow pages have…